This article was originally written and published by me on Fast Company in 2008, and is now republished here.
Apple just launched its mobile phone in Asia. I won’t extensively comment on the technicality of the phone, neither will I comment on its look. I am sure that – like most Apple products – we will all agree that the iPhone looks good and will surely be very user-friendly.
However, is a phone the next big innovation that will bring Apple to the next level of true consumer goods manufacturer and that will cement the company as Wall Street’s darling?
Since Apple recently dropped the word “Computer” from its name, we can assume the company sees Consumer Electronics as the next route to sustained organic growth. The global iPod sales are still healthy with 2006 sales up 35% from 2005, but a plateau is looming down the road. Apple needed a “new iPod”, we got the… iPhone.
Why the iPhone is not really such an innovative product:
- Most key features available on the iPhone are already on the market: MP3 player, camera, video, conference calls, emails, web browser. The camera boasts a 2MB picture capacity – this was already available two years ago. Most high-end phones now offer 4MB++. To be truly innovative, the phone should have been VoIP-ready with Skype or G-Talk.
- The operating system is not open source, which means hoards of free programmers and fans will not be able to build free plug-ins and find new ways to use the iPhone a la Mozilla. Let the users deliver innovation and correct bugs!
- The design is very déjà vu. Though thicker, most O2 phones have a similar look, and so does the LG KE850. The Multi-Touch interface will delight fans of the usually easy-to-use Apple interface and will annoy clumsy users with big fingers (like me) and/or clean-screen freaks. To protect the usually fragile Apple screens, a sliding cover/keyboard should have been provided. I am not a ‘metrosexual’ and would prefer to sacrifice good looks over usability.
- The iPhone memory capacity is still limited to 4GB, 8GB, 16GB compared to what it could offer. It feels like Apple is using leftover flash memories from its iPod stock. To be truly innovative and disruptive, the iPhone should have been equipped with 20GB+, somewhere in between the “small” and “large” iPods.
- The new iPhone 2 is now 3G. Great… here is something new!
- Not for the office. Can’t type email messages like on a Blackberry (well, at least not at the same speed!), and to make matters worse, the iPhone lacks data encryption. The iPhone will not make its way to most boardrooms soon.
- No third-party software and applications – the iPhone comes as is. This means Skype and G-Talk cannot be self-installed. The likely scenario is an iTunes-like platform where owners will have to pay a small fee to download and install third-party software.
- Even the name is not new and not innovative. iPhone? Why not iTelephone, iCall, iThis and iThat? iPod is a great and innovative name, but iPhone sounds really too obvious. On top of that, it has been “borrowed” from Cisco, which had also launched a few months before Apple a set of phones named… iPhone!
Frankly, there is little innovation in the iPhone. If any, it is incremental at best and surely not very disruptive. It is truly beautiful, but it is not disruptive per se. It will not send tremors in the mobile phone world. Apple’s commercial magic remains centered on borrowing existing technologies, magnifying them, packaging them into stylish design, and creating best-of-the-class marketing buzz. That’s all. It has worked in the past very successfully. It may work again.
So will the iPhone be successful in Asia?
Steve Jobs promised to sell 10 million units in 2008. This is probably a conservative number as 6 million units have been sold so far. The iPhone will sell well. No other consumer electronics manufacturer has reached the same level of ‘Brand Coolness’ as Apple. Many have tried and… are still trying. The iPhone will be a status icon, just like the iPod.
However, Asia is not Europe and the US. Consumers are a lot more tech-driven and early adopters than their western counterparts. Apple brings to Asia something “cool” but nothing really new – nor something that hasn’t already been available in Asia for a while. Apple can forget about submerging Japan and Korea with its phone. These markets remain quasi-locked to outsiders. India and China may be the biggest mobile markets in the world, but few will want to pay USD 200–300 for a phone. That leaves Apple to focus on smaller markets like Hong Kong, Taiwan, Singapore, and Australia to boost global sales.
Will the same iPod predator-free environment apply to Apple’s iPhone? This is not likely – especially not in Asia where Samsung has reached its very own new cool status. Apple has switched from a relative Blue Ocean Strategy to a deep dive into a shark-infested ocean. Walking into well-armed Nokia and Samsung territory may not be Apple’s best move.
Damien Duhamel
Managing Director Asia Pacific
Source: https://www.fastcompany.com/978736/there-market-i-phone-asia
