Phone maker Oppo has struck an exclusive deal with 2degrees for a NZ$2400 Lamborghini-branded Android phone. It is this seasons’ most expensive Android phone; at least in New Zealand.

The Find X Automobili Lamborghini Edition is a version of the company’s already-expensive-by-Android-standards NZ$1500 Oppo Find X. The extra $900 buys you a fancy Lamborghini case and bumps the phone’s storage from 256 GB to 512 GB.

A similar storage upgrade with other phone brands costs around $300 to $400. This means, in effect, Oppo and 2degrees want $500 for a luxury case and a little brand cache.

While it may not be official, you can buy external phone case covers with prestige brands printed on them for as little as $5 at places like Glenfield Night Market.

Sure, they’re not made of carbon fibre like the Find X Automobili Lamborghini Edition but come on, $500.

Lamborghini Oppo Find X
That’ll be $900 thank you.

Lamborghini exclusive

It is an exclusive deal. Only 2degrees get this model. It will only be on sale for a limited time. I suspect that the other carriers didn’t get into a bidding war for the rights to the Lamborghini Edition.

Oppo isn’t the first phone brand to try attaching its products to a flash car brand. Huawei did something like this with a Porsche branded model. It sank without a trace.

Going by that experience 2degrees and Oppo might struggle to get sales into double figures.

What makes this extra curious is that until now Oppo’s entire sales pitch has been about offering value for money. The company manages to pack about 90 percent of the functionality and features of, say, a top-of-the-line Samsung model into a phone that sells for roughly half the price.

You could say that Oppo is the phone brand for phone owners who aren’t too fussy about brand. That statement may be hard, but it’s fair.

Pricey Oppo

While we’re on this point, Oppo is pushing it asking $1500 for the Find X. Look for a review of that phone on this site in the next few days.

The Find X may have a unique pop-up camera to avoid notches or a large bezel, but that price is on a par with the best phones from better known brands like Huawei and Samsung.

Phone makers have worked to increase prices, in part because profit margins are slender. It’s one thing for an established name to bump prices by $100 or so, but this is getting on for double the price of earlier Oppo models.

After all, this is a brand who’s New Zealand phone sales are measured in hundreds, not tens of thousands.

Which brings us to the point of the wacky Find X Automobili Lamborghini Edition. It isn’t about selling a $2400 phone. Its main aim is to get attention for the Oppo brand. I guess this post proved that strategy worked.

Silverdale 4.5G cell siteFor 5G to deliver its promise, carriers need to use higher frequencies than today’s mobile networks.

Higher frequencies means more bandwidth. This can deliver faster data and more connections per square kilometre.

As a rule, higher frequency radio signals travel over shorter distances. Higher frequency sites will be useful in areas of high population density. In some cases they may be only a few dozen metres apart.

Cover every street

When cell sites are a few dozen metres apart, you need a lot of them. They will, in effect, need to go down every street in the country. The antennae don’t need to be as high as today’s cell towers. You can install high frequency cell sites on telephone and power poles or the sides of buildings.

Compared with today’s cell sites each one will cost a lot less to build. The hardware is smaller and less of an eyesore so the planning requirements will be simpler. And there will be some incremental upgrades.

Yet there will be so many new sites that the total cost of a 5G network could be as much as the earlier mobile. It all depends on how far New Zealand carriers intend to push the technology. It’s possible we won’t get the same 5G service as customers in say, Shanghai, Paris or New York.

Fibre is the 5G backhaul answer

Connecting lots of cell sites is tricky. Today’s cell sites often connect back to hubs using fibre connections. This is the best technology.

When Telecom, now Spark, built its XT mobile network it made a big deal of its towers using fibre backhaul. That’s the name engineers give to the practice of getting signals back to major centres.

Fibre backhaul gave the XT network a clear performance edge over Telecom’s rival. At least it did once Telecom ironed out the initial teething troubles.

Wireless option

Carriers don’t have to use fibre for 5G backhaul. In my NZ Herald interview Alex Wang said self-backhaul would be a feature of 5G. That is the towers link to each other in a wireless mesh network to get traffic back to a central hub.

Wireless backhaul is possible, but it limits overall network performance. You need a lot of bandwidth to backhaul thousands of 10 or 20 Gbps data streams.

It needs to be line-of-sight and it often uses higher power signals. Cue the protests and renewed fear of microwave signals causing health problems.

In practice fibre is a better way to handle 5G backhaul. It’s the most practical way to deliver the promised performance.

Overbuild

And that’s where the New Zealand mobile telecommunications industry hits a potential problem. There is already a nationwide fibre network for UFB.

Fibre companies already have fibre running down every urban street. It cost more than $5 billion to build that network.

That’s how much carriers must spend if they want a viable nationwide 5G network and compete with each other.

You could argue that building three more nationwide fibre networks would waste resources.

It would also add a lot to the cost of using a 5G network. Add in the cost of new antennae, site fees and network controllers. It could add up to more investment than carriers spent on earlier mobile generations.

Shared network

In practice there’s little chance of carriers building three more nationwide fibre networks. In theory the carriers could build a shared network.

There are arguments why this should not happen. For a start it could shut out any new competitors. There’s also a fear that three carriers owning shared mobile infrastructure could become a cartel. That’s also bad for competition and terrible for customers.

You can assume the Commerce Commission wouldn’t sign-off on shared infrastructure unless it is open access and otherwise regulated. The alternative is anti-competitive and would stifle innovation.

One third of a lot of money is still a lot of money

Even if carriers build a shared fibre 5G backhaul network, the cost per carrier would still be one-third of a big sum. It is more money than Vodafone or 2degrees appear to have today. This is before they need to spend on towers, antennae and the other kit needed to run a 5G mobile network.

Spark could raise the money for its share. The company has little debt. But even its investors might baulk at the cost of a nationwide fibre 5G backhaul network.

As we’ve already mentioned, a 5G network may need many more towers than the 4G networks that are in place today. Each site is likely to cost a lot less than the cost of a 4G site. The number of 5G sites needed to blanket cities and towns means the capital expenditure is going to, at least, be on a par with the investment in 4G. In reality it is likely to cost more.

A billion here, a billion there

Carriers don’t like to talk about the cost of building their networks. In round numbers each has spent in the region of NZ$1 billion on mobile network infrastructure.

Sure, that’s a back-of-an-envelope calculation. The exact numbers aren’t important. They have also invested many millions in buying spectrum.

The three carriers’ total capital spend on 4G to date is on a par with the amount needed to build the UFB network. They will also need to find the thick end of billion or so to build the extra sites needed for 5G.

This would be fine if there was a chance of getting customers to pay a premium for 5G mobile. That’s not going to happen. We’ll look closer at the business case for 5G in another post.

The open access model

New Zealand already has a tried and tested model for a separate wholesale layer. It’s called UFB.

The big telcos don’t like that model because by law wholesalers treat them the same as small ISPs. Spark can’t go to, say, Northpower and ask for a special deal “because we’re your most important customer”. That grates with the big carriers.

They also resent the wholesale charges. Remember the copper tax debate? It annoys telcos that the wholesaler gets 40 percent of each customer’s subscription.

Never mind that sum means the wholesalers gets a fair return on their investment. The regulator decides what’s fair.

The Chorus proposal

Which explains why the four big telcos scorned Chorus CEO Kate McKenzie’s proposal. She suggested that Chorus could provide the fibre 5G backhaul. They fear loss of control and they fear having their tickets clipped. The cost per mobile connection for such a service would be tiny. It would be far less than the cost of building a new network.

In reality one or more of the mobile carriers may end up using some Chorus fibre to backhaul. They may also use NorthPower, UFF or Enable resources. What they don’t want is another wholesale network muscling in on their turf.

Yet, it looks like they will end up with either Chorus or a regulated Chorus-like wholesale organisation. Only Spark could go it alone. But it has better capital expenditure options on than overbuilding a fibre network.

Disclaimer: Chorus pays me to edit the Download magazine and a weekly newsletter. It didn’t pay me to write about 5G backhaul. Indeed, this post doesn’t reflect anyone’s opinion other than my own. No one vetted or otherwise approved this. Any mistakes are down to me. Your corrections or alternative opinions are welcome.

logitech slim combo keyboardLogitech’s Slim Combo for iPad Pro keyboard is a mixed bag. Its good points are excellent. Its less good features are, well, disappointing.

I’m testing the 12.9-inch iPad Pro version. You can buy it nn the New Zealand online Apple store for $250. At the time of writing JB Hi-Fi has it for $230.

This compares with $270 for Apple’s Smart Keyboard. So it’s cheaper than Apple’s keyboard, but not a lot cheaper.

You can’t judge the Slim Combo without reference to the Smart Keyboard. The pair are a head-to-head choice. In some ways they are polar opposites. What one keyboard gets right, the other gets wrong.

Great typing

Let’s start with the keys themselves. Logitech’s Slim Combo feels great when you’re typing. Keys are back-lit. This makes it easier to use in low light conditions.

The keys have positive travel. They move more than on the Smart Keyboard. The keys stretch across 270mm wide and 95mm deep. That’s a little less depth that ideal, but the width is fine.

Each key is about the same size as on a normal keyboard: 15mm square for most keys. The top row of function keys are only half height. They are a little more cramped than on the Smart Keyboard.

In practice this means you can touch type on the Slim Combo without giving it a second thought. There’s no audible click, but enough of a clatter to let you know what’s going on.

If you loves Apple kit, but don’t like the new laptop keyboards, then the Slim Combo and an iPad Pro could meet all your typing-on-the-go needs. It feels better than the keyboard on Apple’s alternative.

The only negative I found with the keyboard is when it comes to reaching up and touching the screen. Somehow that is more comfortable on the Smart Keyboard.

During testing it felt fine. When, after testing, I retried the Smart Keyboard I realised I prefer Apple’s version. There’s not a lot in it and my preference could be a matter of familiarity.

Two parts

Logitech made the Slim Combo in two parts; the keyboard itself and a plastic case. This does two things. First, it turns the Slim Combo into a protective shell when you’re on the move. Second, there’s a Microsoft Surface-Style kickstand.

There is also a nylon loop to store an Apple Pencil. While handy, it looks a little tacky when the Slim Combo is new, I can only imagine it will get worse over time.

This sounds better on paper than the Slim Combo is in practice. While the keyboard is sound, the plastic case has a down-market feel.

It’s not as solid as I’d like. When you use the kickstand on a desk, there’s a disturbing wobble. You can’t use the Slim Combo on your lap — if that’s important to you — because the set up is too flimsy. I also found the Slim Combo doesn’t work as well on an airplane as the Smart Keyboard.

Another negative is the case is a pain to get on and off the iPad. My iPad Pro may be a laptop replacement when I’m on the move, but at home it’s a tablet. The case adds nothing useful at those times. It feels as if the Slim Combo wants you to use the iPad as a laptop all the time.

It adds bulk. While the Slim Combo is light, it is also bulky.

Logitech Slim Combo verdict

Logitech has made great iPad keyboards in the past. This doesn’t live up to the brand’s reputation. There’s not enough here to pull me away from Apple’s keyboard.

That said, the Slim Combo is a welcome alternative to the Smart Keyboard. Some readers might prefer its typing action and there will be others who like the kickstand.

Dragon Anywhere is the iOS version of Nuance’s Dragon speech recognition software. It’s a powerful dictation application that can transform how you work.

It needs to deliver: an annual subscription costs a nosebleed NZ$240.

At that price Dragon Anywhere is not a buy, try, forget app store experiment. It’s a significant investment. It needs to earn its keep.

Worth the money?

For some people Dragon Anywhere will be worth every penny. Accurate speech to text software can unpack a new level of productivity for some people. Not everyone will see a return on the investment.

If you already use desktop dictation software, you’ll have an idea of what Dragon Anywhere can do for you.

Being able to dictate text to an iPhone is a bigger deal than it might sound at first hearing.

The designers made the iPhone for dictation. Let’s face it, writing on a tiny glass keyboard is a challenge if you want to do anything more than send a text or a tweet.

I’ve written 1000 word stories on the iPhone. It’s not fun, nor is it productive. The alternative to dictation is carrying a Bluetooth keyboard. That can be a pain in the backside.

It also means you can replace desktop dictation with your iPhone. Given that your phone goes everywhere you do, it means you can produce text almost anywhere. This explains the product name.

You could, for example, write while in the back of a car or lounging in bed. In practice I found using the iPhone for dictation is more natural than using a desktop or laptop Mac.

Dragon Anywhere

Anywhere

Mobility is important, because ideas do not work nine-to-five in an office. Your writing muse can turn up unannounced at any time. With Dragon Anywhere you can jot down your ideas as they appear. There’s no need to hunt around for a computer or a pen and paper.

Your phone is already your most important computer. Dragon Anywhere takes that further. Depending on how you work, you may be able to ditch the desktop altogether. Although if you don’t want to, Anywhere integrates with Nuance’s desktop dictation applications.

If Dragon Anywhere save you buying a new computer, the subscription starts to look like a bargain. Even if you don’t go that far, your typewriter keyboard may gather dust.

Dragon Anywhere works anywhere there’s a connection

The software doesn’t quite work anywhere. You need a live internet connection. Dragon Anywhere calls on Nuance’s cloud resourced to work its magic. That means you can only use it when you have a live internet connection.

The good news is that it sips data. You might run through a megabyte or so dictating thousands of words. I found after an hour’s use, my data consumption was still measured in hundreds of kilobytes.

Another piece of good news is the cloud round trip is fast. Speak a sentence or two, pause and the text is there on screen. It takes seconds. I found I couldn’t dictate fast enough to get ahead of the cloud connection.

In other words, you can use Dragon Anywhere while you’re on the move. If you have anything but a minimal data plan you can use it without counting the bytes or hunting for Wi-Fi.

Nuance says it encryopts connections, so criminals can’t listen in on your dictations.

How well does it perform?

The performance is impressive. I used it to write a first draft of this review. From the first words I uttered it was catching almost everything without error.

The software stumbled over the word iOS in the first sentence. To be fair, it’s a specialist word. If you think of how you say the name: eye-oh-ess, not picking it up it understandable.

User error

It wasn’t the software that stumbled in the second paragraph. I can take the blame for not figuring out how to say NZ$240 in a way that made my meaning clear. Put this down to user error.

The third sentence was perfect.

Out of the first hundred words, Dragon Anywhere got everything except iOS right. That’s impressive. Remember this was my first try of the software. The software had not encountered my voice or accent before.

In practice it learns a little as it goes along. To see how this worked I read the words again and this time Dragon Anywhere scored a perfect 100 percent. It understood iOS. The software understood my speech far better than Apple’s own Siri software.

If you make an error, fixing your text is easy. The only barrier is that you have to memorise instructions. In most cases the words are obvious, you don’t need to guess them. Some take a little practice.

I ran into a problem with some New Zealand place names. That’s understandable. Dragon Anywhere allows you to add custom words to the system which gets around the problem.

The productivity question

If you notice, I hedged my words when I said the software could be worth the money. Likewise when I said it may transform how you work or make you more productive.

That’s because, good as it is, speech recognition is not for everyone. In my experience it takes longer to dictate stories than to type them. I also find I struggle to compose while speaking. This could be down to 40 years of touch typing. With practice my dictation speed might improve.

There are also times where I need to write and dictation isn’t the best tool. Writing on a train, an airplane or somewhere public would be too much for everyone else.

If you find typing is difficult or run into overuse problems, then its a godsend. If you think by speaking, you’ll love it.

Galaxy Note 9 sets new bar for Android phone price

This year a lot of people will pay NZ$2000 or more for a phone.

Apple set the tone at the end of last year with an NZ$2100 iPhone X. Now Samsung has joined the party with an NZ$2000 Galaxy Note 9.

You can pay less. A basic iPhone X with 64GB of storage costs NZ$1800. The more expensive model has 256GB.

Samsung has an NZ$1700 Galaxy Note 9 with 128GB of storage. The NZ$2000 model comes with 512GB.

Whether you need that much storage when cloud storage is plentiful and mobile data is cheaper is beside the point.

Inflationary

These are two examples of how New Zealand’s Consumer Price Index or CPI is the nearest thing to an official measure of inflation. In the most recent year, it was 1.5 percent.

That means consumers paid 1.5 percent more for a typical basket of goods and services in the year to June 2018 than a year earlier.

Expensive

At NZ$1700, the Samsung Galaxy Note 9 is $100 more than last year’s Note 8. That’s 6.25 percent higher: more than four times the CPI increase.

Apple’s iPhone X doesn’t have a year earlier model to compare.

Instead, we’ll look at the iPhone 7 and iPhone 8. When it launched the iPhone 7 was NZ$1200. A year later the iPhone 8 went on sale at $1250.

That’s a four percent increase. Apple’s markup is smaller than Samsung’s, but still well ahead of the CPI.

Everyone is at it

It’s not only Samsung and Apple. The prices of Huawei phone models climbed over the years.

Even Oppo, where the phone’s low price is the most important feature, has increased prices.

If anything, Huawei and Oppo’s price increases have been steeper than Samsung and Apple’s because they come off a lower base price.

But don’t phones get better

You might argue that the newer phones are better so phone makers can expect to sell them for more money. There’s something in this, see below.

Phone prices were stable during for years while annual upgrades meant huge leaps in functionality. Today’s upgrades are incremental while prices leap.

Apple shows the way

Apple has always lead the way on phone prices. It’s no accident it is the world’s biggest company and enjoys large profit margins. That trillion dollar valuation didn’t come by chance.

When it launched the iPhone X last year, Apple showed it could push phone prices above the NZ$2000 mark without denting sales. That opened the door for its rivals to charge more. They won’t admit it in public, but the iPhone acts as their benchmark.

Apple sells fewer phones than Samsung or Huawei.

The iPhone makes up around 20 percent of the handset market worldwide. It accounts for around 80 percent of profits from phone sales. Almost all the remaining profit from phone sales goes to Samsung.

Profits

It’s not clear how profitable the other main phone brands are. It’s not even clear if they are profitable. The companies don’t break out figures in the way that Apple and Samsung do. Yet it’s clear they are not making big margins.

Until a couple of years ago the Android phone market taken as a whole ran at a loss.

Things have changed. In part that’s because phone makers have pushed up handset prices ahead of inflation. It helps that some of the big names have either gone to the wall or wound down their operations.

Price rises have two sides

Inside the phone business, people talk about the average selling price or ASP.

According to IDC’s Worldwide Quarterly Mobile Phone Tracker:

…”climbing ASPs continue to dampen the growth of the overall market”

…”Consumers remain willing to pay more for premium offerings in numerous markets and they now expect their device to outlast and outperform previous generations of that device which cost considerably less a few years ago.

IDC says worldwide phone ASPs are up 10 percent in the last year.

Sharper prices lower down the market

Phone makers love to tell investors they have managed to increase the average selling price of their phones.

In some cases, they have done this by bumping up prices on their flagship models while fighting tooth and nail further down the market.

You can still get bargains. Spend NZ$500 to NZ$600 and you can end up with something great. It won’t have the latest camera or tonnes of storage, but not everyone needs those features.

High prices could be here to stay

New flagship phones are expensive to make, but the cost of building a phone is a fraction of the selling price.

Putting more lenses and more camera sensors may cost a phone maker a dozen or so dollars. OLED displays, curved glass add to costs. Perhaps the biggest extra cost is the memory chips needed to boost a phone’s storage, there is a trend towards higher storage in phones.

Higher phone prices are unlikely to go away soon. The glory days of fast-rise phone sales are over.

People are now holding on to phones for longer, squeezing more value from the money they have already spent. So it becomes important for each sold phone to contribute a little more profit.