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How To Respond To The iPhone?
from the Insight Community by Vinaya.HS
There’s a reason why mobile phones today suck. The guys who manufacture these phones literally have no control over what goes into them. That control instead lies with the powerful wireless carriers who often have the final say over how the phones are bundled and sold. Now, did we miss anyone in this equation? For sure and here lies the industry’s root cause for misery: an absolute disconnect with the customer. Of all the companies out there, it’s Apple that’s decided to boldly turn this industry head over heels by wresting control away from the carriers and making an attempt to reestablish that connect with customers, with its revolutionary iPhone.
I believe that the concepts behind the design and marketing of the iPhone are sure to sweep in unprecedented changes not just to mobile phone manufacturers but also to mobile network operators. It’s not realistic to expect an overnight turnaround in the industry, but I think it will certainly happen over the next two to three years - but only after the other device vendors have made a quick trip to the bottom trying to copy Apple.
The effect of the iPhone on device vendors
When was the last time you found your Nokia whatever-series-phone usable as a phone? Anyone remember the N90 weapon of mass destruction? Do you long for those times when your mobile phone offered crystal clear call quality, exceptional battery life, rugged reliability, and clean interfaces? I sure do.
The iPhone is Apple’s message to other device vendors that it’s OK to experiment but experiment while religiously keeping the end user’s sentiments and needs in mind. Your customers want their mobile phones to be, above all, phones. Don’t try to differentiate yourself from the competition by dreaming up and then dumping hare-brained features on your customers. And worse, don’t copy. But that’s exactly how Nokia, Samsung, LG etc. are responding to the iPhone. And so long as they do, they’re never going to be able to really respond. Nokia’s CTO Tero Ojanpera recently said that "Optical sensors and touch will be the next big things...I believe there will be a lot of innovation around these." I’d like to ask him this question: "Mate, is copying a proxy for innovation in your dictionary?"
And finally, there’s Apple’s crystal clear message that it’s quite OK too to stand up against a bullying carrier, but make sure that you have a killer product - that other carriers would die for - in your pocket.
In the next few months, we’ll probably only see iPhone clones (optical sensors, touch screens et al.) from most of the device vendors hoping to ride the iPhone bandwagon. But in reality, it’s going to be a very quick to the bottom of the ocean. A few manufacturers might trumpet the lack of 3G on the iPhone, but how many people are really happy with the crappy 3G services out there?
The effect of the iPhone on network operators/carriers
The Apple and Cingular deal represents a paradigm shift in the relationship between mobile phone manufacturers and network operators. It is the first instance since the explosive growth of the telecom business that a phone manufacturer has the network operator pinned to the wall. Reportedly, Apple retains complete control over the handset and what runs on it (design aspect). Apple also controls how and where the phones can be sold (marketing aspect). Further, Cingular stores cannot undercut the Apple stores on price, thereby marking the start of a trend where network operators no longer subsidize phones. Where I come from (i.e. India) this has always been the trend - you buy the phone and then pick the operator. Apple gets a cut from each subscriber’s monthly bill. The strategy here is to project the iPhone as a data-centric consumer phone and then get more and more customers to use more and more data services.
As reported in the Wall Street Journal, Steve Jobs referred to telecom operators as "orifices" that other companies, including phone makers, must go through to reach consumers. While meeting with Cingular and other wireless operators he often reminded them of his view, dismissing them as commodities and telling them that they would never understand the Web and entertainment industry the way Apple does. For today’s carriers, accepting the fact that their networks are nothing more than dumb pipes is very humbling indeed.
Verizon, Sprint, and T-Mobile all say that they are geared up to battle the iPhone, but to date none of them has outlined a strategy for doing so. Verizon stands to lose the most from the launch of the iPhone and their management should be ruining the day they declined Steve Jobs’ proposition. Probably they were thinking of the failed Moto ROKR - iTunes - Cingular combination. I bet that a huge chunk of Verizon customers will switch over to Cingular even though the associated cost of iPhone ownership is high. Verizon has clearly lost the first-mover advantage and will probably adopt a wait-and-watch approach. Sprint is anyway losing customers to AT&T and has other headaches to grapple with. T-Mobile is small chow and will probably ride on the iPhone’s data services bandwagon to get its customers to use data services.
It is reported that more than 1 million potential customers have made inquiries about the iPhone and, interestingly, about 40% are with the competition today. Many of them have apparently declined to re-sign annual commitments with their current providers so they'll have a chance to check out the iPhone.
Final comments
Apple is slowly, but surely, building an industry around itself: a product awaited with bated breath; a hungry carrier eager to please Apple in every which way; an ever expanding entertainment portal in the form of iTunes; content deals with YouTube - the current Mecca of the Internet (and who could ever have imagined YouTube converting their videos into H.264 just for Apple!); and who knows what’s up next. I think this is what Andy Grove refers to as the 10X change in the marketplace that catches you sleeping.
And as Brendon McLean over at The Register says, "What could be more scary than an organization capable of working in total secrecy, with a track record of creating highly desirable products, headed by a man who's beaten cancer and an SEC investigation and comes equipped with a Reality Distortion Field that would make Darth Vader jealous? Frankly, it’s just what the doctor ordered for this very sick industry."
The real question then is: "Can anyone respond?"
Reader Comments (rss)
Catch up time
No one will be able to respond, at least not in any way which will REALLY challenge the iPhone. By the time someone DOES come up with something which that could give Apple a run for their money, Steve will pull something out of his sleeve which will leave the competition in the dust. He's always one step ahead of the competition. He did it with OS X and the iPod, and he'll do it again with the iPhone.
"In the next few months, we’ll probably only see iPhone clones (optical sensors, touch screens et al.) from most of the device vendors hoping to ride the iPhone bandwagon. But in reality, it’s going to be a very quick to the bottom of the ocean."
Couldn't agree more.
Article Grammar
It isn't "their management should be ruining the day".
It's "their management should be ruing the day".
It isn't "Sprint is anyway losing customers to AT&T and"
It's "Sprint is losing customers to AT&T anyway, and"
The rest of the article's grammar and word usage errors leaves a great deal to be desired.
Journalism standards continue to creep downward.
Chuck Norris will defeat the iphone
Chuck Norris will defeat the iphone
RainOfSteel
Dear RainOfSteel,
Shut up. No one cares about your pretentious corrections. If you were really so familiar with the rules of writing, you'd be the one with the journalism gig and not just some asshole playing grammar police on the internet.
RainOfSteel's comments
Hey RainOfSteel, thanks for the grammar lessons. I am so glad you swooped in and saved the day. Oh heaven's me, where would I be if you hadn't pointed out that it was ruing the day? Are you a superhero? If not, you should invest in spandex, because you deserve to be a superhero. Us stupid and shameful commoners who lack grammar and proper word usage skills need you. We love you. Please oh please help us!!!
Actually, get over yourself and all your special grammar and spelling skills and get a life.
I loved the article improper grammar and all. Thanks.
shut up
"Your customers want their mobile phones to be, above all, phones"
thats obvious but im sure you want more than just a phone :-p
shut up
"Your customers want their mobile phones to be, above all, phones"
thats obvious but im sure you want more than just a phone :-p
shut up
"Your customers want their mobile phones to be, above all, phones"
thats obvious but im sure you want more than just a phone :-p
RainOfSteel
Asshole standards continue to creep upward. Gotta try harder next time.
Isn't apple touting the iPhone as an iPod, webbrowsing, camera, organizer phone? Sounds to me like apple is putting more features than anyone else is into a phone. They're not making it "simply a phone" as you try to portray it.
RainOfSteel is an idiot
The grammar which the author has written is good enough.
Atleast you understand whats written. If you are so worried about english grammar dont read articles on internet. Internet is a place where anyone and everyone posts their opinion and its their right to write it in their own way.
Halp!
Rain of Steel, ken yoo help me to lern beder gramer? I upreeshe... apreeshee... epri... uh, Thanks!
oh brother
RainOfSteel,
Relax man! Unless you are writing for formal publication, no one cares anymore! Even the VP of my office that makes a half a million a year uses informal grammar when writing emails.
Plus, this author is Indian. How much do you want to bet that his Indian language skills are better than your English skills?!?
I liked reading the article. I don't care about minor mistakes like that.
The critics don't "get it".
It's not just a phone. The iPhone, like the iPod, the Intel switch, Boot Camp, and Apple TV are interconnectable building blocks, like Legos. Building blocks not just for competition in computers, operating systems, browsers, music players or phones...but for a coming convergence-world of integrated personal electronics and entertainment. Steve Jobs vision is far beyond the monopolistic business practices of single-business manufacturers and services.
Church and State
I just want to know how long it is going to take for me to be able to purchase an iphone, and then choose my carrier?
Fine Article
Vinaya, I'm so glad you put your thoughts forward in this article. Those who don't recognize the innovation and execution from this company can't see very well. But now Apple has become a very astute business force to be rekoned with. Great article, Aaron
alexis
Actually, all I want/need is a phone that works well and is easy to use. I have so many bells and whistles on my phone that I don't know what to do with it. I use none of them.
iphone
It is a shame that Verizon did not got the iphone.It would have put out of business all this ATT,Sprint,and so on providers.It is a shame and stupid.Now I have to buy an iphone and wait 5 years to activate it or I should just switch to att wich is useless.what a shame .Verizon has a great signal,but once again the people with horrible signal get the best phone.
I will have to see first an iphone to give an fair review,it might be just a hype,but again apple is apple...
carriers
I agree with adrian, seems like the carriers with the bad signals always get the best phones. I'd like to see a win/win pair up sometime.
Grammar? When you're writing about the iPhone?
I guess the iPhone does voodoo to your grammar. :-)
Try something new
Apple should have embedded a universal reader to navigate the mobile web. I would like to just qode it.
The reader will let you click on barcodes of any kind, logos, trademarks, keywords, RFID, billboards, slogans, etc., to receive instant information. Direct navigation to content. When will they have a clue???? Who wants to type?????
What happens when I can "say it" into the browser?
Could it happen when they release a 3G phone????
iphone
the 'critics don't get it by Hardman 'is dead on .that is the truth behind the i phone mania. Steve Jobs aims high in his design- truth,simplicity,function and beauty..among others. thats pretty high for a material object.
Grammar
Hahaha man, do you guys know that words are made up of letters? And then if you use some of other letters, you get, like, a different word? 'Cause that's how it works. This is gonna be hard, so I'll go really slowly:
If you want to say that you will be "rueing the day something happened", you should write "rueing" and not "ruining" or "my nutsack is itchy" or "I don't speak english good". Otherwise people will not know what you mean. That's how words work. Some words mean some things, some words mean other things. Do you guys know what "ruining" means? Probably not.
That's not grammar, you morons. It's using a different word than the one you meant. Defending an illiterate idiot only makes you look like an illiterate idiot.
Extra credit: why is this sentence from the above article illiterate?
"Where I come from (i.e. India) this has..."
Too bad the iPhone does not connect to business messaging like many other phones do. Business users are one of the most important markets, and the iPhone does not have that functionality. That is a deal breaker for many people.
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