BBC NEWS | Technology | Apple iPhone warning proves true

[Peter Korsten]

Andrew Robinson schreef:

> I think it's very telling that the bar's industry insider thinks of 
> phones as a disposable while all the consumers on the list don't, it 
> really shows the disconect between the industry and the market.

Aren't you mixing up Paul and me? My Sharp GX25 is being replaced now, 
because the company thinks that someone in my position (whooo! ;) ) 
should have a phone with wireless push e-mail. It's like, what, two or 
three years old? I don't remember.

It replaced a hand-me-down that needed to be replaced since it was 
broken beyond repair. Before that, I had another hand-me-down, one of 
those Nokias with a black-and-white screen.

As to what our customers do with their phones, I don't know. As a matter 
of fact, I don't know an awful lot about mobile phones.

I do, however, get an insight into where the market is going. At the 
moment it's 'convergence', which means that mobile companies are 
expanding into the fixed market, and offer a mix of mobile, VoIP and 
broadband.

Mind, some two years ago the big players on the mobile market, at least 
in Europe, were focussing on offering a complete media solution on your 
mobile, with ringtones, news, entertainment, MP3s, videos, etc. This 
idea is not totally abandoned, but you see that the focus is no longer 
there. Companies like Apple with the iTunes Music Store have grabbed 
that market.

Which makes the choice of Apple all the more amazing. They're going to 
fish in a market that is either saturated or not interested, and the 
only thing really going for them is that they have iTunes. Great, but 
are they going to create a lot more *new* revenue from that channel? 
Isn't it a shift from people with computers or iPods, who now instead do 
it via their iPhone?

Moreover, their revenue is supposed to come from data services, which 
are always hard to sell. It's hard to sell something to people that they 
don't really need or even want. So then you're looking at high ARPU 
(average revenue per user) customers, but they're a small group. Mobile 
operators are really keen on increasing the use of data services, but 
it's damn difficult.

The only things that the iPhone has going for it is ease of use (in 
which it easily beats any competition) and the name of Apple. Sure, the 
Apple fanboys will all get one, but in the over 500 million potential 
customers in Europe, they're a very small and negligible group.

The main reason why mobile companies want to jump the iPhone bandwagon 
is because they don't want to be out. Not because they think it'll raise 
their revenue, because the iPhone is all about taking the 'ownership' of 
the customer to Apple, away from the operator.

Paul is right when he says that mobile phones are a product with a 
limited lifespan. I wouldn't see it so stark as it to be only 6 months, 
but they get lost, stolen, broken, outdated, whatever. This goes for the 
vast majority of mobile users, and whoever can pay the amount of money 
for a Nokia N95 or an iPhone is going to take a lot better care of it.

But as said, it's a niche market, with a difficult product they're 
trying to sell, in a market in which they have no experience.

- Peter