iPhone: Miracle or Disaster?
Steve Jobs held a keynote and announced the iPhone. One site even did a quick look and feel of the phone. Apple surged by 8% and others like Nokia and RIMM dropped. Though RIMM dropped more than Nokia.
What I think: Sell Apple at its peak (it should climb a bit more) and buy on the weakness of the other players.
The remaining part of this blog will explain why I am skeptical of the iPhone. Some may view this as being overly critical, but others will wonder. You will wonder who is right me or Steve Jobs. Since Steve is much richer and has built a big company (unlike myself) you will be biased towards Steve.
I am critical, and I think what happened with the iPhone is Silicon Valley blinders! I am also skeptical when an analyst gushes like the following comment.
Tim Bajarin, principal analyst with Creative Strategies, said the iPhone appears poised to revolutionize the way cell phones are designed and sold.
“This goes beyond smart phones and should be given its own category called `brilliant’ phones,” he said.
Oh give me a freaken break! These are the same analysts and people who in late 2000 said that the Segway would revolutionize how we would move about in cities. What impact has the Segway had? Zip, nada, zero! In fact Holland recently banned them.
So let’s say the iPhone is revolutionary, why distribute only on the Cingular network?
The phones, which will operate exclusively on AT&T Inc.’s Cingular Wireless network, will start shipping in June. The 4-gigabyte model will cost $499, while an 8-gigabyte iPhone will be $599.
I am going to be smug. America is a wonderful nation that has many innovative and creative products. But if you want to storm the world with your new design in cellphone technologies, then launching solely in the US is a REALLY BAD idea!
What this does is give the other cellphone makers who happen to be mostly non-American corporations (Nokia, RIM, Samsung, Sony-Ericsson, and Motorola) ammo to see where the iPhone succeeds and fails.
Even if iPhone succeeds in the US, the others will have plenty of time to squash the iPhone in the rest of world.
Steve thinks his iPhone is designed perfectly. Ok I could buy that, but I am skeptical about the ergonomics. Ergonomics plays a much more important role with cellphones and I think the iPhone is missing ergonomics.
“Keyboard: The softkey, on screen buttons are small. Think index finger, not thumb. Maybe I wasn’t doing it right. The keys pop up when I put my finger down on the keys, but do you think the proximity sensor knows when I get close (but before I touch), and if I hover with my digit, it’ll blow up the keys so they’re easier to hit? (Am I making sense?)”
Steve in his keynote thought that the keyboard in its current incarnation was dumb and limited. Yet Steve in his quest for design is missing an ergonomic issue, a cellphone is a single hand device.
In all of the keynote pictures and the mentioned comment people talked about using the phone with two hands and a finger. Bad idea! From the pictures I have seen there does not even seem to be side buttons. Side buttons are useful so that you can do single hand operations, with the RIM thumb wheel being the classic example.
This is the reason why the stylus failed with smartphones. People are used to thumbing with their cellphones and that is not going to change.
The following comment shows that the iPhone is putting the cart in front of the horse.
“Now I want to show you somethign incredible, I want to show you Safari running on a mobile device. I’m going to load in the NYT, rather than just give you the WAP version, we’re showing you the WHOLE NYT web site. I can put this into landscape mode and there it is, I can scroll up and down here…”
I have an Origami device and let me tell you I struggle to read HTML pages. The iPhone is not going to make this any simpler. The problem is not the screen or the DPI, but the content providers. The content providers create content for devices that have 1024×768 screen resolution. The HTML pages are littered with advertisements and thus loading the content on smaller screens is down right painful.
The idea behind WAP was to force content providers to make slimmed down readable content. Obviously WAP failed.
IPhone is less than a half-inch thin — slimmer than almost every other phone on the market. It comes with a built-in, 2-megapixel digital camera, as well as a slot for headphones and a SIM card.
Slimness is not the issue, overall size is the issue. I like to stick my cellphone in my pocket. If I can’t do that, I don’t always carry my phone. Many other people think like this, and it is absolutely critical with women. I am not trying to be sexist, but my wife who is a manager buys the smallest phone available. Often her suits have no pockets, and if they do she does not want the phone bulging out of her pocket.
Many seem to love the screen and I am not going to naysay the screen, but my cell phone has been dropped, sat on, crunched, scratched, etc. Very often I have had to replace the casing because I managed to crack it. This iPhone is screaming to be cracked and scratched.
This slimness could be a double whammy in that people will stick the phone in their pocket. Then as they sit, or move around the phone goes snap. If this does happen I would drop Apple stock like rock!
Moving from the design to the technology. The idea that the phone will do everything is a bad idea. Consider the Nokia N Series. The entire series is focused on specific topics like film, video, music, look, etc. Look at the newly introduced N800, which is their second generation Internet tablet. The idea is that you have specialized devices that connect to each other using wireless technologies like Bluetooth.
I have a Nokia 6131 which has a built-in camera and 2 GB MP3 player. It is small enough to fit into my pocket alongside my keys. If I step into my car my phone connects to my TomTom GPS. The TomTom is a hands free device and lets me receive or make calls.
When I need to drive a longer route after having entered the route TomTom will automatically use the Internet capabilities of my phone to download the latest weather and traffic conditions. If traffic jams are ahead then I will be rerouted.
Having reached my destination when I open my laptop my phone and laptop connect to give me broadband speeds.
The point is that the best GPS device is a dedicated GPS device, or the best notebook is a dedicated notebook. Devices that try to be everything to everybody have weaknesses!
If I read it correctly I am even questioning the technology used in the phone.
“iPhone is a quad-band GSM + EDGE phone.” No 3G! “We have WiFi and Bluetooth 2.0″
Ok Steve are you saying that if I want 3G I need to get a phone and hook the iPhone to the 3G phone? I will admit that 3G is not a big issue, but if I am going to buy a phone that needs to last for the next 3-4 years it better have 3G and all of the latest cell phone standards (eg 3G or MaxWiFi).
Summarizing, I find this phone would attract those that buy brand name devices so that they have the device. This will get Apple some marketshare, but I am skeptical that they can keep the marketshare.
Additionally as witnessed at the CES this week vendors are making an assault of the iPod market. Apple does not have the monies nor the leverage to battle multiple fronts like other corporations. This is why I am skeptical about Apple and will at the peak (probably in the next couple of months) buy year end PUT options.
Disclaimer: You can loose money if you were to follow my advice so always always be skeptical about what I say!
Hello There Mr Roboto!
(the song and era says it all... http://www.devspace.com)
9 Comments Add your ownSubscribe
1. Christian Gross | January 10th, 2007 at 6:56 am
Second day fallback: It seems that people are in two camps, love it or WTF. There are those that want it right now, and there are those that are complaining.
http://www.digg.com/apple/Gizmodo_iPhone_Hands_On_I_Called_My_Mommy
Here is a comment from Digg I really liked:
http://www.digg.com/users/TheOverman
If Apple gets a good marketshare with only this device I’ll be really surprised at how much people can be controlled by marketing. I still believe in human nature and brains so I’m holding my breath.
This time, Apple calling this device anything “revolutionary” is a really stretch. Calling it evolutionary is arguable. I’m waiting to take a deep look at the interface to see if there’s something really new that can be salvaged from the iPhone. The demo videos I saw online (graphical eye candies aside) show an interface that is a simplistic (meaning with less features) version of latest Windows Mobile devices.
Form factor? Well, the whole “oh, look, no buttons, so the interface is dynamic” that Jobs was BS’ing about is the way the WM devices with touch screen have been forever. As a matter of fact, in the first generation Windows Mobile they did the same mistake Apple is doing now, removing keys altogether and leaving the user with a clean, touch screen interface. The response from customers? A resounding “hell no! I can’t type on this”. That’s why most of new generation Windows Mobile devices have the sleek sliding keyboard along with the touch screen and with automatic screen re-orientation (no news here either). Want a really powerful and well thought touch screen phone? Try this one:
http://www.engadgetmobile.com/2007/01/08/htc-omni-specifications-unearthed/
Dimension is one factor that many list as one of the few points where iPods are better than Zunes, and arguably one of the strenghts of Apple designs. Well, there’s nothing to praise here either. The iPhone is visibly (and on cold numbers) wider and longer than any new generation device (think Q or BlackJack) and a little thicker still. To be honest, even in those slimmer devices, I think that the flat, wide, shape is particularly cumbersome and I tend to like better clamshells and smaller candybar phones
(The new Samsung i760 is sweet! http://www.engadgetmobile.com/2007/01/06/samsung-i760-hands-on/ )
And don’t get me started on the fact that the iPhone is not even supposed to be a real extensible platform ( http://www.engadgetmobile.com/2007/01/09/the-iphone-is-not-a-smartphone/ ) Big, BIG, mistake!! Phones are all about customization, personalization, new games, new apps, etc. That’s how we got to 1 billion phones world wide. And by driving the development community out of the Palm OS the Windows Mobile managed to steal along the market.
The non-replaceable battery is another bummer, no matter how long they think they can go with a single charge, everyone that depends on their cell phone on a daily base knows that you always need two times the juice they have at any moment
If you start listening to songs on this, then, make it 3…
No 3G? That’s SOO 2 years ago!
And no support to Office documents, access to Exchange, etc? WTF???
400 bucks with 2 year contract to Cingular? You gotta be kidding!
What’s really the market for this? It’s not iPod’s teens, because they prefer the PS3 and XBOX for this money. It’s not the professional guys, because the phone is lacking too many of the features they depend on to work. It’s not the casual cell phone user, because that one will buy the cheapest device with the cheapest rate service they can find. Maybe the San Francisco “intellectuals”, but those have brains to figure out hype from reality (I surely hope so).
The reality is that Apple took 2 or 3 years too long to get into the cell phone market. It’s a quite more mature market than mp3 players were by the time iPod was released (Creative and others didn’t really had got a handle on that and penetration was minimal) and has big names that have been innovating for years (Moto RAZR, THAT was quite a revolution. Samsung seems to be releasing new devices every day. And those sexy Nokias…).
I don’t know which cell phone Jobs has, but he’s not speaking for me when he says that “people hate their phones”. I don’t hate mine! I hate my carrier, which happens to be Cingular!
I really think that when the hype is gone the iPhone will leave that kind of impression you get when you think you understood the joke someone was telling but the joke was really on you. But, you know what? I hope not! More choices are always welcome! Maybe they get right the second time!
So, good luck, Apple! Nice try and don’t give up!
2. Jason | January 10th, 2007 at 10:16 am
When the iPod came out, it had 4 things going for it:
(1) Slim Size, (2) Huge HD, (3) Sexy Style, (4) Usable Interface.
What does the iPhone have for it:
(1) Slim Size?, (2) Sexy Style, (3) Music Playing.
If it is slim (haven’t looked at too many pics or touched one yet), there are a lot of other slim phones on the market.
It is cool that it is running OSX, and Apple Geeks will want to pick it up for sure.
And it does seem to be a better music player than any other phone since it integrate with iTunes and doesn’t require some BS like Verizon’s V-Cast.
Good points, Christian. I don’t know if this can take off yet. They are likely to push a bunch of units on brand name alone, but any one issue becoming too big is going to kill the device. People are unforgiving. Although the first iPods seemed to handle some of their issues well: dying, internal batteries, dying hard disks…
3. Christian Gross | January 10th, 2007 at 11:32 am
Jason: Don’t you find it a bit strange that you did not mention the phone capabilities of the i*Phone*?
About being a better music player I rather doubt it. Take a look at the N95 http://www.nokia.com/nseries/index.html or N5300 http://www.nokia.co.uk/A4254051 from Nokia.
I could only find N95 series documentation in German, but here are the stats: http://www.nokia.ch/german/phones/phone_models/n95/
- All bands UMTS, quadband, WLan, etc
- 5 Mega Pixel Camera
- 20x digital zoom
- TV Streaming and DVD video recording capabilities
- Java functionality, organizer, etc, etc
The N95 kicks the butt of the iPhone! The only place where the N95 is not as good is hard disk space, but the N95 has slots.
The reality is that Apple is delusional in thinking that THEY are the only ones who can do phones!
4. Jason | January 10th, 2007 at 11:43 am
That is funny that I didn’t talk about phone features. When I buy a phone, here is my checklist:
(1) Will it call people?
(2) Are the keys big enough for my fat fingers?
(3) Is the phone slim enough to fit in my pocket?
That’s about it. I’m not even up on all the 3G vs. G-spot stuff. SIMM cards or whatever. Maybe I should care about those things.
I tried to do some quick research, but maybe you can answer these questions for the Nokia which I would find important on any audio playing handset:
(1) Is it easy to get music on the device? Can I somehow move MP3s from my computer to the device?
(1.5) Do I have to repurchase music I already have?
(2) Do I have to pay an extra monthly charge for the music?
I bet the answers are correct for the Nokia (Yes, No, and No, respectively). But one thing I do know is that the Nokia will not work with iTunes like the iPhone will. This is huge for old iPod users who have their life of music wrapped up in that software.
BTW, I don’t want to give the impression that I’m a fan of the iPhone or iPod. I’ve had to HD-based iPods break on me and I’m through with that company.
5. Steve | January 10th, 2007 at 12:08 pm
I think Christian has some extremely valid points from a technical standpoint. My thought though is that Apple has succeeded by making products that the average non-techie user can use without a lot of work. OS X is a very simple OS. The iPod is very simple to use. iTunes is very simple to use and they all work together. Someone who has purchased hundreds of songs through iTunes can’t listen to those songs on other players, they have iPods and right now they’re carrying around an iPod AND a phone.
The iPhone’s niche is going to be the working person who has an iPod and a phone and can merge them into one and merge their PDA in as well. Will the iPhone change the world? Not yet. It needs a revision or two and it needs a lower price point first, but then it could.
I always swore I’d never buy an iPod. They’re too expensive! What a pain in the ass! The screen is too small! And what’s next to my right hand as I type this? My video iPod. I’m typing this on my new Macbook Pro as well.
While Apple’s strength may be marketing, the thing you can’t deny is that their products tend to work, work well and work easily and their customer support, as far as I’ve seen so far, is much better than most companies. Don’t underestimate brand loyalty. As the Mac Mini, Macbooks and Macbook Pros and iPods bring consumers into the ‘Apple Den’ they will gain loyalty like no other company and with that loyalty, I think consumers will give Apples products a look when they are in the market for a new device and as Apple lowers prices to where they’re competative with other companies or have a $20-50 premium, their sales will explode.
There are many ‘better’ mp3 players than the iPod, but they get crushed by iPod sales. Can the iPhone do the same? It’s possible when version 2.0 of it comes out at $299.
- Steve
PS - As for the stock, remember that we just jumped almost $10 on the iPhone news, which doesn’t even include the Quarter 4 results news (which should be stellar), OS 10.5 is going to be released in the first half of 2007 and you know Apple, we could very well see a ‘Oh, one more thing…” or two coming soon as well. I think we could see an Apple split in 2007.
Invest in peace…
6. Christian Gross | January 10th, 2007 at 1:07 pm
I had a long response, but decided against it. The response boiled down to the fact that while I used to be an Apple fanboy the last year or so has been very very trying. I am not convinced anymore…
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