Ann Arbor Area Business Monthly
Small Business and the Internet

iPhoning Home

July 2007

By Mike Gould

As I write this, Steve Jobs has just announced the June 29th availability of the iPhone, Apple's hotly-anticipated first foray into the smartphone arena. As a result, the entire Internet is atwitter with punditry, and since this is the Communications Issue (see my article elsewhere in BizMo), I thought I might as well share the buzz with you. If nothing else, the iPhone has "Communications" written all over its gorgeous touch-sensitive screen.

What all this breathless hoopla is about is whether Apple can make the same breakthrough into the mobile phone realm as they made in the music player market with the iPod. The initial announcement from Jobs was made several months ago, much against the usual Jobsian dictum that new products be announced the day of their availability. This time, since telephones involve a host of other partnerships and government agencies, Apple figured the cat would be out of the bag soon anyway, and went with an early announcement.

What it is The iPhone is a darling little doodad that combines the functionality of a mobile phone with a calendar, camera, photo display device, web browser appliance and widescreen iPod. This sounds like a Ronco sort of device: "It slices, it dices, it surfs the Web". Packed into a package roughly the size of half of a deck of cards (4.5 x 2.4 x .46 inches) is a 3.5in. LCD screen, a four or eight gig flash memory card (depending on which model you buy), a measly 2MPx camera, and a wireless rig that talks to WiFi, BlueTooth, and ATT telephony - quad-band GSM at four different frequencies and EDGE networking, for you techies out there. (I have no idea what that means).

The ads for this are stunning, and visible at the URL below. To control this you touch virtual buttons, move photos back and forth with the stroke of a finger, and type Instant Messages into a virtual keypad. The only physical control is a Home button that teleports you instantly to your front door when pushed. (I'm kidding. I think...). The whole shebang runs under OS X, so Mac fanboys are drooling at the thought of hacking into it for even more features.

What's not to like? Well, the price, for starters. $500 bucks and up for the unit, plus whatever ATT decides to charge you (which could be a serious monthly fee if you sign up for all the services this jobbie can tap into). Some sources on the Web peg this all more than $1500 for the first year for purchase and fees. Plus you have to sign up for a two-year contract with a phone service which is, um, unpopular for a variety of reasons.

There is also the matter of the touch pad keyboard - no buttons, no tactile feedback when a key is pushed, small virtual keys which may baffle large fingers (as existing smartphones do, granted), and a whole new way of sending instant messages to master.

Something that sticks in the craw of software developers is that there is no Software Developers Kit (SDK) for this. Apple has reserved the right to make all the applications that will run on this itself; others need not apply. This is bad because a developers community is just what a new platform needs to really take off. And OS X or no, this is a new platform. Apple threw developers a bone in that they can make Web 2.0 applications that will run under the Safari browser on the iPhone, but this is not the same as a real live icon-on-the-desktop application created with an SDK. Jobs later said that Apple hopes to open the platform in the years to come.

Why this matters to a small business person: with an open platform, a developer could design an application that would, for instance, allow you do your inventory with your telephone, tapping into your company's server and entering data as you walk the warehouse, tapping on the screen of your iPhone.

So What? The financial concerns will probably all blow over. Remember that this is not a phone, it's a smartphone, and smartphones (the Treos, BlackJacks, and other devices of the world) are expensive. The original iPods were the most expensive music players on the planet when they came out, and they've done pretty well. Estimates are that the price will fall at around 20% a year, and second-generation iPhones are reputed to be on order at various factories in Asia.

Research firm Goldman Sachs says the iPhone will likely succeed. Microsoft's Steve Balmer says it will fail (big surprise there). There is speculation running rampant about this all over the web. A Google search on "iPhone" reveals around 62 million pages devoted to Apple's new device.

Print media is also getting their oars in - this, from Businessweek:

"Beyond the hysteria surrounding its June 29 launch, the iPhone has the potential for adding a totally new, $10 billion-a-year business within just a few years. If Apple can expand so-called smartphones from a luxury carried by corporate road warriors into an everyday tool for the masses - combining the functions of a BlackBerry and an iPod - Apple could soon see a new growth tear."

So When Am I Going to Get One? Ah, geez, I dunno. Not right away, that's for sure. Way out of my price range (although if BizMo wants to buy me one, I'd be happy to write an even more in-depth review, hint, hint). As un-thrilled as I am with the performance and cost of my current Verizon cellular phone, I have read enough bad things about ATT to make me leery of switching over. Not to mention the hassle that will be, what with arranging to keep my existing phone number , etc.. And I try to avoid Rev 1 of anything.

But it sure looks like one dandy device, and I'll probably end up with one some fine day.

Apple marketing hype here:

Mike Gould, is a part-time mouse wrangler for the U of M, runs the MondoDyne Web Works/Macintosh Consulting/Digital Photography mega-mall, is a member of, and welcomes comments addressed to

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