BusinessWeek has an interesting but slightly over-the-top story about the misery the iPhone 3G will inflict on the rest of the wireless industry. It’s quite maudlin in its focus on the needs of the establishment wireless service providers. It even seems to mourn threats to the dominance of the existing wireless carriers. Perhaps the only news to glean in between the forecasts of doom is that Palm, once the dominant player in Smart Phones is now too niche to merit a mention in a round-up story like this. Apparently, the hole Palm needs to climb out of is so deep that the iPhone 3G’s coming ubiquity doesn’t even make things worse.
AT&T announced to its shareholders that it’s iPhone agreement with Apple underwent some substantial changes with the release of the iPhone 3G. AT&T’s press release reads:
“The new agreement between Apple and AT&T eliminates the revenue-sharing model under which AT&T shared a portion of monthly service revenue with Apple. Under the revised agreement, which is consistent with traditional equipment manufacturer-carrier arrangements, there is no revenue sharing and both iPhone 3G models will be offered at attractive prices to broaden the market potential and accelerate subscriber volumes.”
Now of course this substantive change in agreement between Apple and AT&T has the net all a twitter with the possibility that Apple will begin marketing the iPhone 3G on other networks. Even AT&T’s statement that their relationship with Apple is now “consistent with traditional equipment manufacturer-carrier arrangements…” would seem to imply that Apple’s side of the arrangement is also “typical”, meaning that after a predetermined period of exclusivity, they can market their handsets to other carriers.
There are articles at CNET and MacWorld that arrive at this conclusion, and speculate that Apple soon will market the iPhone 3G on other carriers in the US.
The only difficultly is, that it ain’t gonna happen, not right now or anytime we’d call “soon”.
That’s because there’s only one other national GSM carrier and T-Mobile’s 3G network is Voice Only.
That tends to suggest that there isn’t what we call a “Business Opportunity” for iPhone 3G on T-Mobile’s network right now. Of course original iPhones running software 2.0 would be great to have, except Apple seems to have stopped making them.
(note: there are technical details in the comments that are too boring to include in the post)
Steve Jobs made an interesting disclosure to the NY Times yesterday while talking about the remarkable Grand Central technology in Mac OS X Snow Leopard that will allow programmers to get more power out of multicore computers and also to use GPUs for additional performance. In the midst of such talk, he announced for the very first time the reason that Apple purchased processor-maker PA Semiconductor in April.
“PA Semi is going to do system-on-chips for iPhones and iPods,” he said.
Many had speculated that future iPhones could run on Intel silicon, or that PA Semi had been purchased just to recruit some of its talented engineers. Steve says otherwise. Apple’s getting into the mobile processor game. Two years from now, all our iPods and iPhones might be running on their hardware. And if PA’s stuff is as good as everyone says, such exclusive hardware could maintain the competitive advantage that software already offers the iPhone.
Now the dust has settled, and the excitement has waned, it’s possible to calmly reflect on yesterday’s iPhone announcements. Only the excitement hasn’t really waned, and the only reason the dust has settled is because I can’t run to the nearest O2 shop and grab an iPhone 3G yet.
Ultimately, Apple delivered. Most of the rumor bridge went away satisfied, with the revamp being lighter, more efficient, and including both 3G and GPS support. Yes, the camera is still rubbish, and the lack of a front-facing camera still irks some, but most people are happy with the upgrade. (Well, apart from the idiots web-wide who are rattling on about HOW UNFAIR it is that Apple had the audacity to release a new iPhone when they bought one JUST LAST WEEK, and how APPLE IS EVIL, and so on.)
Also, the pricing rumor turned out to be pretty much spot-on. The iPhone’s going to ship with a price-tag of just $199 (for the 8GB model—the 16GB model is an extra hundred bucks), and so even with the still fairly hefty monthly contract, it’s now a lot more affordable. Clearly, Apple is gunning for market share (its estimate of 10 million iPhones sold by the end of 2008 now looks remarkably achievable), to get its platform ingrained in people’s minds as the obvious choice for anyone after a smartphone.
From a British standpoint, things are looking even more rosy. I recently bitched about Apple’s over-the-odds charging in Europe, and it seems someone was listening. Not only is the new iPhone priced in a straight US dollar-to-Sterling conversion (I was expecting $199 to become £139, truth be told, not £99), but also Brits retain existing tariff pricing (reports suggest AT&T’s raising its prices), and get a new tariff at the £30 mark (even if its minutes and texts allocations are both utterly miserly). Handily, existing iPhone owners forking out £45 or £75 per month also get the new iPhone as a free upgrade.
The only disappointing thing is that I now need something else to complain about. Ideas on a postcard…
UPDATE: Confirmation about AT&T’s price-hike suggests that there’s still something to complain about, at least if you’re in the US. Despite the hardware price-drop, the overall contract cost for the 8GB phone is now an extra $40 over two years. If anything, this makes the pricing in the UK even more surprising. Still, perhaps Apple will actually be able to sell some iPhones in Britain now.
Update: Reader imajoebob has got a really funny response in the comments. Worth a read.
Trying to write this post on a Blackberry has taught me something, this thing’s web browser stinks. Now that the 3G iPhones will be on-sale in July, I’m gonna hafta break-down and get one. That said, only one-question remains: How to hide the purchase from my wife?
After the break, we’ll talk through my strategy, in the hopes that a fellow husband in a similar pickle might benefit from my experience, or maybe even able to help me devise a better strategy.
I heard two interesting tidbits about the possible design of the iPhone 2 at the weekend:
Better Battery Thanks To Better Software
3G is generally assumed to be a drain on battery life because of the hardware, which sucks down juice, but it is actually the iPhone’s software that is the problem, according to engineers working on Google’s Android phone. According to a conversation reported to me by a colleague at Wired.com, Google’s engineers say the first iPhone OS was basically a hack. It was adapted from the desktop OS and had none of the advanced power-management features necessary to properly run the networking chips. But the iPhone 2 will have not only better integrated circuits, it will have proper power-management software also.
The iPhone 2 Won’t Have an All-Plastic Case
There are several rumors speculating that the iPhone 2 will have an all-plastic case, replacing the metal back of the current design. But an engineer I talked to last year said the metal cases of the iPod and the iPhone were probably designed to dissipate heat from inside the device . They were likely big heat sinks. And that’s why I doubt the iPhone will have a plastic back, because plastic doesn’t conduct heat as a well as metal.
The Guardian says that in some cases, the iPhone will even be free to new subscribers:
… the handset will be offered at lower prices – or even for free. Those who sign up for a contract costing £75 a month will be offered the handset for no extra charge, breaking with Apple’s earlier attempts to avoid the large subsidies common in the rest of the industry. Elsewhere, the gadget is likely to be subsidised to lower the price, which could drop from £269 to as little as £100.
Good heavens, but a lot can change when you get on one plane. I just arrived in Atlanta (friend’s wedding), hopped online, and the Intertubes have gone mad with credible leaks for the iPhone 2 that is universally expected to be introduced at Monday’s WWDC keynote. None of it is 100 percent confirmed, obviously (lots of commeters are skeptical about the missing lock button on the RED model), but these are much better than typical pre-keynote speculation. Here’s what you need to know:
True iChat mobile looks to be a go.CrunchGear obtained what appears to be an AT&T or Apple promotional flier showing off the industrial design and features of the iPhone 2 that spotlights its front-facing camera for video phone calls over 3G networks, and video conferencing with iChat users over WiFi where available.
Subtle Changes to Industrial Design. The front of the new iPhone looks virtually identical, but the back has changed, using a matte black back with shiny silver Apple, as well as a (Product) RED model that swaps in a red back to fight AIDS. The tapering evokes the industrial design of the MacBook Air and might offer clues to the look of the rumored new MacBooks, as well. Still no flash on the camera, either.
iChat for Windows. To really push video chat on iPhone, it looks like Apple will roll out iChat for Windows. I repeat: iChat for Windows will soon be available.
3G Networking, 5 MP camera, GPS.Engadget reports that a source got a copy of the firmware for the device, which discloses the actual silicon that the iPhone 2 runs on. We’re talking about quad-band GSM with tri-band UMTS, which basically means that the new iPhone can run at blazing speeds in virtually every market in the world (except lots of the United States, of course). The chip powering it is confirmed to be Infineon’s S-GOLD3H, which has support for up to 7.2 Mbps networking, 5 megapixel camera support and mobile TV access. I would still be shocked to see mobile TV, of course. The firmware also includes hooks for GPS connectivity, so that looks likely, too.
Quite a flurry of activity. Only Steve will prove or disprove the accuracy of these reports.
Image via Uberreview
WWDC is nearly upon us. San Francisco’s Moscone West is plastered with Apple logos. Rumors are in the air. Unannounced products are just out of reach. Rather than try to calm the fervor, I’m just going to pour some gas onto the blaze with the help of my friend Zoltar, The Fortune Telling Machine. It’s that time again — Cult of Mac’s Top 5 Unlikely WWDC wishes! Four of them are credible rumors, the other’s a crazy rumor that I started. See if you can tell the difference!
5. New MacBooks With the rest of Apple’s product line moving to anodized aluminum cases, having MacBooks in retro-iPod white is looking jankier by the day. It’s high time that Apple revamped its low-end laptops to match the hot design of the current generation iMac. And if Apple wanted to throw a real graphics card and a higher-resolution screen into the mix, that would be nice, too. Likelihood (out of five): Three. The MacBook has gotten a processor boost as recently as February, but this is a sorely needed shot in the arm for the product line, and Apple likely needs a Mac announcement in addition to whatever happens in the iPhone and iPod universe.
Following up on the posts by Leander and Leigh about the various iPhone rumors floating around, I thought I’d add a little perspective from the other side of the pond.
The subsidization rumor isn’t one I’m entirely convinced by (given Apple’s track record), but it is something Brits in general expect when it comes to new phone hardware, which might explain Apple having a change of heart.
When the iPhone finally arrived in the UK, somewhat late, Apple got the market wrong, inflicting an American model on the Brits. In this wee island, we’re not used to paying for hardware when on a monthly contract. Typically, if you’re paying £35 per month, you get a decent phone for free (or very little) and a decent number of minutes and texts; alternatively, you grab a pay-as-you-go card and pay full-whack for your phone.
Apple’s cunning plan was to go for all of the expensive options—a relatively high monthly charge and full-price hardware, along with a frankly insulting number of texts and minutes when compared to other local plans of the same cost. This pretty much explains why the iPhone borderline bombed initially in the UK.
The dreadful sales picked up some when the number of texts and minutes increased, but until Brits see iPhones on sale for £150 or less, they’re not going to go for it in any number, especially if there’s a (minimum) £35 per month contract attached. And the same goes for a lot of other European countries.
It wouldn’t entirely surprise me to see a subsidized iPhone in Europe, but the older system remain in place in the US. Frankly, it’d be about time we got something out of Apple after its many years of having fun with exchange rates and charging way over the odds for its goods in Europe.
It’s WWDC time, only this year something is different. Where’s the wild speculation? If patent applications are any evidence, there are many cool things brewing in Apple’s lab —but all is quiet. Where’s the hype that precedes any Stevenote? Oh sure people are talking, but only about one thing: iPhone v.2.0.
Personally, I think this whole 3G iPhone business is a red herring. Sure, it’ll be announced, and people will love it. But the leaks abound so much. I find myself hoping that it’s part of a disinformation campaign; to keep us distracted so we don’t guess to closely at what new cool products Apple might unveil, and that there will be a terrific surprise for all of us at WWDC.
It’s been nearly a year and a half since the “Jesus-Phone” was announced at last year’s Macworld and since then it’s been: all iPhone, all the time, everywhere. I don’t want to seem to hate on the device; the defense will even go so far as to stipulate, your honor, that the iPhone might be best thing that’s ever been invented. But c’mon! Eighteen months after Prometheus descended from the heavens, I’m pretty sure folks were like: “Uh… yeah… fire… great…”
There is definitely more to talk about. There have been some great things come out of Cupertino this year, heck, there is a MacBook Pro that you can literallygive the finger to, and it will respond accordingly. Yet it’s relegated to a footnote in technological history.
Now virtually everyone, including those villagers recently discovered in the Amazon, who have had no previous contact with the modern world, knows that the new iPhone 3G is coming out at WWDC this year. Yet, Steve rarely (if ever) uses the “Just one more thing…” part of the Stevenote to unveil a simple product update especially one so obvious (I know that a 3G iPhone, with GPS, and built in margarita machine is probably considered by some to be more than an update).
So what do you think? Other than a iPhone update, what else do you think Steve will unveil in his Stevenote? I know what I’m hoping for, but like the time I got up the nerve to ask out Sarah Andrews in 10th grade, I’m also steeled for disappointment.
UPDATE: RE: the comments below. I Photoshopped the image above for illustrative purposes. It’s not a spy shot. Also, my tipster said the iPhone will be subsidized, but he didn’t specify whether the subsidy will come from Apple, AT&T, overseas carriers, or all of the above. I can only guess that Apple will sell the iPhone 2 at a loss — to customers and carriers — and recoup the cost from monthly subscriber charges.
I just got a hot tip from a programmer at a major software publisher who claims to have seen the specs for the iPhone 2. This is unconfirmed, but according to the tipster, the iPhone 2 will be announced by Steve Jobs at Apple’s WWDC on June 9, and will much offer more for much less — and be thinner to boot. The iPhone 2 will have:
3G
GPS
2 x memory (16GB and 32GB)
22 percent thinner
Better battery life
The tipster says Apple will subsidize the iPhone’s price to better compete with RIM’s Blackberry. The London Times is reporting the same thing — that the iPhone will cost about $200 in the UK when it goes on sale in July.
The maestro of mockups Isamu Sanada is at it again. Here’s his fab mockup of the second-generation iPhone. Note the forward-facing camera for videoconferencing.
Blogger Jon Accarrino of Methodshop reports that lines are already forming in NYC for iPhone 2.0, which is rumored to be launched on June 9 (the first day of Apple’s WWDC and Steve Jobs’ opening speech).
Jon went by Apple’s 5th Avenue store this morning and found a line of about 50 people all waiting for iPhones — or so retail staffers told him.
Jon thinks the liner-uppers are already waiting up for the new iPhone.
Noting that many in line are Asian, Jon speculates they are from NYC’s Chinatown, and are being paid to wait in line. But I find it hard to believe that people are willing to pay a line-sitter for two weeks or more — especially when there’s no indication there will shortages, which prompted the lines first time around.
Reading between the lines of Jon’s report, I’ll bet they are being paid to snap up dwindling supplies of iPhone 1.0 to be sent overseas. As long as Apple places restrictions on the number of iPhones people can buy (currently 5) and there are not yet official channels, there’ll be demand for grey market iPhones.
Picture: The president of Ukraine, Viktor Yushenko, yakking on his iPhone. The iPhone is hot in the Slavic country. FromiPhone Code.
Used iPhones are worth more than $1,000 in Ukraine, according to the Craigslist buyer who just purchased my slightly scratched iPhone for (get this) $350.
The buyer, named Claude, is heading to Ukraine next week on business and everyone he meets will ask him for an iPhone, he says. He’s sold dozens of iPhones, new and used: It doesn’t really matter.
In fact, I sold him two iPhones: a virgin 16-Gbyte model still sealed in its box, and my slightly worn day-to-day iPhone, an original 8-Gbyte model.
I got $850 for both phones — $500 for the new one (it retails for $500 + $40 tax) and $350 for the used iPhone (it sells new for $400 + $34 tax. I paid $600 minus a $100 rebate).
I felt pretty good until Claude told me he’ll be getting at least $1,000 for the used iPhone in Ukraine, and more for the new one. WTF! — thanks for telling me!
Still, it’s not all gravy. Claude says he has to keep the iPhones on his person when passing through customs, or they disappear from his luggage. Likewise the chargers, cords and everything else. Plus, he has to bribe every official he meets.
Claude wasn’t aware there’s a new iPhone model expected next month (which is why I’m selling). Not that it mattered. He says he’ll take all and any iPhones I can send his way.
The lines are 30-people deep for an iPhone in NYC, Gizmodo reports. And that’s for the current generation iPhone — not version 2.0 excepted in a month.
It seems there’s lots of people desperate to get their hands on unopened iPhones — even a couple of weeks before older models are outdated.
A couple of months ago I bought a 16-Gbyte iPhone at the Apple Store, thinking I’d upgrade from my original 8-Gbyte iPhone. But then rumors of the iPhone 2.0 started catching fire, so I didn’t open it. With the release of a 3G iPhone looking likely in early June, I thought it better to wait.
Trouble is, I waited too long to return the unopened iPhone to the Apple Store, which has a two-week return policy. So earlier this week, I put it on Craigslist for $550 ($50 over retail) and crossed my fingers.
Boy, was I surprised. I’ve had several offers, many of them for the inflated price. Most of these buyers asked me if I had more than one phone.
The first offer came in just a few seconds after I posted the ad. The buyer, who I’m meeting this afternoon, wrote: “I will need as many as you have. no receipt needed if you know what I mean.”
The iPhone must be headed overseas. Apple has a policy limiting sales to five iPhones per customer — checked against their credit card.
I’ll be asking the buyer some questions this afternoon about his interest in buying multiple, unopened iPhones.
Take this with a grain of salt, but Fortune’s Scott Moritz has filed a report claiming that AT&T will subsidize the price of the hotly awaited 3G iPhone down to start at $199 with a two-year agreement, which would be a clear sign that the company is serious about starting to move some massive numbers of the device when it drops in June.
There are definitely parts of the story that I don’t buy — I don’t think Apple is going to go 8 and 16 gig on the new iPhone, let alone “8-gigabit-memory and 16-gigabit-memory,” and the pricing strategy only makes sense if the iPhone is non-exclusive to AT&T. If Apple’s selling the 3G iPhone unlocked at Apple Stores for $200 more, this makes sense. If not, this is just bizarre.
Thoughts? I really hope we see a 32-gigabyte model of the 3G iPhone – that makes it not just a nano replacement for me, but an actual iPod replacement.
While I’m sticking to my original guess that we won’t see a new version of the iPhone until June to coincide with the final release of the 2.0 firmware and enterprise support, everyone’s starting to agitate for a 3G iPhone sooner rather than later. First it was Kevin Rose, and, continuing the cycle, a credulous analyst has entered the fray.
Gartner’s Ken Dulaney, citing foreign sources, says 10 million 3G iPhones have been ordered by Apple for delivery in the near future. He cites European demand for greater data speed as driving Apple’s decision.
Then again, he also says the next iPhone will have an OLED screen which…ain’t happening, not in this life. We should be in for a couple of fun months, though.
Technology analysts are always on the cutting edge of the news out of Silicon Valley. Why, just last night, Gartner Research realized that Apple had licensed Exchange Active Sync, making the iPhone a great option for smart phone users. And they only noticed two weeks after it was announced!
I kid, of course, The report praising the iPhone’s readiness for business customers puts Apple firmly on a competitive plane with Blackberry, Windows Mobile, and S60 phones. Less than a year after its launch as a multimedia device, the iPhone is poised to really take charge in the smart phone space. That’s a big deal, and the endorsement from Gartner does mean a lot to some people making IT support decisions in big companies.
Apple has never had real success in corporate sales, so I can’t wait to see how the iPhone does once it’s ready for its close-up. This note is a sign that it has a fair shot at success.
Though the Financial Times is without question a vastly more reliable source than most places that spawn rumors of Apple’s impending moves, I just can’t convince myself to buy into reports that Apple wants to create a monthly iTunes subscription plan or all-you-can eat music business model with the purchase of an iPod or iPhone. It isn’t their style
While denials from Steve Jobs are usually a good way to spot what he’s working on, this is an area where he has remained steadfast. He believes that people want to own their music, and I believe that he’s right. Sure, I love to sample music as much as anyone else, but the songs that I keep are really personal to me. Renting music just doesn’t work out. Even if Nokia is doing it, too.
Moreover, the monthly subscription business model is one that Apple hasn’t ever offered before to anyone. Not for movies, TV, or software. In fact, Apple’s only experience of recurring payments are with the iPhone’s service fees, which the company gets just a small slice of. There are far too many accounting headaches to resolve to make it worthwhile, and the record companies are angry at Apple. At Apple’s restaurant, they dine ala carte.
Even though it was announced a month ago that “American Idol” had made the iPhone its official phone, and we all know that “Idol” is the most crassly commercial TV show in the history of the galaxy, I don’t think anyone was prepared for the abomination that aired midway through last night’s episode.
After “returning” from an ad break, host Ryan Seacrest reached into the audience to pull an iPhone from the hands of a female “audience member.” He then used the iPhone to visit the “Idol” website, text in a vote for a contestant, and show how easy it is to use the WiFi iTunes Store to download content “directly to your device.” I threw up in my mouth during the segment – A LOT.
I don’t know, can association with Ryan Seacrest make the iPhone less appealing? It’ll take a little while for the taint to wash away, so far as I’m concerned. I’ll post the clip if and when it turns up…
Int13, a prominent mobile games developer, has released a video showing its racing game, “Crazy Kart 2,” running on the iPhone. I hadn’t seen the title before, but I’m pretty impressed by the demo. Nice environments and graphics, wacky gameplay highly reminiscent of “Mario Kart,” but, you know, touch-controlled steering wheel! I can’t wait to see the state of the iPhone gaming platform a year from today…
