The story of OpenTable versus the restaurants

A recent post to Incanto’s website answers the question often asked of the San Francisco eatery “Why are you not on” For those of you that don’t know OpenTable is a restaurant reservation service. The case against Incanto accepting OpenTable is, in summary, that OpenTable takes too much away from the bottom line and also shifts customer loyalty away from the individual restaurant, replacing it with customer loyalty to OpenTable.

Put another way, the real cost of OpenTable goes beyond just the monthly fee and the per-reservation fee. The cost is also the ownership of  the customer relationship, which no longer belongs to the individual restaurant. At first glance one thinks “the restaurants are nuts to pay for the alienation of customer loyalty” and this is distressingly close to the truth.

I don’t disagree with the general principle of being able to book a restaurant reservation via the Web. However, I agree with Incanto and others that OpenTable’s lofty goals have been overrun by greed, especially now that it is a public company. If OpenTable were to place more emphasis on helping individual restaurants succeed, and encouraging loyalty to specific restaurants instead of merely its own reservation service, my opinion might be different. But for now, my advice is for restaurants to close the book on OpenTable and do what Incanto has done: offer reservations via its own website.

Mobile phone exclusivity agreements under fire

Reports from both ITworld and Infoworld detail an inquiry from four US Senators to the FCC, regarding the exclusivity arrangements wireless phone manufacturers (such as Apple and Palm) have been making with wireless telephone carriers (such as AT&T and Sprint).

This follows an FCC petition by the Rural Cellular Association asking the former to investigate these exclusivity arrangements.

The timing couldn’t be worse for AT&T, as the telecom giant is dragging their feet to support MMS and tethering, among other things. Apple’s other carrier partners worldwide have been able to handle this without issue.

However, it should be noted that AT&T is not the only wireless telephone carrier in the crosshairs of the Senators and the FCC. T-Mobile and Sprint are known to have made exclusivity deals as well, which would undoubtedly be subject to the same scrutiny.

All of this is definitely a step in the right direction towards respecting the freedom of wireless phone users, or in other words, the rest of us. It is long overdue, but there is still a lot of work to do once exclusivity agreements are seen for what they are: anti-competitive collusion.

There is still a lot of cleaning up to do after this, however. Most notably, it would greatly benefit the wireless telephone users if there was one and only one standard in use: GSM. CDMA needs to go the way of the dodo, the sooner the better; the network design takes a significant amount of freedom out of the hands of the user, where it belongs. I consider myself rather technologically literate, and I did not know this until fairly recently (about a year or so ago).

GSM networks and phones use SIM (Subscriber Identity Module) cards for authentication and identification (or how the network tells which phone belongs to which user). If one wants to change phones, one simply powers down the old phone, removes the SIM card from the old phone (usually hidden behind the battery to make it impossible to remove while the phone is powered on), inserts the SIM card into the new phone, and powers the new phone on. The carrier (phone company) never has to get involved.

On a CDMA phone, it’s nowhere near that simple. One has to take the new phone into the store and have a staff member key in a bunch of magic numbers, and make changes on the wireless network so the new phone is recognized as legitimate. The wireless telephone carriers have the control; they can choose not to let you use the new phone on their network at all if they see it fit. It is, in fact, in the carrier’s best interest to get the customer to buy a brand new phone instead of re-activating an older model.

I have been told that Sprint will not activate non-Sprint phones for their service (i.e. phones not branded for use with Sprint). I would not be surprised if Verizon (and any other CDMA carriers?) adopt a similar policy.

Fortunately, we may actually see the demise of CDMA in our lifetime. Verizon is already in the process of changing over to GSM; that would leave Sprint as the last national US CDMA carrier in existence.