iPhone = iRrelevant

by Chris Kenton on January 11, 2007

SorcererI was hoping to make it over to Moscone today to breathe a little of whatever is in the air at MacWorld. In the past few days, I’ve had numerous people tell me with great excitement how great the new iPhone is. I’ve heard people referring to Steve Jobs as a marketing god. I’ve watched the Apple, Inc. stock jump, just as it does almost every January when Jobs throws back the curtain on the latest revolution. Give me some of that kool-aid, because I’m not seeing all the bright colors today.

To be sure, Jobs is certainly a genius. He’s hit more out-the-park home runs in marketing, in more arenas, driving more revenue, than almost anyone. But he also has a fair share of duds, which is only natural, but which everyone seems to forget in January. The latest, before the iPhone, was the MacMini, which was supposed to drive a revolution in small desktop machines.

I still remember back in, what was it, 1999, when the 5-color iMacs were unveiled. I remember seeing the great creative ads, and thinking, what?, the great revolution here is colored computers? And then it hit me like a ton of bricks how mind-numbingly brilliant that was. Yes. Color, style in computing. We all had clunky beige boxes with no pinache, and Jobs made computers cool. And the iPod. Jobs took those clunky MP3 players with no memory and turned them into a simple, powerful and cool device for bringing more music into your day. Phenomenal.

But what does the iPhone bring to mobile phones? Everything the iPhone does, I can already do on my Treo. Sure, the UI looks streamlined and the package is pure Apple sex, but the mobile phone industry isn’t exactly lacking in revolutionary spark–a hot new design from Motorola, Samsung or Nokia comes out, what, every Tuesday? The iPhone won’t even be available until June.

Everyone on the planet with an ounce of interest in this space has been waiting for Apple to merge the iPod with a phone for generations (product, not human) so this wasn’t exactly unexpected. And yet everyone gasped when the iPhone was unveiled. That is Jobs’ true genius. But if Apple was really on its game, they would have had the iPhone ready to ship today. In six months time, it may prove to be the next MacMini instead of the next iPod.

{ 11 comments… read them below or add one }

Nathan Gilliatt January 11, 2007 at 10:40 am

Did you catch the explanation for announcing it in advance of its availability? Phones need FCC approval, which is a public process. Apple had to announce it before starting the approval process if they wanted to be the first to announce it.

Chris Kenton January 11, 2007 at 11:18 am

Maybe, but I’ve seen a lot of speculation about why they pre-announced by 6-months, and that’s only one of the competing theories. What is clear is that 9 months ago they were talking about “major technical hurdles”, and those few souls who have gotten their hands on the iPhone have noted missing bits and pieces. http://bits.blogs.nytimes.com/2007/01/09/some-hands-on-time-with-the-iphone/
Certainly not as bad as a balsa-wood Newton, but really, where’s the revolution here? I’m happy to be wrong, as I was with the color iMacs… what am I missing?

Nathan Gilliatt January 11, 2007 at 12:13 pm

Fashion, perhaps? The iPod doesn’t really do anything the other MP3 players don’t do, either. It seems to me that the iPhone (or whatever they end up calling it) does two things: It combines several devices in a neatly integrated way, and it delivers it in a very good-looking package. Assuming they get all the bits to work, Apple demonstrates that great industrial design is worth the investment. The revolution isn’t necessarily strictly technical.

That big screen (compared to Treos and the rest) doesn’t hurt, either.

Chris Kenton January 11, 2007 at 1:39 pm

Yeah, but that was my point. Unlike it’s past successes, Apple is now entering an arena where design, both in the fashion and in the interface senses, is already hot currency, and there are many segments being served today–from the hot pink razors to the SUV Blackberrys. Granted, Apple has its own design language and plenty of brand loyalty to drive interest, but I don’t see the same sweeteners you had with either the iMac or the iPod–especially at a proposed price point of $499, when people are used to getting their phones on the cheap. From what I hear, Apple expects to sell 10 million iPhones in 2008. That’s equivalent to the number of iPods they sold from their debut in 01 until the end of 05. That’s big ambition for such a crowded space–and if anyone could pull it off, I suppose it would be Apple. But, I’m not convinced. Compared to their previous successes with equal amounts of steak and sizzle, this seems like a lot more sizzle than steak.

David Raab January 14, 2007 at 11:01 am

The real opportunity is having a screen and user interface that are convenient for more substantial tasks than the current smart phone/Blackberry/Treo. This opens up all kinds of possibilities because it combines the always-on and location-aware attributes of a mobile phone with the flexibility of a portable computer. I wrote about this at http://customerexperiencematrix.blogspot.com/2006/12/why-smartphones-matter.html in more detail. But I can’t tell from press reports how open the iPhone will be to externally-developed applications. Keeping it closed (an Apple tradition) would sharply limit its value.

jens January 18, 2007 at 7:31 am

hi chris.
i doubt that the apple phone will be the next iPod. the iPod was a masterpiece – a strike of genius that does not happen too often. just like the original mac-concept the phone is build on apple’s ability to improve usability – in other words: to bring tec to people that hate it – or: to make digital devices usable in an analog world. – the same goes for the iPod – only that the apple music player could also capitalize on a huge infrastructure: the world of digitalized music with its different (sharing platforms). since vinyl records had been replaced by CDs there had not been a convincingly pleasing aesthetical experience to deal with something as sad as pixeled music. – the ipod came as THE convincing solution. (i do not think that the mobile phone market looks anything like this – and i just as well think that nobody really expects this)

you are mentioning apple’s unsuccessful product launches and i think it is totally right to bring them to the equation. – and the equation goes: you never never never never ever know – still you have to do your very best! – so forget most conventional market research wisdom. – ship (with a big bang) then test!!
(it did not harm apple’s reputation, did it?)

lots of contemporary product strategy can be summed up in three factors: develop products with passion, introduce them with entrepreneurial guts and always have a portfolio diverse enough not to risk your whole substance in one field.

corporations in our new century need two key abilities: whole-hearted product development and gutsy investing.
everything else is yesterday’s story. everything that puts the clarity of this approach at risk has lost its place in business.

it looks like it is a whole new game.

Chris Kenton January 18, 2007 at 8:58 am

Jens–

Very, very good comment. Spot on. I’m not “anti-Apple” by any means, but I do think consumers and especially marketers need to think a lot more critically about marketing campaigns, rather than falling into the collective gasp of amazement any time Apple pulls back the curtain on a new product.

The only part of your comment that left me curious was “It looks like it is a whole new game.” What do you mean?

Thanks,

/chris

jens January 18, 2007 at 11:47 am

thanks, chris.
as i remember you and i have kind of a similar background – both studied marketing – you are definitely more on the metrics side though – we have similar working experience – and also your 1997-post makes me smile quite a bit…
so what do i mean?

let me try:
i think one difference between yesterday and tomorrow is the difference between “product differentiation” and “product development”. product differentiation = economics of scale + styling (surface variations)
product development = entrepreneurial guts + design (as in smart solution that pay respect to a number of constrains) ((+ portfolio strategy))
the former tries to keep the risk outside of the organisation the latter invites risk into the heart of the organization.

in the today’s automotive world this is one big difference between Mercedes and BMW for example.

the way i see it, it is extremely crucial for a corporation how they define ‘marketing’.

the classical concept of “the marketing organization” holds an extremely dangerous blind spot.
because – and you might disagree with me on that – marketing was designed to keep creativity out of the organisation (“somebody has to deal with the idiots in the funny shirts”)
but that clearly was yesterday.

and now, as you invite creativity in you invite risk in. and this has tremendous organizational consequences.

i think we can/will sense a significant gravity shift.


sorry chris, i had to rush my answer a little bit. – but thanks for challenging me.
/

jens January 18, 2007 at 11:51 pm

chris. i am very interested in your opinion on this point.

jens January 19, 2007 at 5:52 am

let me just follow through on that thought.
every discipline, every operation needs a starting point. marketing’s starting point is a given product or a given service or a given corporation or brand.
you take that order, look at the markets, come up with a strategy and make all the styling adjustments and communication campaigns that it might take. and like mickey mouse as the little wizzard you create some magic around it.

what happens now is that everybody seems to find that this is too late in the value chain to bring in the magic. it has to happen before, it has to happen in the product itself.

“what do you mean? – how can i create something when there is nothing i can test?” says the marketer.
“i am not talking to you”, says the ceo.

Chris Kenton January 19, 2007 at 9:42 am

Jens–

Great comments, which should be given more air for dialog. I’ve posted a summary and response as a top-level blog entry: http://scribb.typepad.com/marketonomy/2007/01/differentiation.html.

Thanks!

/chris

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