Om Malik has a great post up digesting today’s news that Nokia is going all in on Symbian Limited, saying there’s three players now in mobile phones — and Google ain’t one of them.
Noting that today anyone can make mobile phones using off-the-shelf components and factories in Asia, Malik argues the future of mobile computing and communications will focus almost entirely on design, user experience and software. He likens the mobile phone business to the PC business – which Microsoft dominates with its Windows platform – and says the winners in the handset market will depend a lot on the software developers creating apps for mobile platforms.
According to Malik, “In this platform game, the winner is going to be the one that can attract the most developers,” and the problem, for Nokia and some of the Symbian Fondation’s other members (among them, Motorola, NTT DoCoMo, AT&T, LG Electronics, Samsung Electronics, STMicroelectronics, Texas Instruments and Vodafone) is they are backing a confusing array of platforms, including Linux.
Apple has long been a poster child for the wisdom of Adam Smith’s Invisible Hand. With active trade in some of its discontinued products, such as the iSight camera (which regularly sells on auction sites such as eBay for more than the original purchase price), and high-resale values for “previously owned” and “refurbished” models of its computers, the reality has been that the cost of owning an Apple over the years has not been nearly so high as its reputation for premium pricing might indicate.
The iPhone is providing additional confirmation that, despite complaints about the company’s obsessive desire to control the user experience, they must be doing something right at 1 Infinite Loop.
iPhone Atlas reported recently on the high prices still being fetched at resale by the original model phones, indicating concern over the ability to unlock and/or jailbreak the upcoming model, combined with significant demand in countries where the iPhone 3G will not initially be on sale, including Russia and China.
While the current value of first-generation iPhones may be high, with reports of the bid on 16GB phones near $600, some believe the market for the phones will stay active with prices coming down as the availability of 3G models gets closer. Michael Johnston at iPhone Alley suggests the window for high prices may be closing soon and Dennis Sellers writes for Macsimum News that active trade in the post-3G launch market for first-gen iPhones could see prices come down under $100.
With Apple and AT&T seeming to have foiled the unlocking/jailbreaking movement that flourished in the wake of iPhone’s initial release, Stateside customers who must have the speed and features of the 3G model but still have, or want, service with a carrier other than AT&T, will either have to wait and see if the new models can be jailboken or look to Apple’s deals with a different carrier in almost every country overseas, where the phones will go on sale next month. Across both ponds Apple has had to agree to a wide range of prices and options for selling the iPhone 3G, making it likely that in quite a few countries outside of the U.S., you’ll be able to buy an iPhone without a contractual agreement.
In the blizzard of numbers being tossed around concerning the much-anticipated debut of iPhone 3G, the most significant one could be the price of the phone itself. As Pacific Crest consumer electronics analyst Andy Hargreaves notes, sales of both Apple’s iPod and Sony’s PS2 gamestation saw exponential gains in the wake of being offered below $200.
Aidan Malley reports for AppleInsider on the explosive growth anticipated for new phone sales in the coming year. “The relationship [between price and sales] is shockingly consistent,” Hargreaves says. “At average prices above $200, Apple never sold more than [6 million] units in a rolling four-quarter period. At prices below $200, Apple never sold fewer than [8 million].”
Should Apple fulfill even industry analysts’ most modest sales expectations, savvy decision-making in the company’s sourcing and supply-chain business units could translate into much higher margins on the 3G models than those seen with the original iPhone, all of which adds up to very good news for Apple investors and shareholders.
Confident now that it’s got a winning product, Apple is set to release the iPhone 3G simultaneously in 22 countries on July 11. And unlike the limited distribution model in the US, where consumers may only purchase phones from the company or from AT&T, overseas customers will be able to find the new phone in plenty of places.
Apple Insider reports that Deutch Telekom, T-Mobile’s German parent signed a first deal which will let Gravis sell iPhones attached to a T-Mobile service plan, allowing customers there to pick up a phone without visiting a T-Mobile retail outlet.
Dutch and Italian consumers will also have a variety of outlets to choose from, according to an item in Macworld. The high-street-availability distribution model appears to derive from the success Apple and UK carrier O2 had in bringing Carphone Warehouse on board to maximize availability of the product.
The newer, faster iPhone 3G, set for release on July 11, promises to chart new frontiers in mobile pornography, according to Time magazine.
The $13 billion adult entertainment industry sees the new Apple phone as a key in the shift from physical distribution (IE. DVDs) to a business model based on downloaded and streaming smut.
The iPhone is “by far the porn-friendliest phone” on the market, says Devan Cypher, spokesman for San Francisco-based porn producer Sin City Entertainment.
The porn industry may have problems with Apple, however. An Apple spokeswoman told Time it does not condone porn on the iPhone and promises to ban adult content from applications being built by third party developers for distribution by the company’s AppStore.
Following on the heels of competitor BMW’s optional iPod dock, Steve Jobs’ preferred German automaker Mercedes Benz announced a custom cradle for the iPhone available as an option on nine classes of its vehicles. The interface will allow seamless integration between the iPhone’s music and telephone functions and the vehicle’s systems, Mercedes says.
Placed in the Mercedes’ onboard cradle, the iPhone’s music and phone functions can be controlled with the help of multifunction steering wheel controls, while the vehicle’s display indicates phone status, music functions, etc. The cradle features automatic recharging as well as increased reception with the help of the vehicle’s antenna.
AT&T may be subsidizing up to $425 of the cost of each new iPhone it activates for service when the 2.0 3G models launch next month, Barron’s reports.
According to Oppenheimer analyst Yair Reiner, AT&T will cover an additional $125 premium over the carrier’s typical $200 smartphone subsidy because the company thinks the iPhone will increase subscribers and average revenue per user. Apple will receive an additional $100 bounty for every new AT&T customer who signs for service at an Apple Store.
The early book on the new phone is very bullish, with Reiner calling for 15 million units to be sold in 2008 and another 33 million in 2009.
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.
