Monday, June 04, 2007

[snip]Although a launch day is still pending, the iPhone is still slated for a June release[/snip] *The iPhone is due June 29 (, so I'd better lay out my predictions before they come to pass.

1. Many will be sold without phone service. I am convinced AT&T is not subsidizing the price. It just doesn't suit Apple to let the carrier control it. That being the case, a lot of people will buy one before their existing contract expires and switch later. Without phone, it's still a widescreen iPod and wifi-powered Internet device. A lot of people want that now and won't mind adding phone service later.

*Also, look at the new ads ( They open with the non-phone features and close with a phone call. They're selling it as an iPod first and a phone second. That strategy makes no sense if it cannot be bought without phone service, and unlike Microsoft, Apple has an established track record of marketing their products based on their strengths.

2. The dock connector will be the killer app. Yeah, the iphone won't be open to third-party software until they work out all the bugs (and since Apple has no phone experience, there will be bugs). However, third-party hardware exists now, including systems that could expand an iPhone into a laptop or desktop. Plus, USB charging and seamless sync with Outlook through the dock are very attractive features.

3. Quick and easy firmware updating is another underappreciated edge. Again, Apple is new to phones. They will need to hammer out the bugs, and that means firmware updates, which are quick and easy to do through iTunes. BTW, as I stated a while back (, this inexperience is a big reason for them to start off with one carrier. They'll have enough trouble making the iphone work smoothly with one network. No point in compounding that difficulty with multiple networks with unique quirks..

4. iPod sales will be noticeably cannibilizeds. What Apple's not publicizing and analysts aren't recognizing is the iPhone will be many people's new or next iPod. This means sales of regular iPods will decline. This won't hurt Apple since the iPhone generates more revenue, but it will make their prediction of selling ten million units seem far less grandiose.

That's it for specific predictions. In general, I think the iPhone will at least approach Apple's sales target, if not surpass it, though this will come at the cost of iPod sales, and many buyers will not immediately sign up for phone service (I'll say one-third). Some will interpret this as failure, but I think they've been planning it this way all along. It'll be interesting to see how it turns out in a year.

CateGoogles: mobile_tech
Mood = curious


My iPhone predictions


  1. This was suppose to go here:


    If the iPhone is offered as a standalone device, do you think the price will be $499? Or will it be jacked up due to the no phone contract?

    Also will this have any kind of text editing, or simple note taking, since it is a touch screen?

    It would be nice to write lists.

    By Anonymous Anonymous, at 6/04/2007 12:56:00 PM

  2. Yeah, I responded there too..

    Anyway, I do think the price will be fixed at $499/599, regardless of phone contract. I state this more often than I should: Apple makes money selling hardware. They don't care about selling phone service. Their only interest in it is to sell iPhones.

    At the same time, I'm sure Apple is bound by contract to push the two-year service, but where's the incentive in making that a hard limit? Once a buyer has an iPhone in their hands, their only choice to get phone service on it is AT&T. Whether they sign up immediately or wait until their current contract ends, an iPhone owner who wants to use it as a phone will be using the AT&T network. It is very similar to the iPod+iTunes arrangement, and we know how well that worked.

    Also, I should have specified this, my prediction is about how Apple will sell the iPhone; I doubt AT&T will sell it without phone service.

    As for text editing, I don't see why not. It has an on-screen keyboard for email, text messaging and web surfing, and the iPod can sync and store text files. Worst case scenario: note-taking can be done via email to yourself.

    By Blogger Sumocat, at 6/04/2007 01:15:00 PM

  3. Ha! posted an article asking the question: Will the iPhone Cannibalize iPod Sales? Tim Deal, a senior analyst with Pike & Fischer, thinks not, but does not commit to that prediction, nor does Avi Greengart of Current Analysis. C'mon people, that's like saying the iPhone will sell well, but it might not. Very non-committal.

    By Blogger Sumocat, at 6/06/2007 10:37:00 AM

Post a Comment

<< Home