Yes. Yes. YES, the iPhone is finally out. Nearly the entire IT industry came to a grinding halt as Steve Jobs announced the iPhone officially. Alongside some of the moust highly receptive praise from the analysts, comes the near certain barrage of doubts. We all know that fame begets criticism, and I’d like to share with you a piece from one of my favorite industry rags and stomping grounds of crazy-man Jim Cramer, The Street
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As much as I’d like to send out a big NYC boo-yah to Kaas, I’ve found several shortcomings in his argument. The vast majority revolves around a very myopic view of the product lifecycle, and it’s phases. Just like enterprise software roll-outs, you cannot expect everything to make the first iteration, not just due to bandwidth limitations, but it’s not practical from a feedback perspective, as you need to hedge your bets and adjust your strategy based on the success of each phase.
High selling price spells limited marketing potential.
An 8GB iPod nano and a high-end handset with similar features to the iPhone would retail for under $300, so the planned pricing implies a 100% premium for device integration and “the coolness of all things Apple.”
First, I’m not sure where he’s getting his numbers. I think “similar features” is a stretch, the size of the Grand Canyon. Industry experts (you know, consumers?) agree that the benefits of usability are priceless. I don’t know of a single phone that is more usable than the iPhone.
Granted, the iPhone is not cheap - for now. Like any product who’s price is governed by evolving hardware, you’re going to see prices fall - quickly. It’s no guess that the highly proprietary (read: low production volume, demand and hence high cost) LCD touch screen is taking the lion share of the handsets cost. Expect this price to halve by next year. This is an old concept, and I won’t waste time repeating it. Just look at the evolution of iPod pricing over the years.
2. Why not target the corporate market?
One word: Blackberry. The last thing Apple needs to do as an emerging entrant in a completely new market, is make it obvious to the current market leader, that its going for it’s throat. I blogged on the business vs. consumer segmentation prospects for the iPhone earlier, and still feel that Apple is not yet poised, or flat out even interested, in the business user sector. Microsoft and the stodgy B2B crowd usually beat Apple to the punch, simply becuase I don’t think Steve Jobs and the rest of the Apple bunch love to serve that market, they love consumers, and each market has a separate set of expectations.
Now, that’s not to say that Apple won’t ever go there. However, I don’t see Apple recreating BlackBerry type functionality. I would love to see them partner with Google Office. Just a wish, here.
More post upcoming on this topic.
Tags: apple, expensive, iphone, mobile, thestreet.com
