iPhone, Apple's Empty Hype Machine
The hype is in full swing over Apple's iPhone, with media and investors alike buying into it as the messiah of gadgets. But does iPhone really compare to Blackberry? Nasdaq shook yesterday with competitors falling, while Apple's stock surged by 8.3% - proving investors are a fickle lot.
After Job's announcement of iPhone, Apple's stock took a $7.10 jump to $92.57. Meanwhile RIM stock took an $11.16 skid to $131. Even Motorola, Nokia and Palm took a small hit. But is Apple's first entry into the mobile phone market a true competitor to the Blackberry Pearl?
It's easy to see why people get excited about a story like Apple's Chief Exec Steve Jobs demonstrating iPhone. It's an intriguing story about a sexy femme fatale of a gadget (iPhone) threatening to assassinate an established master of its domain (Blackberry). Heck, if that were a movie trailer, starring Milla Jovovich toting dual Glock 18s wearing tight leather, I'd put it in on my must rent list when it came to DVD. But make no mistake, the story is fiction. In the real world Milla Jovovich probably doesn't know what to do with high-powered weapons and despite my best efforts doesn't even know I exist… but back to the iPhone.
Sure it's sexy with its wide position sensing touch-screen. Yes, it can do push email too, lending some real brains to its beauty. But it's an esoteric entertainment machine that costs between $499 and $599. Haven't we learned anything from the mobile phone market? People don't care how much senses-numbing technology you pack into a cell phone. The mainstream is looking for lowest common denominator value. The real financial backer of Smartphone technology is not the individual Cingular subscriber, but business. Not very many businesses are going to decide employees need a high priced entertainment machine to stay connected to the office, especially a first generation effort like iPhone. iPhone is essentially a Smartphone with a few messaging features. Let's not get carried away! Nobody is going to toss their Blackberry onto the street while switching to iPhone.
Soon the markets will settle down. We'll all catch our breath. By mid '07 we'll see that market penetration of iPhone pales in comparison to that of RIM's upcoming projects currently codenamed Indigo and Crimson.