Well, the only solution I could fine was http://www.Cellswapper.com – they get you out of any cell phone contract!

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.

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.

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.

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.