Sunday, June 24, 2007

Whistling past the cell phone graveyard

I expect iPhone 1.0 to induce massive gnashing of teeth among the foolish early adopters. Apple has the creativity gene, not the quality gene. If I buy one, it won't be before November -- and I can't buy one ever if there isn't a reasonably reliable solution for bidirectional synchronization of tasks, contacts, and calendars with Outlook (via .Mac or gCal would be ok - I expect Google will give us this even if Apple won't).

On the other hand, I think the cell phone industry will never be the same again after June 29th. The current crop of cell phones are, for geeks like me, a travesty. The closest thing to acceptable is the senescent and absurdly expensive Treo, now being placed on life support. So it's interesting to watch the reactions of industry insiders:
AT&T Hoping the iPhone Has Coattails - New York Times

...Mr. Lanman said Verizon already had at least 18 music-capable phones. In the next few weeks, he said, it plans to introduce a new model of its Chocolate phones that allows not just downloading of songs over the air but also transferring music from computers.

Mr. Lanman said he was not worried that AT&T would steal customers because Verizon’s network infrastructure is superior and offers better connection coverage and stability. “For Apple, I think the big risk is the AT&T network.”...

... .Edward Snyder, an equity analyst with Charter Equity Research, said that many people would be turned off by the price; older customers who can afford it, he said, will not care about all the fancy features of the iPhone, while younger ones who are excited about the device will not like the cost.

Over all, Mr. Snyder said, the iPhone will appeal to maybe 3 percent to 5 percent of wireless phone users. And he said he was skeptical that it would work as well as advertised.

“Implementing a cellphone is absolutely more difficult than anything Apple’s done to date,” he said, noting that, in particular, the phones might have trouble delivering consistently good voice communications and that the devices could suffer overall reliability problems. “Go out and buy an iPod and hold it at waist level and drop it. That’s the end of the iPod.”

“I don’t think Apple’s going to be a big player in this at all.”...

... Bill Plummer, vice president of Nokia’s multimedia group in North America, disagreed with the assertion that the iPhone would bring fundamental change to the market. He said Nokia already sold high-end phones with a wide range of functions, including the N95, which has a five-megapixel camera and a hard drive to store and play music. The phone works on either the AT&T or T-Mobile network and sells for $749.

The iPhone, he argued “is an evolution of the status quo.”...

Mr. Lanman's comments are probably the smartest. He's clearly concerned but careful about what he says -- but he's omitting the DRM problem. Downloaded music to Chocolate phones will all be DRMd; I wonder how well CD ripping works for the Chocolates, and whether they can plan non-DRMd AAC. If they can't then Verizon is pretty dumb. (AAC is not an Apple technology; neither of the "A"s stand for "Apple".)

Mr. Snyder wasn't doing too badly until he got to the part about dropping an iPod. You can drop a Nano from a rooftop and it will keep working - even if the case cracks. He's confusing a hard drive iPod with a flash iPod. I'll give him a little credit because the iPhone looks extremely fragile (titanium clamshell is more my style), but he botched this one.

Mr. Plummer's claim that the iPhone is "an evolution of the status quo" is hilarious.

In case we didn't know it already, the iPhone is clearly terrifying the cellular industry. If it does nothing else, it's already a modest success.

Update 6/26/07: Daring Fireball has a more entertaining summary of these interviews.

No comments: