Why Apple is getting into the cell phone business.
Steve Jobs got wind of the heavy lineup of video and music phones that are currently being brought to market, and panicked.
Well maybe not panicked, but it the iPhone is clearly a defensive move aimed at protecting the iPod economy, vs expanding into a new marketspace.
The iPhone is supposed to cannabalize iPod sales. It's out there so people won't ditch their iPods for a vCast phone.
The strongest feature the iphone phone will have is itunes integration.
It will succeed in holding off generic media phones for 12-18 months. (If you factor in the preannouncement, the honeymoon period, etc.) By that time Apple will have new models out.
This is a phone for people who have a standard voice phone, with perhaps the most advanced feature being custom ringtones, who also own an iPod. This would probably cover a vast majority of iPod owners. These users will at some point start experimenting with music/video phones as a replacement for their current two device setup. Apple needs to keep these customers on Apple devices to keep itunes valuable. (Right now they can use the strength of itunes to aid in this effort)
I expect that there will be additional applications and iterations of the iPhone (if Apple even ends being allowed to call it that) that will address some of the weaknesses of iPhone rev. 1. But let's face it treos are for geeks, and bberries are for email junkies. Apple abandoned the corporate market years ago. (Those with corporate issued devices don't use then as video ipods, they own ipods for that function)
By being the first major contender out of the gate to canabalize iPod sales, Apple stands a good chance at being the most sucessful.
- 04-17-2007, 01:29 AM #2
Ummmm DUH! I think it obvious to everyone and their mother that in the future most people will want to use their mobiles as mp3 players instead of dedicated players like the iPod. Jobs just saw the writing on the wall. The dedicated mp3 player market has reached its zenith and had no where to go but down just like the PDA market did for Palm. In the future, most people will use their phones as media players and will download OTA bypassing their PC's. Apple saw this like everyone else and the iPhone is a tactical decision as a result...
- 04-17-2007, 01:48 AM #3
In retrospect, it may all seem obvious, but this really is not so.
Some of the most successful features currently available in cellphones would never have been there in the first place... Cameras, for example. Cameras were put in cellphones to increase MMS usage, but nobody bothers with MMS anyway. Cellphone cameras have found a lot of other innovative uses.
On the other hand, some features that seem to be a natural "fit" aren't still available in main-stream phones (AM/ FM radio for one...). Nokia has a phone(s?) that has a torchlight LED. How novel and natural is that? Is it useful?
How about a phone that integrates an ear-bud and a toothbrush? that way one could clean their ears and brush their teeth while on a call.
- 04-17-2007, 11:13 AM #4
However, I agree with you that the iPhone plays a defensive role as well. One thing Apple learned a long time ago is, you have to bring out something new every year in order to stay hot. Last year it was the video iPod. This year it's the iPhone.
- 04-17-2007, 12:16 PM #5
With the MP3 market, it was so young and novel you just needed a strong, smart company to define what the player/interface should be: Apple did that with iTunes and ease of use UI.
Same with computers but they took a bit longer to really find their sea legs, hence it was really till the late 1990's that Apple starting making waves with it's innovations. Luckily computing was just starting to become a common thing amongst the population so they were able to get and keep (and slowly expand) a core crowd as the market matured.
Cell phones are completely different. Almost every American already has one, is familiar and inundated with advertising and literally a device for every function out there from the HTC Athena (mini, mini laptop pda) to tiny Nokias, chunky Treo's, etc.
They have to re-define what is known and expected from cell phones instead of just defining. That's a much bigger challenge. Plus, cell phone innovation is rapid. New devices come out every 3 months with some major new features every 6 months. Can Apple release a product that will still be relevant in 12 months? Sprint is getting ready to roll out 4g (WiMax) this year.
But I agree with the OP: the iTunes integration/keeping the iPod customers is probably their main goal right now while also expanding it as much as possible.