CG reader Bruce sent us a note today pointing out an interesting aspect of the the iPhone decision. He writes:
A lot is being said about the exclusive Cingular deal, no 3G, and the high price for a phone. How about short term positioning this as a true “pocket pc”? It has a PC O/S, wifi access for online use, great screen, etc… If Apple wants to sell this through their own retail channel, without all of the Cingular baggage, why not just sell it as an IP-based device and downplay the phone capabilities?
What he’s saying, essentially, is why didn’t Apple pull out a mini-Tablet PC similar to the Newton with video iChat integration. Palm is on the ropes, Wi-Fi is ubiquitous, and Windows Mobile hurts to use. The market, it would seem, is there. Why pin their success on a carrier? It’s slow today, so please discuss.
Too early to mainstream. Apple couldnt risk leaving it.
Bruce is right on!! (Of course Bruce is also NW Guy ;) )
I’m not sure I get the actual question here. If I remember correctly right now the expectation is that iPhones would be sold both through Cingular stores AS WELL AS Apple Stores. The latter ones would be above mentioned contract-less PDAs that probably at some later point could be married with a Cingular contract.
Let’s not forget that Apple for sure is thinking globally here. The whole Cisco-Apple trademark story has been going around, and that fact that Apple holds the iPhone trademark outside the US has been given little attention from a business perspective. Obviously they want to sell the phone outside the US, which means outside of Cingular territory. Sure, they will probably find some carrier to partner with in Europe (O2 maybe?) and one in Asia, but I’m sure they are also planning on selling the device all over the world without binding you to a cellphone carrier.
Apple knows that there is a possibly large group of potential customers who don’t want to or can’t switch over to Cingular, but who still want to be able to pull out their iPhone while sipping a Latte Macchiato at Starbucks to find out what the best way to cousin Franky is. And Apple will cater to that crowd. Can’t hurt to just put a couple of $800 iPhones without contracts on the Apple Store shelves and see what happens. I wouldn’t be surprised if they sell like a limited blue 32 GB version of the Nano (which does not exist and I’m not trying to start a rumor, I’m just illustrating a point).
So, to answer Bruce/John’s questions, nobody ever said that they wouldn’t exactly do that, and I won’t be surprised to see it happen as soon as the FCC puts their seal of approval on it.
I don’t have a problem with the way apple are marketing the iPhone and the phone capabilities. There is drawbacks to every gadget.
Steve emphasized the desktop class applications on the iPhone. So I guess the OS is capable of supporting other apps. But without a hard disk, the iPhone probably won’t work like a pocket PC as is. Steve didn’t demo how the iPhone would work with a .Mac account. Perhaps a hard disc is not needed if the .Mac account provide the storage.
I’d agree that it does not take much change for Apple to release a pocket Mac that is very similar to the iPhone. On the other hand, a pocket Mac without the phone capability does not make sense either. So I guess a beefed up iPhone with more storage makes more sense than taking the phone capability out.
Whatever the capabilities, it’s the marketing message which carried the announcement around the world, everywhere from Australia to Zambia.
There are well over ONE BILLION ***phones*** on the planet.
A phone is a concept that resonates with people, whereas the market for PDAs is shrinking rapidly and most makers of them have had to reposition themselves as smartphone makers.
Besides, justifying repositioning the phone based on the negatives:
- Cingular
- no 3G (yet… re-watch the keynote: Jobs specifically mentioned the term, and I bet by the time the phone reaches Asia and perhaps even Europe it will have be iterated in)
- high price
doesn’t take into account that the negatives are from armchair experts who are very familiar with tech specs but not how the market works. Compare the positives:
- Cingular: biggest US carrier (56 million users), provides GSM which is the most widely used mobile phone standard in the world (with all the future evolution and R&D that entails), and the partnership allowed innovations such as visual voicemail, which wouldn’t have been as achievable with a free-to-choose carrier approach.
- no 3G: first version of the phone is for the US market, and 3G equipped towers are still in the process of being rolled out, so coverage is very spotty. Second version of the phone will almost certainly have it, possibly in time for Europe, certainly by the Asian release. By that time, 3G coverage in the US will make it viable.
- high price: first iPod was $399. “It’ll never sell.” 80 million iPods later… Mercedes or BMW = 2-3x times the price of a feature for feature equivalent Ford or Toyota. People are prepared to pay for a quality, featured product with a bit of brand cachet.
Because no one outside of the demographic that can recompile a kernel owns a PDA (well, business guys too I guess) But *everyone* has a cell phone.
Funny, I was thinking earlier today that the iPhone is very like the Newton in a way.
The Newton failed because it was too big to be a PDA, and lacked the power of a laptop. It was somewhere between the two, neither fish nor fowl.
Similarly, the iPhone is too big to be a mobile phone, but lacks the power of a smartphone because you can’t put your choice of software on it. So I’m kinda unsure whether the target market exists. Presumably Apple have done some market research to prove that it does.
Why should common sense get in the way of bad business?
I agree with Reg. I think they want to enter the mobile phone market rather than the PDA or tablet market. But this version of the iPhone maybe be overkill for many people. We’ll see future revisions soon enough….eventually.
iPhone is available with Cingular ONLY!? And what if I am stuck under contract with a carrier OTHER than Cingular but still want a iPhone?
Well, the only solution I could fine was http://www.Cellswapper.com – they get you out of any cell phone contract!
For those of us who were there at the launch of the Newton at Boston’s Symphony Hall, there is a lot to like about the iPhone that the Newton lacked. First, it has built-in wireless. Second, it has reliable syncing via iTunes. Third, it’s a phone! And for those of us who bought the first iPod, it is amazing to see how far Apple has pushed the form factor of its music player. It will be amazing to see what shape future iPhones take.