The iPhone Ecosystem

Now that some of us have woken up after a full day of product lust drunkenness (very understandable)—Bruce Nussbaum makes some excellent points asking if the iPhone is an "ecosystem" or an ultra cool, innovative product.  The observations are based off of the business reality of how the telecom business functions in the US, among other things.

From the post:

"OK, by now most of us have product lust for the new Apple iPhone and many folks will buy it but the real impact of the iPhone will be in its transformative power to create--finally--a unified ecosystem among the cell phone carriers that delivers a great experience to people. Just like MP3 players before the iPod, the cell phone market is fractured among different carriers who thrive on delivering their own bad service. This is why innovation in cell phones has shifted to Asia and Europe.

The cell phone experience in Korea and Japan, and much of China, is simply superior to that in the US thanks to the dastardly deeds of the carriers.The iPhone is perhaps the best shot at changing all that and bringing innovation back to the US. But that will happen only if Steve Jobs can pull off in telephony what he's pulled off in music. He needs to go beyond just one carrier, Cingular, to bring Verizon and others into a partnership. The iPhone is a cool product. But it can be revolutionary if it becomes a cool ecosystem."

Can Apple pull it off?  Will the iPhone repeat the success of the iPod in the MP3 player arena or does it even need to?  What about fragmented carrier considerations, such as not all carriers supporting the same technologies?  I think Bruce makes a good distinction between "cool product" and "revolutionary product".  The iPod changed the face of how we enjoy music.  The iPhone seems to at first glance posses the same potential—if it can overcome some key barriers.

Note: the visual included some input from Bruce Nussbaum

Oh, and this just in from the WSJ (and Roger von Oech)--Cisco has sued Apple for trademark infringement over the iPhone name.  Well, like I said, it's more of a "digital lifestyle accessory" than it is a phone, so maybe Apple should just change the name. ;)

Comments

[Aldana]

iPhone site crashes my Firefox really bad... what's up with that?!

[Gavin Heaton]

Got to love Cisco ... don't know if I would "go and get an iLife" ... I haven't got enough time for my first and haven't graduated to Second ...

Anybody got a couple of tin cans and a some string?

[Graham Hill]

David

Before we all get carried away in a drunken, emotional frenzy of Applemania, perhaps we should take a sober, logical look at the iPhone's chances in the US market, and ultimately in the world market.

Rather than repeat what others have said, take a look at what Tomi Ahonen (an expert in the truest sense on all things mobile telephony and mobile marketing) wote at his Communities Dominate Brands blog.

Handicapping the Race: iPhone Markets and Rivals
http://communities-dominate.blogs.com/brands/2007/01/handicapping_th.html

Open Letter to Apple: The Killer App is Not Voice or Music
http://communities-dominate.blogs.com/brands/2007/01/open_letter_to_.html

Perhaps Apple is going to need all of your support if it is going to achieve its somewhat optimistic sales figures.

Graham Hill

[John Young]

With all due respect to Graham (Graham, it's nothing personal, and I may well turn out to be wrong, of course), YOU ARE TOTALLY WRONG :) Here's why:

For years, technology developers in the States have had to shelve their plans for blue-sky mobile ventures. I can't count the number of brainstorming meetings that I've had to throw cold water on, even though I would have LOVED to build that killer app. Now, the iPhone, with it's occasionally-connected wifi running (some flavor of) OS X, opens the market way way waaay up. And with the brand awareness, clients will be willing to open their pocketbooks to pilot on the iPhone (in a way they wouldn't be willing to pilot on a niche Nextel device, for example.)

I'm gonna throw caution to the winds -- I don't think we're excited ENOUGH about "the Jesus phone" yet. Read a lot of the sci-fi that's been coming out in the past few years written by Digital Generation authors (cf. Cory Doctorow), and you'll see a strong vision for a personal computer that is very similar to the iPhone. Hell, once we have bluetooth 3.0 and can drive a 240x240-pixel display in your sunglasses, we'll all be sitting in the Piazza San Marco shouting "SELL IT!" like in the IBM commercial. That's now one step away, not three steps away.

I know everyone is saying "but will people buy it?" and the answer is 100% of the PEOPLE WHO ARE ME will TOTALLY buy it, and will start developing for it immediately because there's, like, four years' worth of awesome ideas we've been waiting to deploy.

PS: SMS? Good point, but I reiterate: chording keyboard. You heard it here first :) Remember, raw capabilities are just a part of the puzzle -- there were many MP3 players on the market when the iPod came out. The feeding frenzy you're seeing is the evidence that this is a category-changer.

[DA]

John,

I think you are throwing caution to the wind and are not looking at this from a business perspective. Take a look at the link that Graham points us to. It's makes some good points.

Will the iPhone be a "category changer"? It's possible, and maybe it's the closest thing to it we've seen. Only time will tell.

Yes, thousands (millions?) of people like you may buy and develop for it. Will that be enough?

Also remember that the iPod really took off when it started offering different versions that matched people's lifestyles. Maybe the iPhone will follow suit.

[Jamey Shiels]

Very interesting discussion. To complicate matters, it looks like LG is already moving in this direction with a similarly styled phone.

http://www.engadget.com/2007/01/11/iphone-and-lg-ke850-separated-at-birth/

The stats from Graham's post are very interesting and show an uphill battle for Apple to get to 10 million. Especially if LG and others get rolling.

I also think you'll see a higher than usual number of "early adopters" for the Iphone because of it's cool factor. Another question is, in a smartphone power user market, can apple provide the connectivity and programs that business users live on.

[John Young]

DA, I'm *definitely* throwing caution to the winds. With malice aforethought, too. It's about damn time we threw caution to the winds in the mobile space in the USA. Because with a passionate user base, things Just Happen. So there's no question I'm going with my gut, here. And I'm totally aware that I could be wrong. But I (and many other mobile developers) have been taking the "oh, let's wait and seeee..." approach for so long, we're good and ready to throw all our weight behind this platform. It's the Second Coming of the Newton, man.

Now, WHO'S WITH ME? Yaaaaaargh!
/charges hill

PS. I don't think this is going to have big initial uptake with business users, by the way. It's going to be the Digital Generation youngbies that will forego three pairs of shoes and a whole week of drinking in order to have it.

[John Young]

Oh Steve, you done me wrong. Now Jobs is saying that there will be no third-party apps on the phone, which means that developers are falling out of love. Representative sample from Slashdot:
http://apple.slashdot.org/comments.pl?sid=216502&cid=17570202

Sigh :)

[Lewis Green]

David,

Excuse me if I don't get the iPhone. Admittedly, I'm an old fart but, I have to ask: Do I need all that noise and distraction when I am away from the office?

My answer: Nope. Instead, I'll pop into Starbucks with my cell phone, which I use to make telephone calls only. I prefer the coffee and real human, face-to-face interaction.

[DA]

Lewis, it won't be for everyone. A big difference between the iPhone and iPod.

[Ike]

I prefer renaming it the "Digital Lifestyle Extender."

Somehow, "iDLE" has a ring to it.

[Matt Dickman]

Do you think that AT&T's move to change Cingular's name will effect people negatively? I think Cingular's brand is much more youthful and individualistic than AT&T and that may hurt them a little.

[Ann Handley]

This is a great discussion here, guys. And John Young -- why am I channeling Braveheart with your Call to Charge?

DA -- I think you hit on something with your suggestion that the iPod took off when Apple started versioning it to fit certain lifestyles/pockets. I gotta believe that's what they have in mind again. And if they don't.... well, they're crazy.

Ike: "Digital Lifestyle Extender"? Does that come ribbed?

: )

[steve goldhaber]

Just wanted to throw something out here... I don't think apple needs to win by stealing share of other smart phone devices. Think about it this way.... If I'm in the market for a new ipod and I'm willing to pay around $200-$300 for it, why not integrate a phone with a bunch of bells and whistles on it as well? Apple will win by converting a group of loyal customers who start saying... "well... why not get the new cool ipod and a phone as well...It's just makes sense to integrate it into one device." In our complex world, simplicity and integration go a long long way and I bet customers are willing to shell out a little more money to get both. (If the iphone actually does this... keep in mind we will not know until the phone hits the streets and start hearing real user feedback)

[Roger Smith]

iPhone is available with Cingular ONLY!? And what if I am stuck under contract with a carrier OTHER than Cingular but still want a iPhone?
Well, the only solution I could fine was http://www.Cellswapper.com - they get you out of any cell phone contract!

[Sez Chapman]

Cingular is terrible anyway! Why would I choose this, and why is it my only choice?