iPhone Success
What makes a Phone Cool?
Looking at the iPhone phenomenon with Million of those devices sold, I could not help getting curious about some of the key reasons behind its runaway success.
A big fan of gadgets, I have owned Nokia E Series and Blackberries as well. I had resisted the iPhone for a long time sensing that this might just be a fad some 2 years ago. When they launched, it did not even run on 3G and came with a flashless 2MP camera. I needed something with more features. A longer list of hardware specifications and thought not much of the iPhone at the time.
Let’s fast forward to about 4 weeks ago. Went out for dinner on a Friday with a friend and he was no doubt a convert of the iPhone who insisted on me playing with this precious device/toy. I was surely quite drunk at the time but was equally impressed anyhow with the range of applications that it offered. Played a few games looked at how the iPhone could make some cool recommendations for our next beverage and so on.”
Once I sobered up, I spend the entire week end over some 12 hours looking up the iPhone site, checking out the imminent release of the iPhone 3GS and realizing why I must now get the iPhone 3GS! It came down to applications. Software created for the iPhone by a loyal, growing band of iPhone software developers globally. I am told some 15,000 applications from suggest a cocktail program” by shaking the phone” to Google Maps that seems to a run a lot more seamlessly and effortlessly than the Nokia Maps or even Google Maps on Nokia’s N95, 8 Gig or Blackberry Bold.
Obsessed with the technical specifications of pure hardware, I had been oblivious about what makes a phone really cool … software . In this case more choices than I could possibly run out of. Compare the 15,000 applications for the iPhone against that of a Windows 6 operated phone or even an Android Google Phone and there is no contest. Furthermore, looking at Windows Mobile 6 for a simple Media Coversion Software at USD 25 versus some of the more expensive applications on the iTunes Stores at top USD 10, then you get the picture.
These days, we all live increasingly busy lives and not many of us can afford to sit down at our chunky laptops or skinny netbooks to draft a blog, Twitter an inspirational comment or respond to an email. How about a 5 minute wait at the taxi stand or the bus stop or whenever you have a 5 minute break – waiting for someone or something. In my life these days those 5 minutes here and there represent a rare and welcome haven, an oasis where I can catch a quick and refreshing youtube.com clip about my areas of interest.
Other as I have observed increasingly here in HK and even Singapore where I work in, folks listen to music, play games, surf the web and yes sometimes make phone calls too. The portable, communications and online computing, entertainment device known as your Smartphone, PDA phone or in this case the iPhone is the answer to all of my needs and that of so many people around me. It is seamless and simple in some cases. Boot time is in seconds rather than minutes for my Windows powered Dell or my HP laptops. The Mobile device is always on and always ready for a fun and practical experience. I can use it anywhere and do almost anything it seems. The video editing software on the iPhone seems to be simpler than my Canon Zoom Browser X. I may not need Movie Maker to edit the undesired bits from my video clips and what I can do in transit or on vacation using my Mobile device is enough.
Let’s take a few steps back and find out how did all of this come into play to enable iPhone’s success. Earlier in this blog of mine, I referred to the legions of IPhone “Phanatics” users, developers coming together on a common platform, an elegant piece of hardware with a big enough touch screen, to watch Videos, do mails, surf the web and make calls too. We need here to credit Steve Jobs with the Business Acumen that in my mind commands the utmost respect. Yes I don’t give out compliments lightly and not to anyone. The thought process and execution of Steve Jobs in making the iPhone made it all possible.
Make a piece of hardware that is cool to use, got that! The real secret if there was such a thing was to offer Developers revenue share for coming up with Apple sanctioned software that people wanted. From a cost of development, R&D, creativity into making thousands of software programs or iPhone applications available, Apple could have hired hundreds of the best engineers and software programmers on a hefty payroll to create iPhone applications that could be another runaway success or total failure and waste of precious development as well as R&D funds. Steve Jobs may have asked himself a simple question like … “how can I create cool funky applications to make our lives more enjoyable, fun, productive, profitable without using apple’s own internal resources?”
He might also have wondered how to make the cost of those iPhone applications cheap as chips. Affordable enough that a teenager on a newspaper run pocket money could in theory afford to buy software. The iPhone user base was growing leveraging off the success of the evolving generations of iPods preceding the iPhone. We know that much. There were lots of Apple converts to kick start the process of a phone that was not only intuitive, easy to use and a fashion accessory as much as it was cool to be seen with one but also cool software as well.
Enough people to buy the iPhone, enough developers on a revenue share scheme to keep creating more cool applications and more people who convert to the iPhone based on the user friendliness and applications. This business model became self sustaining and took a life of its own. iPhone applications start from 0.99 cents. Buy it on the phone itself or via iTunes which also doubles as an efficient multimedia organizer and shopping portal interface for your Digital needs. The payment side of the equation is also sorted. This means using the 1 Click buy as I understand it, is fast, safe and does not require me to constantly input my Credit Card details … especially if I had a few bottles of Sake or wine.
Taking a Look at the Competition
Looking at Google Android I can see Google making a serious attempt at one day dethroning the mighty iPhone. Via partnership with HTC they create Google Branded Phone and create opportunities as I imagine for Developers to then create applications for perhaps share of advertising revenue. Mobile advertising I imagine. The business model is one I don’t really have a clear insight on as it would be in theory not so compelling for Developers to share in Advertising Dollars Google earns as it is for them to get a simple share of a sale as with iTunes applications for iPhone for instance.
Without the financial incentives on one side of the equation driving supply of cool mobile apps, then with some initial demands by consumers for what is perceived to be a “cheaper” iPhone equivalent, it might take some while before the Google Phones really go Viral. With its thirds incarnation now know as the Google “Magic” phone, I have yet seen any cool mobile applications. In fact Google claims hundreds of Apps and yet when I “Google” or search for fun, practical apps I cannot find much if any. To reach the kind of critical mass iPhone achieved as we pointed out earlier, 5 things must happen.
1. A cool piece of hardware with an integrated software/application solution
2. Plenty of folks willing to shell out a lot of money – early adopters like myself as well as fashion conscious folks and techies as well. In iPhone’s case, it is all of the above and then some.
3. An organically, rapid growing legion of developers who are willing to create applications for the phone itself.
4. A simple multimedia manager with integrated store, eCommerce capabilities dull of enterainign products that can be downloaded either for free of at a small cost and in a totally secure digital environment.
5. And when all of the basic elements come together, you have critical mass and a self sustainable model or organism that has a life of its own.
The jury is indeed out as to whom can really compete with this model – we all know how capable Google can be. Their business model is based on the very foundation of the early days of the internet where “stuff” was available for free. We have surely evolved from those early days. And yet there is something compelling for a lot of folks who could be swayed into the “Free software” value proposition if Google takes the same root as it does with all its other applications. I will be blogging about the evolving Google business model soon, so stay tuned.
Cheers
Dan
