David's Blog

After digesting all of the stories, videos, blogs and comments on the ‘Net, I make my predictions about the success of the iPhone.

Here we are on the eve of what is arguably the hottest product launch in the history of computing – the Apple iPhone. Over the past few weeks the amount of buzz surrounding it has reached frenzied proportions! As usual, I read the same reports on the ‘Net typical of an Apple product launch – “Apple is great!” “Apple is going to fail!” “Apple did it all wrong!” “It’s too expensive” “I want one!” “No one is going to want one!” “The iPhone doesn’t do <insert favorite technology or feature here>”. So, I’m here to add to the insanity and give my take on the success of the iPhone, but through a different perspective. In short,

Apple is going to sell millions of iPhones … and this is just the beginning.

Why will it be so successful? Apple expertly markets and sells technology catered to the largest section of consumers who are, based on their technology needs and knowledge, simply the average person. Most companies (try) do this, too, but always fail to excite consumers in the way Apple does. Their secret sauce is one thing – the user experience – and it permeates the entire experience, from marketing to packaging to purchasing to product use, etc. It is this user experience which fully resonates with the majority on so many different levels.

!http://davidmccuskey.com/wp-content/uploads/2008/12/chasm-400w.jpg(The Graph of Moolah)!:http://davidmccuskey.com/wp-content/uploads/2008/12/chasm-graffle.png

click on the image for a larger view

The market and the majority of which I speak are best described in the book “Crossing the Chasm” by Geoffrey Moore. Graphically, his view of the market is a typical bell-shaped curve that is split into five different segments of consumers, each with their own technical needs, motivations and comfort levels. The names of these groups are the Innovators, Early Adopters, Early Majority, Late Majority, and the Laggards. By far the two largest of these consumer groups, and the ones to target to be extremely successful, are the Early Majority and the Late Majority. And, it’s interesting to note, it’s not necessary to target these consumers with the best technology[1]!

No, Apple doesn’t always compete using the latest technology, though whatever technology they choose they make it easier to use and more beautiful than any existing product. With the iPhone they have once again upped-the-ante by bringing to market the world’s first consumer multi-touch display which uses hand gestures to navigate the phone’s menus and tools. The screen is gorgeous, the graphics are adorable, and people will have fun using this phone.

It’s apparent that Apple put a lot of research and development into the interface and they will need to recoup their costs. Thus paying a premium for this device shouldn’t be unexpected (though it is actually not that expensive when compared to other smart phones on the market today[2]).
Initially price won’t be an issue because the first purchases will be made from those in the market groups called the Innovators and Early Adopters. These people are willing to spend extra money for something cutting edge, but to be fully entrenched in the latter groups the price must fall to within their budget (as did the prices of the iPod). I expect the first price drop to happen in 6-12 months with the second revision.

Of course there are things which might hamper the iPhone’s success:

• Manufacturing defects
  I think Apple is poised and ready to deal with any issues which come up.

• Usability
  Notably the keyboard and battery life, though I’m sure Apple has done a lot of testing. Initial reports are positive.

• AT&T service
  This isn’t really under Apple’s control, but they have taken over part of the process, notably activation of the phone which will be done through iTunes!

It’s obvious that Apple has worked extremely hard getting the iPhone to market. From outside appearances, the iPhone execution has been superb, especially considering all of the components Apple has brought together within a few short years.
The early summer release will give Apple time to work out the initial bugs and give the market opportunity to see how cool the iPhone really is. Fast forward six months and Apple will once again be selling the most desired technical gadgets during the Christmas season.

Given the new touch interface, the iPhone is the most revolutionary mobile phone / Internet device / music player the world has ever seen. Apple will sell millions, make billions, and fully deserves to do so!

fn1. Two notable examples are the Apple iPod music player and the Nintendo Wii game console. Neither product incorporates the best technology on the market, but they are both one of the most desired items in their respective categories. The popularity derives from their user experience.

fn2. Check ebay for the Nokia N95. (At the time of this writing, the Nokia 95 was selling for ~650$US)