A victory of usability and one clear victor
The cell-phone consumer


Suffice it to say that iPhone is what you could at most have dreamed about, yet as soon as you see it you may well say: This is it! Any more appreciative talk about iPhone, the product, is akin to belaboring the obvious. Analyzing iPhone, the experience, can yield useful insights. Defining the iPhone experience at the intersection of the iPhone product and AT&T' Edge service is the first step. And here's where the problems start for the iPhone experience.

Indeed, AT&T Edge is so inadequate that one is left wondering why Steve Jobs is betting the (early) commercial success of iPhone on a sub-par communications network. For one, Jobs knew better iPod, the product, had to be complemented by iTunes in order to make a successful iPod experience. And, to top it all, AT&T and iPhone are in a long term exclusive relationship. At this time, for all we know, AT&T is working hard to update its network to 3G and has the lion share of the cell-phone market in the US.

This situation begs the question of the nature of the deal behind such marriage. Financially speaking, at least until AT&T gets to 3G, it could be a zero-sum game: Whatever Apple misses due to exclusivity, AT&T pays back in one way way or the other. And, as if to keep a 1/2 ace in its sleeve, iPhone has Wi-Fi connectivity.

Moreover, to protect its own iPod franchise, the storage capacity of the iPhone is rather limited and no extension slot, for memory or applications, is provided. This is despite Apple's calling the iPhone the best iPod to date.


What are the other players in the market going to do?

Nokia is probably the best positioned to counter Apple's iPhone. If MYLO is any indication, Sony/Ericsson will most likely keep overreacting with some feature-laden product. Samsung still has to overcome technology hurdles to play in the premium segment. Motorola and Palm will take at least a temporary hit until they can turn on real innovations. RIM is probably protected until the market figures out whether or not iPhone is a contender in corporate email.

The discussion for wireless carriers goes in two directions. For US-based carriers, the best hope is to roll-out products mimicking iPhone before AT&T upgrades its network. The non US-based carriers will most likely enter some sort of mating dance contest to win Apple over--the market leaders will be the probable winners.

Regardless the strategies each player will implement, there is already a clear winner, the consumer.

For those readers who are still to get their hands onto an iPhone, I suggest watching the following two clips as a good approximation for the better half of the experience:






4 comments:

Anonymous said...

it really restores the confidence in oneself for an ignoramus like myself in the ability to master such gadgets

Anonymous said...

On LinkedIn you posted 14 days ago the following clarification:

Thanks for the replies. It looks like iPhone is a unqualified success with its current customers. Time will tell whether iPhone will go above and beyond iPod's market success.

Meanwhile, would you please care to comment on the AT&T network? Are you happy with the internet connection as is?

Secondly, is Wi-Fi an open gate to augment the iPhone experience by, say, launching Skype and such?

I guess the hypothesis at work here is to check whether convergence happened on the 29th of June 2007.


Very well put, iPhone is not the real convergence "thing." Here's what Motley Fool has to write about this:

Google: The Real iPhone Killer

http://www.fool.com/investing/general/2007/07/23/google-the-real-iphone-killer.aspx

Dave Mock
July 23, 2007

The dust is still settling from the iPhone tornado that blew through a few weeks ago, as Apple (Nasdaq: AAPL) and AT&T (NYSE: T) now bask in the glow of brisk sales of the combo phone and media player. But the debate is still fresh over the "revolutionary" new device, with many contending that the iPhone is merely a veiled evolution of an old regime.

If you're not sure where I'm going with this -- and how it connects with Google (Nasdaq: GOOG) -- let me explain: The iPhone was heralded as a revolution in the world of cellular services. According to some, the enigmatic device was supposed to rewrite the rules of wireless services by putting the "true Internet" in your pocket -- not the limited, walled garden of content that carriers including AT&T, Verizon (NYSE: VZ), and Sprint Nextel (NYSE: S) currently supply.

But many are arguing that Apple and its exclusive carrier AT&T have hobbled access to Internet sites and content with a locked device restricted to relatively slow speeds when on AT&T's second-generation network. Developers complain about limitations not experienced on other smartphones that utilize Microsoft's (Nasdaq: MSFT) Windows Mobile, for instance. And many argue that the $500-plus unsubsidized price tag for the iPhone should give users the privilege of complete control of its use and access to content.

So where does Google fit into this? Rumors say Google is contemplating a "GooglePhone" that would truly be a free-access device -- one that accesses open, ubiquitous broadband networks in the same way PCs can connect to Wi-Fi networks today. The thinking is this: An ISP or broadband provider doesn't dictate where and how you browse the Web, so why should wireless telcos? While Apple may be moving toward a more open Internet experience, Google wants to start there.

To get there, Google confirmed in a letter to the FCC that it would bid a minimum of $4.6 billion for 700 MHz frequency licenses in the upcoming auction if four conditions for open access, devices, and applications are stipulated on the spectrum. Google and Yahoo! (Nasdaq: YHOO) have long argued for rules that specify open-access wireless networks in a portion of the band, rather than having to pipe content through incumbent carriers -- at a price.

The debate has a long way to go, but if Google and other open-access proponents are successful in lobbying for changes in the rules, truly revolutionary wireless devices may succeed in making the iPhone a relic of a past regime.

from a newsgroup said...

I am at my wits end with Cingular ---

I have tried Nextel, Sprint, ATT became Cingular now ATT again and really
the only ones left for me to try are

Verizon and T-mobile - I thought about sticking around Cingular because of
the iphone, but at this time I am so ticked at Cingular that I rather forget
about the iphone.

I hate Cingular because:

o My calls get DROPPED ALL the time anywhere and everywhere in
Austin.

o I cannot make calls or receive calls inside my house; I always have
to walk outside.

o Because of it, I signed for the call-forwarding plan, now they
changed the terms (because it is their right to change terms anytime) and
now all forwarded calls come out of my air time minutes - so what is the
point to have call forwarding?

o Most often than not, I get alerted that I have a NEW voice mail 3
or 4 days later after the voice mail was left.

o I can only save message for 14 days, after 14 days Cingular decides
I do not need my saved voice mails anymore and deletes them.

o I called customer support, their answer (that is the way things
are, and they cannot restore the erased messages)

o I have been out of a contract for about 3 years, so they have no
intention to help me unless I renew the contract.

o I do not even use the rollover minutes, most of them expire before
I get to use them anyway.

Any carrier plans anyone can really vouch for? - I have not tried Verizon
and T-Mobile.

Costco has some good phone plans and there is no sign up fee or activation
fee and they give me all the gadgets (car charger, home charger, etc) for
free as well. Their phone selection however ---- -> SUCKS!!!!

I am inclined to try Verizon because of their (*try us for 30 days) offer, I
do not care what phone I get anymore - I only want to be able to receive
and make phone calls - I do not care for texting or SMS, and could care
less about video and tunes on the phone - So why would I want an Iphone you
may ask?

I just want a phone with a phone book, and I can make and receive calls -
That is it!

fCh said...

http://bits.blogs.nytimes.com/2007/09/17/losing-money-on-the-iphone-and-making-it-up-on-volume/