Apple was recently awarded a patent describing a wireless selection system that would require carriers to compete for service on an iPhone. According to the patent, the phone would store the network settings for a variety of carriers and select the appropriate service based upon information sent to the phone from a wireless operator. Rather than put the carrier in control of activating service, this system would put the phone and its owner in control of selecting a cellular service provider.
The filing describes a bidding system that lets competing carriers send rate information to the handset. The phone or the user would parse this data and select the most favorable rates for any given geographical location. Interestingly enough, the patent lists Verizon and Sprint as an example of competing carriers that could use this system. This selection service would let Apple act like an MVNO with billing to be handled through iTunes.
This MVNO system is reminiscent of the upgradeable, integrated SIM that emerged last October. According to this earlier rumor, Apple was working with SIM card manufacturer Gemalto to create a cross-carrier SIM card that would let users switch carriers without obtaining a carrier-specific SIM. Carrier response to this proposed SIM card was overwhelmingly negative with several European carriers threatening to drop the subsidized iPhone if Apple were to pursue this SIM card design.