I believe Wall Street is deluded with the notion that starting up a wireless operator is as simple as launching a Web site. The big -- unattributed -- speculation this week is that Apple plans on bidding in the 700 MHz auction to get the spectrum necessary to launch its own wireless service.

Sure, anything is possible. But has anyone stopped to consider just how far-fetched that idea is? Running a wireless operator is a low-margin, labor- and capital-intensive business limited to a specific region -- the exact antithesis of Apple's business model.

Apple may have launched services before, but let's face it, running a Web-based online music store is a far cry from building and maintaining a wireless network with millions of subscribers. Apple deals in industrial design and manufacturing outsourcing, programming and technological innovation. How does that translate into customer call centers, managing truck fleets, building tower footprints and negotiating roaming agreements? The only thing Apple has in common with a carrier is that it owns storefronts.

So let's just say Apple wants to become the next nationwide wireless provider. Let's break it down:

Apple would be one of small handful of 700 MHz spectrum owners in the U.S., a frequency that requires a new radio, new infrastructure and new handsets. Apple not only didn't launch a CDMA version of the iPhone, it couldn't lower itself to support UMTS because there is no frequency harmonization between the U.S. and the rest of the world. And now we expect it will shell out the additional dough -- further lowering its margins -- to create a phone that would work only on a single domestic network, shutting it out of any other potential sales globally and from other network providers. Of course it could make a quintuple-band phone, but if it "cheaped out" on a highly useful radio like UMTS, I don't think it really has a strong desire to pile on any more chipsets.

Apple has always been a volume seller, targeting as many markets as possible. That's not just global markets, but platforms. The iPod migrated to the PC. Macs are now supporting Windows. Sure, it still controls the value chain when it can, as when it linked iTunes to the iPhone, but Apple isn't so stupid as to think it can convince 200 million wireless users to cancel contracts and switch carriers for the sake of its nifty music and data services. Remember MVNOs?

Ostensibly Apple would become an operator so it can ensure access to the customer, that its own services don't get watered down in another carrier's deck and it controls the customer experience. But Apple has shown it can dictate terms to the wireless operators -- look at the iron grip it has with AT&T. Furthermore, the trend is to move toward open access, not away from it. The 700 MHz auction already has open-access stipulations on some of its licenses. Sprint is promoting -- though it's been backing away of late -- a wholesale model for its new WiMAX network. And operators in Europe and Asia have been tearing down their walled gardens for years. Building a network from nothing seems awfully pointless if the industry has come around to your way of thinking by the time your first base station goes live.

And finally, the most obvious: Running a wireless network is a damn hard thing to do -- something most of you reading this already know. What new market entrants have we had in the last few years? Clearwire is pretty much it, and it has glommed onto Sprint. The industry's shrinking rather than growing as far as the number of players are concerned, and Apple, regardless of what new whiz-bang business model it might be concocting, will have to deal with the same headaches the rest of the industry has faced for years: dropped calls, discounting pressures, handset subsidies and cutthroat pricing competition. I'm not sure if any company, no matter how savvy and well run, has the ability to do that from scratch.

Maybe I'm wrong. Maybe Apple's geniuses will soon be donning hard hats and start doubling as tower technicians. I seriously doubt it, though.

Contact me at Kfitchard@telephonyonline.com.