iPhone: iThink Not

If you were kicking around Europe in the middle ages there were certain things, William Manchester tells us, that you simply believed. Saber toothed hirsute humans patrolled the forests, Atlantis was just over the horizon, and rabid frothing men with the heads of dogs lived to the south. That there was no evidence of the existence of any of these things would not, the average peasant would sincerely aver, have the slightest impact on the implicit unshakable belief in their reality. The Apple iPhone is a little like the legends of yore. There is no actual evidence of such a beast but because there are iPods and cell phones it seems like a sure thing that Apple will produce a cell phone.

How convinced are people that the iPhone is coming?
Well, there hasn’t been a moment in recent memory when the Apple iPhone hasn’t been rumored to be just around the corner and the rumors are picking up momentum yet again. Of course, that is all they are, rumors and speculation, the equivalent of some peon in 12th century noting that there are both men and wolves and extrapolating that there must be, somewhere, men with the heads of wolves. Which sounds cooler: all the advantages of opposable thumb topped off with the benefits of a savage maw or a phone that works as flawlessly and as simply as an iPod?*

To avoid being overly dismissive it must be noted that there are solid reasons Apple would be interested in the cell phone market. Apple has sold, thus far, 50 million iPods since the .mp3 player was released in 2002. An impressive number, but nothing compared to the 229 million cell phones sold in the first quarter of 2006. Apple likes the green, pines for larger markets and has more than a little expertise when it comes to marrying slick industrial design with easy to use software so the iPhone seems like a natural fit for Apple’s strengths.

Couple Apple’s natural ability to crank out a better than average cell with the prediction of a market visionary…well really rich guy…Bill Gates. Mr. Gates is certain that the demise of the iPod will be assured with the rise of a do it all phone. Bill’s reasoning is as follows: Why, oh why would users lug two pieces of techno gadgetry around when only one circuit laden hunk of plastic is necessary?

With these two key pieces of info in mind, we can now boldly proclaim that either an Apple cell phone is coming or the iPod will soon be in an ever accelerating death spiral. As Lee Corso would ever so annoyingly put it, not so fast my friend. For all the good reasons why Apple can’t afford not to cram a phone in an iPod there are even better reasons why they won’t do it anytime soon.

The most telling reason is that people don’t really want an iPod phone. At this point, it would be all too easy to point to the Motorola ROKR or the failure, several years ago, of cell phones with built in FM radios and chalk the absence of an iPhone to the decidedly tepid reaction to similar devices by consumers. Others would counter that Apple could easily address all the issues that made the dual purpose phones a failure. In regard to design and software, they are right, Apple could come up with something great. In regard to what people actually want, they are likely a bit mistaken.

While there are no shortage of issues to work around with the fabled iPhone one of the toughest issues Apple would have to overcome would be battery life limitation. An iPod nano runs for 14 hours after being recharged and a Motorola RAZR will let you gab to your hearts content as long as heart is fully sated in under 7 hours. Listen to your iPod and you lose talk time, and talk time is what people want out of a cell phone. Short of a return to the brick style phones of the late eighties a trade off between talk time and music listening is not what most users seem to want after all, you can make it through the day without your iPod but many can’t make 5 minutes without their cell phone.

Apple’s other major problem is the dysfunctional US cell phone market. For readers abroad: the US cell phone market works, in general, as follows: commit to two years of service and get a free cell phone.

On one level, people instinctively know that they are paying for the phone but, since they don’t get a discount for using their old phone, they sign up and take the free electronics. Sure, it would be better if people bought the phone and paid for the service separately but that is not the model the providers have chosen to foist on the American public. With that realization, the understanding that Apple would be at the mercy of cell service providers is unavoidable.

The notion of Apple selling a product and relying on another major company to provide support and, more importantly, reap continued profits of said device is laughable. If anyone is going to make money on Apple hardware, it is going to be Apple. The usual method offered around this intractable dilemma is an Apple branded value added phone network. A network where Apple would lease time from a cell phone company and resell the time to subscribers. It is hard to see that as an appealing option, all the network problems of the provider will still be there and it hard to see Apple offering a phone at below cost just to lure in subscribers.

When all the factors are taken into consideration what once seemed like a foregone conclusion seems much more chancy. One begins to wonder if the speculation is arising out of personal yearning by the analysts for Apple to take care of their cell phone woes. Of course non of this means that Apple won’t devise some non traditional solution and take a nascent marker by storm, but just expecting Apple to crank out a cell phone simply because they can is a bit of a stretch. If the “just because” credo was part of Apple’s corporate identity we would have seen an Apple tablet long ago. Don’t expect to see an Apple cell phone until Apple can think of way to make it great and, more importantly, very, very profitable.

*For the record: wolf head guy wins by a mile.