Could the iPhone become a flop?

by Dan

iphone3.jpgThe development of the iPhone took more than 2 years, and during all the time a legion of Apple fans dreamed about the mythic device that was suppose to redefine the rules of the mobile communications industry.

January 9th and Apple finally unveils its long-waited mobile phone. The press and the stock markets acclaimed the announcement while consumers all over the world shuddered by the thought of possessing one.

So far so good. But what if the iPhone turns out to be a flop? What if Apple’s strategy reveals to be wrong and the iPhone sales do not live up to the expectations? The Innovation Zen site has an interesting list titled “10 reasons why the iPhone might flop”. Below you will find the first 3 items on the list:

1. The mobile phone market is not the digital music one: Apple did something unbelievable with the iPod, redefining a whole industry (the digital music one) and placing its MP3 players in hands of more than 70 million people. No wonder they are so confident about exporting the iPod success into new segments. When Apple entered the digital music segment in 2001, however, there were no dominant players and the segment was relatively immature. Most of the people purchasing an iPod had no prior experience with MP3 players, meaning that Apple only had to convince them about buying the product (and not about ditching an existing one). The mobile phone industry represents quite a different situation, where virtually every single person already has a phone, sometimes with complex subscriber plans on the background.

2. Competition will be fierce: do you remember Diamond Multimedia or Sensory Science? Probably not, but those were the companies producing the first MP3 players, and they were also the competition Apple faced when it decided to enter the digital music industry. The iPhone, on the other hand, will face competition from the likes of Nokia, Motorola and Samsung. Those players do not only have deep pockets, but they are also among the most innovative and design-oriented companies in the world.

3. Apple’s user experience will be affected by Cingular’s user experience: analyze Apple’s history and you will see that its success was always derived from the ability to integrate hardware, software and services. Such integration enabled Apple to create an incredible user experience, like in the Mac-iPod-iTunes combo. The iPhone, however, will enter the market through Cingular, meaning that the service part of the equation will no longer be under Apple’s control. This will reduce Apple’s flexibility and it will also force customers to interact with Cingular, which is not as hassle-free as using an iPod, you can bet.

You can read the complete list here.

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