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Tuesday, June 10, 2008

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Thoughts on the iPhone 3G

Apple rolled out the iPhone 3G yesterday, or at least rolled out the announcement of it, making sure they will dominate the tech news at least until the end of July after the new device reaches stores on July 11. There was quite a bit of disappointment that the devices weren’t on the shelves yesterday, but it was probably a factor of timing and smart marketing that led to that.

I’ve made no secret that I think Apple is well on the way to knocking down a lot of its competition in the mobile space with a combination of the device and the Apple SDK. Nothing I heard yesterday changed that opinion. Apple will dominate this space, but not as soon as I think they’d like to. In the final analysis, yesterday, from a hardware perspective, was about delivering on things that should have been there in version 1 (and some things that are still strangely missing.) I’d call it evolutionary and not revolutionary. The real news was about marketing, and the infrastructure that will support Apple’s mobile platform. Here were the big announcements in my view:

Price: $199 for the 8GB phone and $299 for the 16GB, both with a two year contract. While that is de rigueur for the mobile phone industry (at least here in the states) there’s a bit of marketing trickery going. AT&T will be raising the price of the data plan to $30 a month which is $10 higher than previously. So, essentially over the life of the contract you’ll be adding $240 to to the cost of your phone, essentially meaning you’ll pay more in the long run. That said, the $199 price for the 8GB model will rock the smartphone industry to its core, as others try to compete with that low price point. Intriguingly, Apple and AT&T now make you make a trip to the store to activate the phone.

MobileMe: This is Apple’s move into mobile syncing and Web 2.0 and will replace .Mac. You’ll pay $99 per year for 20GB of storage and to be able to access your documents, email, etc… from any device (including Windows devices) with MobileMe. While I’m not thrilled with the MobileMe name (it sounds very Microsoftish to me) being able to grab “me.com” is a stroke of genius. MobileME will be going head to head with Microsoft Mesh and whatever Google will cook up for syncing and making documents accessible, but will prove very popular for those who want a one stop solution out of the box. MobileMe is out the door first with a real marketing push behind it. Mesh is still waiting in the wings at this point.

Exchange and the Enterprise: Apple is moving into the Enterprise and I think, with the exception of MobileMe, that is what yesterday’s announcements were all about. Apple will continue to grab consumer market share with the iPhone, but the real growth is in the Enterprise and Apple is heading there big time with Exchange support. Everything we’re hearing about the SDK will be cool on the consumer front, but I’m thinking what it does on the Enterprise level will be bigger in the long run.

The SDK: Perhaps the part of yesterday’s announcement that disappointed the most (based on what I’m reading) was news on the SDK. The disappointment stemmed from the fact that everything is still to come and not here yet. But I still think this is the piece that offers the biggest promise in the long run. This is where the iPhone will turn into a platform and not just a fancy phone with web browsing.

3G connectivity: Welcome to the club. More than expected and now it is here (or soon will be.) This will make a difference for many. And if you believe the keynote specs, depending on your area, (remember there are entire areas that aren’t in range of AT&T’s towers-hello, Vermont) Apple and AT&T have tuned things right.

GPS: This is the other hardware add. It will be assisted GPS using both WiFi and satellites to pinpoint your location. I see big potential here for applications that make use of this.

Any and all of those announcements yesterday were big moves and the price point is huge. But there were some things that didn’t make it into the iPhone 3G which I find curious. The missing items sort of belie Steve Jobs’ statement that they listened and added everything everyone asked for.

Video: While it has been proven that the current camera in the iPhone can do video (with the right hack) the exclusion of video and video streaming on the iPhone 3G is making Nokia breather a little easier today. If Apple had been able to include Video capabilities and still come in at the $199 price point, Nokia would have been sweating bullets.

BlueTooth: From what I’m reading and seeing, BlueTooth is still limited basically to phone calling. I don’t get this and the only thing I can figure is that Apple is dealing with some DRM legacy issues that won’t allow them to make a move here. That said, not adding stereo music and the ability to tether up a keyboard, or tether up the phone to use it as a modem are things that will give some pause.

Cut and Paste: This is a no-brainer and for the life of me I can’t figure out why this hasn’t been included. I’m sure this will be solved by a third party application at some point.

Flash: No mention as to whether or not Steve Jobs is backing off his previous no Flash on the iPhone announcement.

A last note. Did anyone but me notice that Steve Jobs did not have a new phone on stage, and that post keynote pictures for the new phones are very limited at this point? Curious.

Tags: iPhone+3G

Hardware | Apple | Mobile

6/10/2008 7:24 AM MST

Thoughts on the iPhone 3G Comments [15] | Digg This | del.icio.us | Citations

Tuesday, June 10, 2008 7:33:11 AM (Mountain Daylight Time, UTC-06:00)

What I'm hoping is that cut and paste wasn't sexy enough for Steve Jobs to include in a keynote speech. However, if cut and paste were upcoming, I'd have thought someone with access to the beta SDK would have said something? (Witness all the blog posts about Chinese handwriting recognition.)

Tuesday, June 10, 2008 7:45:49 AM (Mountain Daylight Time, UTC-06:00)

Apple, as I've said time and time again, is an incredible marketing machine. Of course, by marketing machine, I mean that they often lie and neglect to mention the minor details in their sales pitch.

I realize, of course, that Apple and AT&T are trying to maximize the amount of money they get over the long term, and subsidizing the costs by higher data plans is a good way to capitalize on that idea. It's actually a smart move because although the consumer pays more for it over the long term, it does make the device and services more accessible to users, and really that's what people care about. It's no longer the "rich man's" phone, in a manner of speaking.

As for other negligent decisions, I agree whole-heartedly on the cut/copy/paste issue. Windows Mobile Professional has had this for ages and while WM Standard has only just gained the feature with 6.1, I don't think it's fair to compare the iPhone to a WMS-based phone (although I noticed Steve's pathetic attempt to discuss memory management by comparing iPhone and WMS). Moreover, I'm really surprised they didn't increase the amount of RAM the phone has. In fact, it's hardly ever mentioned at all aside from the snide comment about memory management. Despite Steve's claims, I've had several coworkers with iPhones complain about memory issues. Maybe Steve just isn't as aggressive with his as some people. No MMS either, which is odd, but then again, neither do Sprint's WM phones like the Mogul.

Anyway, I stand by the fact that I'd never own one, but now that Microsoft has bailed them out in the Enterprise with Exchange Support, I can't fault anyone for wanting one.

GoodThings2Life

Tuesday, June 10, 2008 8:35:16 AM (Mountain Daylight Time, UTC-06:00)

on topic of the sdk, i guess it still needs a mac to run on...

if im not mistaken, android development, being eclipse based, can be done on win, mac or linux with equal ease...

turn_self_off

Tuesday, June 10, 2008 9:14:02 AM (Mountain Daylight Time, UTC-06:00)

Warner: I agree with your points on the hardware, but I look at the software developments or lack thereof in the context that this was announced at a conference for the developers. The software is still to come because the guys who will be making the software were just introduced to the new iPhone. Given the venue, I think it was best to leave things open for developers to fill.

turn_self_off: At last report, the new SDK needs the latest upgrade to Mac OS X, which I think is pretty logical considering the iPhone runs OS X. There are also the considerations for the multi-touch and accelerometer interface options that aren't needed for Android.

Sumocat

Tuesday, June 10, 2008 10:55:42 AM (Mountain Daylight Time, UTC-06:00)

Apple needs to THINK mobile phone. Today, that means the camera needs to capture video. My Mobile 2003 phone (still in service) that I bought in 2002 had video! It also had cut and paste. It was little tablet, able to recognize writing and allow me to take written notes.

That was then. This is 2008. Yes, I was waiting expectantly, but I find myself underwhelmed. Merging the iPod function with the phone and mobile note taking/scheduling is highly attractive, but only 16GB, esp. when the iTouch has 32GB? (I expect 32GB to show up later in the year, which I think many people may all expect, so that'll be a really good reason to wait.)

Had the machine sported video /and/ had the rumored front camera (even if only .5MP VGA) and video iChat to go with it, it would have /slaughtered/ the competition. It probably would have slaughtered the bandwidth of AT&T's nascent 3G network, too.

Though you may be right that there are DRM issues with allowing digital streaming of music through bluetooth that could go to a stereo headset and equally to a PC for capture, it is also a big zero that the completion will home in on like a bullseye. Other vendors handled it, why not Apple? If it turns out to be a battery issue, always burning fuel to stream to the bluetooth headphone... well, in that case, let the user know and let him choose. 24 hrs of music tethered or 7 hours with bluetooth... hmmm...

Will I buy? ...Maybe. Probably not July 11th. Take notes, Apple.

sfwrtr

Tuesday, June 10, 2008 11:27:09 AM (Mountain Daylight Time, UTC-06:00)

You pay extra for SMS now, too!

Chuck

Tuesday, June 10, 2008 11:27:32 AM (Mountain Daylight Time, UTC-06:00)

What's the chance that this will reduce the price of the Ipod Touch? From one standpoint how can you charge more for a product that has less functionality. I am sure Apple will say, yest but the price is subsidized by the phone contract. Here's hoping anyway cuz I'm not switching to AT&T just for an iPhone.

Kevin Purcell

Tuesday, June 10, 2008 12:02:52 PM (Mountain Daylight Time, UTC-06:00)

Honestly, I'm starting to doubt Apple. They're taking things way too slow for the current changing market, and failing to (at least publicly) challenge themselves in their product offerings.

We can see this in the keynote - the absolute brains behind Apple is Steve Jobs, no question. But how often was he actually up there delivering the keynote, when Engadget reported months earlier that Jobs was delivering it? Less than half - Scott Forstall was up there much longer delivering the demos (even if Forstall himself wasn't on stage, his portion of the keynote including the demos was longer). And Forstall honestly sucked yesterday - he shows little of the exuberance that Jobs brings to his executive position that brings confidence to investors.

Since the original introduction of the iPhone and Leopard, what has Apple done to innovate? They've pretty much just sat on their laurels refreshing product lines and adding features that don't really innovate. 3G and GPS are NOT new additions to phones! They are purely bullet points that were long missing from the iPhone. In fact, I (as a student) see no reason to upgrade my existing iPhone to a 3G model - I'm going to have WiFi all over campus, GPS isn't going to help me get around, and I don't see why I should pay an additional $10/mo for 3G as well as wait in the line for the clusterfuck that July 11 is going to be when everyone is mandated to activate in store.

Where's the new stuff? Where are the tablets? Apple could EASILY revolutionize tablets and completely rip off all the work that Microsoft has done but they're NOT. Where are the subscription models for iTunes? Why do we still have DRM on videos sold on iTunes, and why is Apple FairPlaying the iPhone apps (even the free ones)? This is not innovating - this is moving backwards, playing down to their opponent's level. Hell, why doesn't Apple license OS X to OEMs - they're afraid of diluting their brand name? Come on - Apple is a household name. Everyone has some Apple product in their house now, be it a Mac or an iPod or an iPhone, there are classrooms FULL of glowing Apple logos at universities. Apple is no longer an "exclusive" kind of brand, no longer the status-giver of the computing world.

wickedpheonix

Tuesday, June 10, 2008 12:15:28 PM (Mountain Daylight Time, UTC-06:00)

wickedphoenix: "Since the original introduction of the iPhone and Leopard, what has Apple done to innovate?" -- Dude, that was last year. I don't know how often you expect innovations to roll out, but every year is a bit much even for Apple. Nobody else even offers functional multi-touch yet. Wait for the other guys to catch up at least.

Sumocat

Tuesday, June 10, 2008 12:27:11 PM (Mountain Daylight Time, UTC-06:00)

This phone is a disappointment. I say this as an iphone 1.0 owner.

* still no flash - its not happening w./ iphone 2.0 sdk people: it has to happen at a system internal level.
* still a crappy camera (low mp / no flash)
* rumor on video-conference never materialized
* still no video recording
* essentially unchanged batterly life (which is not great - good for 3g maybe, but not great overall)
* f'd up plans from AT&T are back - where did the 'apple simplicity' promise go? what happened to the 'streamlined experience'
* and they're requiring a NEW 2-year commitment to purchase one, even if you are a current iphone owner. No thanks.
* and they dropped the price so now ever chav in the world can own one.

Not happy. Expecting a 'true 2.0' in 2009. I honestly think this was a piecemeal offering from Jobs to hit sales targets. But I think in the back of his head, he's had a good look at the telecom industry players and realized 'a. they don't know customer service, b. i can beat them at their own game, and, c. apple will be better for it'

Expecting a revolutionary (rather than evolutionary) iphone 2.0 in 2009. 802.11n for near / wimax for far with inbuilt voip. Jobs basically gives AT&T et al. a big 'f you' I'll be first in line to buy. But not this meager offering. Sticking with 1.0 - looking forward to software upgrade though.

Additional pet peeve (to add to my rant): for the love of God, people in the media and the market, please understand: the ORIGINAL iPHONE WILL ALSO GET THE SOFTWARE THAT THE iPHONE 2.0 receives. I've heard more people talking about the 2.0 as offering a new software experience. This is just idiotic. It tells me that they don't really know the product. They read a fact sheet and typed out their story.

Not happy - expecting better09

Tuesday, June 10, 2008 2:40:09 PM (Mountain Daylight Time, UTC-06:00)

@ Not happy - expecting better09

If you're waiting for a true next-gen iPhone, wait until 2012 when Apple's exclusivity deal with ATT is reported to run out. Once that happens, Apple will be free to create a CDMA version (assuming Verizon is still on that in 4 years) and Apple won't have to worry about bullshit like ATT forcing them to have activation in-store. You can see from the international iPhone releases and Apple's attitude towards unlocks that Apple doesn't really care what carrier you use the iPhone with, so they'll be able to focus more on the hardware once they're free of ATT.

How many phones have video conferencing anyways? Would be nice and innovative (see my above post) but it's not like getting a different phone is going to solve your problems now.

@ Sumocat - Apple doesn't care about how the rest of the market does, look at Microsoft and OS X - OS X is years beyond Vista in terms of almost everything but that doesn't mean that Apple is not going to do anything until Windows 7 comes out. And as for multi-touch, Apple could have demoed a prototype or idea on it with the promise of releasing in December or something, like a one more thing kinda deal and give a look at what's coming - Wacom introduced it's capacitive sensor, Dell has the N-trig sensor which can theoretically allow for multi-touch except that there aren't any apps or driver support from MS. Well guess what? Apple writes its own drivers, Apple writes its own applications like iWork so this really shouldn't be a hurdle for Apple.

wickedpheonix

Tuesday, June 10, 2008 4:35:59 PM (Mountain Daylight Time, UTC-06:00)

2012 is a long-time away. It would be interesting to see the actual contracts drawn up between AT&T & Apple - are their non-competition clauses so broadly drawn that it would restrict Apple from releasing a SOLELY wifi/wimax voip phone (with, say, a statutorily mandated ability to piggyback on analog for 911 calls) or are the exclusivity clauses only in terms of Apple agreeing not to produce cellular telephones for use by other domestic carriers.

The technology for all this stuff is already there: video conference with high fidelity is feasible. integrating flash into the os is feasible. A better camera is (of course) feasible. Etc.

The business end is also viable, IMHO: people respond to thoughtful, user friendly, intuitive environments, whether technological or business or retail, etc. I think one of the things that's getting the LEAST attention (that should be getting far more attention) is the silent death of the push by Apple to encourage AT&T to create straightforward minute/data plans with easy activation and a hassle-free experience. The industry (cell) is in dire need of this sort of shake-up mentality. (They remind me of the Big 3 in the 70s)

Really, the only thing we need is for someone to crack the much-touted but yet-to-be-delivered WiMax promise.

The whole thing could coexist with a more standard iPhone-for-cell-company. Charge a premium. Price it at $799. Whatever. That's why we have product lines. (I honestly expected a dual-model announcement yesterday, with a lower-end nanoesque and a higher end true 2.0 ... guess I was wrong)

not happy

Tuesday, June 10, 2008 5:27:46 PM (Mountain Daylight Time, UTC-06:00)

wickedpheonix: Actually, that comment was directed at you for your impatience. Nobody else even has functional multi-touch in the market yet, and what's in the pipeline isn't planned for handheld devices. Apple is all alone in that innovation. As for demoing a prototype, you don't really know how Apple works, do you? If it wasn't for the FCC, Apple wouldn't have announced the iPhone until it was ready to ship. I admit, it would be nice if all the things you want came true, but I think expectations that line up with reality are nice too.

Oh, one more thing, I looked back at what Apple has done since the iPhone and Leopard, and found the iPhone SDK. Not only did they launch the kit, but they also hooked up developers with a powerful distribution system and lined up a venture capital fund. That is quite a big deal for developers.

Sumocat

Tuesday, June 10, 2008 7:04:33 PM (Mountain Daylight Time, UTC-06:00)

I will have one - I was waiting on Exchange support... See you in line on the 11th!

Matt Faulkner

Wednesday, June 11, 2008 5:58:41 PM (Mountain Daylight Time, UTC-06:00)

Well, Yes Apple will be dominating the market, but a thing Apple are not good at is there consumers. lets just talk a bit about the old iPhone. thousands of costumers has been asking for copy / paste or cut / paste, but nothing happens. Even the new iPhone will not be able to do this. Why ? I personally have no idea, why they do not make this. It is a vital tool for any that has to communicate with a lot of people, and not share all the info. I have had the iPhone from when it came out and I'm still using it, many would say, " if you are not happy with it, get another phone ", but it is not that simple. Cause the phone is good and I love the mail ( it just doesn't support spam, so all your spam will go to your inbox, if the server you use is not a special kind ) and web browser. those things are great.
Why did the the iPhone not go well in europe. Well Europe is light years in front of USA, so it is easy to please US. To sell in Europe and Asia you need to have a "super phone" and to be honest the old iPhone was nothing close to that.
The new iPhone, will still have a hard time cause the technology is still old. 3G has been around in Asia and Europe for at-least 7 years. Europe was doing video calls on cell phones 6 years ago. Why do we not get that. why is there still no video camera function ?
Apple is great at hyping products and to make them work so well, you just need to have MOBILE ME. Apple is perhaps just for me a bit to "smart".
So conclusion on my long comment is that I do think Apple will sell a lot, but I hope that Apple will start getting up to the beat of the consumers and LISTEN to them, cause they don't

Jesper

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