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Filling the Unlocked iPhone Gap with .Mac

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Daniel Eran Dilger
As Apple struggles to adapt its retail store inventories to account for sales flowing out of the country, the company has hinted that it may adopt other business models to target markets outside of the US. Apple COO Tim Cook has said the company is not exclusively married to the carrier revenue sharing model it began with AT&T, and which it also maintains in varying degrees with T-Mobile, O2, and Orange in Europe. Here’s how Apple could diversify its revenue options by integrating .Mac services into its mobile WiFi platform.


iPhone .Mac Subscriptions
One alternative to seeking revenue from carriers would be for Apple to tie iPhone sales to .Mac subscriptions, creating an ongoing revenue stream independent from the mobile carrier. Reader Erik Ableson sent a link to an Infrageeks blog entry describing the idea.

iPhone and .mac – Infrageeks

In exchange for the service revenue from a .Mac subscription, Apple could provide iPhone users with a variety of services, many of which are largely already in place. The iPhone already provides automatic setup for .Mac email and can directly posts photos to a .Mac Web Gallery. The new IM client demonstrated by AOL has a natural affinity for using a .Mac account, and subscribers already get an IM security certificate to encrypt their messages over the AIM network. Secured IM conversations on the iPhone would be a differentiated security feature other phones don’t match.

Podcast and RSS news feed reading on the iPhone is already provided by an online service Apple offers at no cost, hosted from the .Mac domain. On top of these features that already exists, Apple could also boost .Mac integration on the iPhone by rolling out a series of other features:

Network Data Synchronization
: direct .Mac calendar synchronization over the network, along with .Mac bookmarks and address book contacts. Keep everything in sync without requiring an Exchange Server account, or a direct cable connection with iTunes.

File Access and Sharing: Add a specialized web interface (or custom iPhone application) for browsing files on a user’s iDisk. That would give iPhone and iPod Touch users a simple and efficient way to access files without actually storing them on the device. It would also afford a simple mechanism for sharing files with other users that doesn’t require sending emails with attachments.

Back To My Mac: Add a similar interface for accessing files shared from a home computer using Mac OS X 10.5 Leopard’s Back To My Mac feature, which would allow mobile devices to look up the location of the home machine sharing files via AFP and directly access the files. Extend this to iTunes and iPhoto sharing, and users could access their home media library and albums.

Blogging: When I asked Steve Jobs if Apple would add simple text blogging to its .Mac Web Gallery, allowing iPhone users to post updates to their .Mac hosted site remotely, he blew me off with the suggestion I learn Cocoa and write the app myself. Presumably, I’d also need to be approved for Apple’s development program. Was Jobs bluffing to take attention away from the company’s future plans, or does the company not really think the iPhone users have an iLife that might involve text? Does Jobs fear that users won’t be able to type anything significant using the iPhone’s multitouch keyboard? If so, he could release Bluetooth support for his company’s keyboard, and sell more keyboards while providing users with a valuable new feature.

Apple’s .Mac service has been ridiculed and held in disdain by web pundits for years, but it also represents a vast potential, not just for sneaking some extra revenue from users buying a new Mac, but also as a subscription plan that will offer Apple’s mobile WiFi users a highly differentiated level of features that other phone makers and service providers have no ability to match.

Back in 2006, I wrote a series of articles outlining how Apple could dramatically add value to its .Mac services. The same ideas would also add value to iPhone and iPod Touch users.

hyperblogging

1. Hyperblogging: add ranking and comment tools to Safari so that users could tag articles or entire websites with metadata tags, from “kid friendly” to “mature content,” or “sensationalist garbage,” “phishing/spyware/fraud alert,” “harvested content for search engine spamming,” or “insightful commentary.” The same tools could support and interact with external sites that report phishing scams, SEO fraud, and malware sites.

Because user generated ratings and comments would be linked to their .Mac account, there would not be a problem with anonymous vandals or bots posting automated junk messages, a problem that prevents most meta-blogging tools from being very effective (or exposes them to lawsuits).

The same principle can be applied to email to allow users to report spam, which would allow Apple to intelligently and effectively create blacklists, or quarantine items, or adjust their gateway spam and virus scanning heuristics to catch messages like it, or from the same spammer.

Fixing .Mac – Idea 1: Hyperblog the Web

2. A .Mac Reputation System: integrating its support discussion boards, iTunes comments, and other web properties, most of which are already tied to an Apple ID (such as a .Mac account), Apple could enable comment input from the iPhone’s WiFi store, add custom discussion board access for browsing support issues, and link the usefulness of member’s submissions to a reputation rating that followed them from their desktop to their mobile.

Fixing .Mac – Idea 2: A Reputation System

.Macster

3. Macster – Community Profiles: Apple is dogged by pundits insisting that the company should enter the profitless world of MySpace and Facebook. While it probably makes more sense for the company to continue to partner with existing companies rather than trying to build a public community site of its own and chase after the ad revenue that isn’t going to ever support such sites, Apple should throw .Mac users a bone and set up a way for members to advertise themselves with a profile that supports relationship links with other members, presents their hyperblogging content and reputation ratings, and showcases their blogs and Web Gallery links.

Unlike the adware supported community sites, Apple’s would be supported by .Mac subscriptions. That would not only keep out the riffraff, but result in .Mac profiles being more serious and useful. Even with a .Mac profile system, the iPhone would still receive support from Facebook and MySpace, both of whom are courting the device as the hot mobile for their demographic.

Fixing .Mac – Idea 3: .Macster!

4. Secure Identity Services: Apple already vends security certificates for .Mac that automatically set up secured IM in iChat, but these could be expanded to provide signed and encrypted emails right from the iPhone, and to centrally manage VPN certificates. This would help differentiate the level of security iPhone users would enjoy over less secure mobile platforms.

Additionally, using the same tools being built into iPhone 2.0 to support Exchange Server’s remote revocation and wiping services, Apple could provide home users with the tools in iTunes to remotely kill and delete their phone in the case of loss or theft. Or alternatively, lock it down over the network so it wouldn’t do anything apart from displaying a return address and “report this iPhone found” phone number. Imagine the value of having a phone you could terminate yourself, and likely get back in after losing it.

Fixing .Mac – Idea 4: Secure Identity Services

Finder Store

5. .Mac Marketplace: I’ve been harping for a while now that Apple should start offering a storefront within the Finder to sell online stuff from books to toner carts to software titles. Integrated into .Mac, the store would provide centralized accounting. Lately, I decided it would make more sense to add such a store to Safari and offer it cross platform in the style of iTunes’ media offerings.

On the iPhone, a link to .Mac would consolidate shopping information just like iTunes’ WiFi Store and the forthcoming App Store, so users could make purchases directly from their account without pulling out a credit card. Apple needs to link up with Amazon and other online retailers to allow users to make purchases from their mobile and have them shipped to addresses stored in their account.

Partnering with Amazon could make more sense in the market for that company’s ebooks that its own Kindle book reader. For Amazon, it would only mean additional media sales at a higher margin, because the company wouldn’t have to subsidize users’ EVDO network links as it does with its own hardware.

The same principle of mobile ordering fits into Apple’s patented ideas related to retail sales and its Starbucks integration. By enabling retail stores and restaurants to publish a menu to nearby iPhones within WiFi range, users could place their own orders and pick them up without having to deal with employee interaction or wait for service, just as banking users have been using ATMs for decades.

By combining its hardware mobile technologies with the centralized information in members’ .Mac accounts, users could make purchases without handling cash and without even presenting a credit card. They’d also not need to stand in line or wait for available staff to take their order. After the transaction, they could even rank the service they received and the quality of the product as a hyperbloging comment others could tap into just like any other product review.

Fixing .Mac – Idea 5: A .Mac Marketplace
Something in the Air: Anticipating Macworld 2008: The Finder Store

6. Privacy Management
: balancing the benefits of having shipping, billing, and preference data associated with their .Mac account, Apple could provide identity management tools to .Mac to allow mobile users to, for example, send anonymous email messages using a disposable email account.

Fixing .Mac – Idea 6: Add Privacy Management

7. Enhance and Encourage Sharing: a .Mac membership would enable mobile users to share blog comments, photos, calendar events, contact information, and hyperblogging comments and ratings with other users either without restriction, or provisionally. Add in iDisk and Back to My Mac integration described above, and Apple’s mobile users could have and securely share access to gigabytes of files without storing any of it on the device itself.

Fixing .Mac – Idea 7: Enhance & Encourage Sharing

8. Subscription Music: I suggested that Apple offer .Mac users additional free content from iTunes on a regular basis to induce sales. Recent rumors suggest that Apple is investigating the idea of bundling music access for a set upfront premium on new iPhones and iPods. A separate music subscription tied to .Mac might raise less ire from competitors like eMusic, and make .Mac more attractive to a wider audience.

Fixing .Mac – Idea 8: Subscription Music

Integrating .Mac services into its iPhone and iPod Touch mobile platform would not only make the devices more valuable and competitive, but would also add a layer of ongoing subscription revenue that would enable the company to more profitably sell unlocked iPhones at regular prices in emerging markets where demand is off the charts.

Rather than paying a smuggler $800, Apple could sell customers the iPhone at the regular $399 price, bundled with a two year .Mac subscription for another $99 a year. This would rapidly develop Apple’s software service revenue and allow the company a significant budget for investing to keep the services up to date and valuable for users.

iPhone 2.0: Exchange vs Leopard Server

I really like to hear from readers. Comment in the Forum or email me with your ideas.

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26 comments

1 Berend Schotanus { 04.05.08 at 4:01 am }

Interesting point of view, I didn’t think of this. I like reading this kind of “what if” scenario, as alternative for the carrier revenue sharing model.

Well done.

2 Does the iPhone Shortage Herald an Impending 3G Release? Probably Not — RoughlyDrafted Magazine { 04.05.08 at 4:29 am }

[...] Filling the Unlocked iPhone Gap with .Mac → [...]

3 PerGrenerfors { 04.05.08 at 5:06 am }

I had .mac until about a year ago. I loved the one-click publishing and the general convenience that it offered.

What made get a gmail account instead was primarily the huge amount of spam I got. The Mail.app filter was no near enough to keep up with it. With gmail I get absolutely no spam and I have not changed my habits since switching. Although I miss the beautiful webmail interface each time I have to log in to gmail when I’m away from my own computer.

Secondly, there was the speed issue. iDisk service was just horribly slow, even on a 100Mbit connection (I was in the 6 MiB/s ballpark when I download the 10.5.2 update from Apple according to Software Update). I’m not sure if the speed problem apply to North America, but it’s a big problem my country (I live in Sweden) and in other parts of Europe as well.

I think that your ideas for new features to add sound interesting but Apple needs to deliver on the reliability and performance of existing features before moving on. The current state does not live up to the overall smooth Apple experience I get from my iPods or my Macs.

Always looking forward to your next article, keep up the good work.

4 PerGrenerfors { 04.05.08 at 5:08 am }

The grammar cop in me just realized that my previous post was crap. An “Edit” button would be nice.

5 jecrawford { 04.05.08 at 5:56 am }

@PerGrenerfors

I understood your post in spite of the “errors”.
It’s good to see that people care about grammar.

John

6 droughtquake { 04.05.08 at 6:57 am }

Sounds like your version of dotMac for iPhones would make more sense than the current dotMac does for Macintoshes.

7 John Muir { 04.05.08 at 7:26 am }

Ah: Swedish high speed broadband. The rest of us can but dream!

8 lmasanti { 04.05.08 at 10:01 am }

quote:
“Rather than paying a smuggler $800, Apple could sell customers the iPhone at the regular $399 price, bundled with a two year .Mac subscription for another $99 a year.”

My math appears to be wrong.
If Apple sell a [free from everybody] $800 it will have “$499 cost+revenue price” plus a “whole revenue” of $300.
(We are comparing 2 non-carrier revenue systems.)
Your option is “$499 cost+revenue price” plus a “.Mac costs + revenue” $198.
What’s the reason for Apple to do that?
At least, up to the time Apple needs “promotions” to sell the iPhones?

9 qka { 04.05.08 at 10:20 am }

According to your recent article ”
Are iPhone Sales Limited to Apple Fans?”, only 25% of iPhone users are also Mac users. To make the ideas you propose in this article happen, .Mac will have to be accessible from Windows.

Or it will be yet another Mac marketing tool? ;)

However, I think there is a limit to how much pushing on Windows users towards Mac that will be successful, or even tolerated.

10 Ted { 04.05.08 at 11:37 am }

Good idea, but you are missing the most important feature to lure iPhone users to .Mac — push e-mail. I boggles my mind that Apple is offering push e-mail with MSExchange (in 2.0) and Yahoo (now), but not their own .Mac

Apple needs to take care of that pronto.

11 addicted44 { 04.05.08 at 1:21 pm }

I like the idea of improving .mac. Contrary to what you have said here, Facebook and MySpace make tons of money (probably not enough to justify their valuations, but a lot of money nonetheless). Also, While .mac is overpriced and underdeveloped, it is absolutely critical for some. I love the automatic syncing between macs, as well as the painless online backup features. The Google accounts just dont compare in this regard.

12 danieleran { 04.05.08 at 4:53 pm }

@ qka: many of .Mac’s features work with Windows: email, iDisk (there’s a Windows client), all of the web tools (bookmark/calendar/contact sharing, and other stuff like HomePage and iCards).

Also, there are features of .Mac that already work with the iPhone that are unrelated to the PC platform, such as its ability to upload photos to Web Galleries.

It might make sense for Apple to provide some other new iPhone-related tools to Windows, but it wouldn’t really need to do much to make .Mac attractive to iPhone users who sync it with a Windows PC.

13 ericdano { 04.06.08 at 2:08 am }

I like .Mac. Having the ability to keep multiple Macs synced with the same calendar and bookmarks is a great thing for me. I’d like to see it extended to the Window’s version of Safari. That would be a great feature. I don’t know if you can sync bookmarks with the Windows version of iTunes and the iPhone.

It would also be interesting to have Back To My Mac enabled to an extent via the iPhone. What if you wanted to view a PDF or Word Doc or Excel file that is on a Mac at home. No problem, just use Back To My Mac, and you can navigate to it, and double touch the file, and boom……there you go.

14 harrywolf { 04.06.08 at 1:21 pm }

I want to like .Mac, but I haven’t managed to get beyond ‘its ok’ as yet.
Its just too proprietorial, and too slow and clunky, esp. with email.

Gmail is easily, imho, the best portable email app/service out there.
I would pay cash for Gmail.
I do pay cash for .Mac, but I doubt I will renew next time.
After 5 years, I haven’t had many, if any, quantifiable benefits from it.

Would not it be better if Apple made a deal with Google and let them handle all the .Mac type stuff, including any iPhone connection?

Pass .Mac over to Google, and let Apple concentrate on what they do best.
You cant kiss all the pretty girls. (I know, its terrible news!)

15 ericdano { 04.06.08 at 4:49 pm }

I’d agree that Gmail seems to be the best Email service. I have all my email addresses forwarded to my Gmail one (.Mac, Yahoo, etc). Great service. Hardly any spam either (maybe 1 or 2 make it through every other day)

16 danieleran { 04.06.08 at 5:12 pm }

I have and use gmail, but Google doesn’t offer the rest of what .Mac offers. Apple does need to improve and expand its service package (as I’ve been harping on for some time), but the potential is pretty spectacular if they do. Nobody else offers a similar package that people actually pay for; .Mac has millions of paid subscribers.

17 dscottbuch { 04.06.08 at 6:03 pm }

Re .Mac: I’ve always liked it, and don’t think that <$9/month is that much but what recently sealed it for me was Back To My Mac. This is an incredible feature that, since 10.5.2, has just worked. Multiple macs behind each of multiple routers that I can see and get to from everywhere I’ve roamed on travel. My father has his macs on my account as does my two macs at home, along with my backup (TimeMachine). I accidently deleted a file at work and just brought up Time Machine and get it from home from my backups. Its slow, and I wouldn’t want to retrieve a large file but it worked. BTTM is so much more than screen sharing. Its a great VNC client, file sharing, ssh/sftp connection and browsing around in Bonjour there are the hooks for photos and printer there.

18 lmasanti { 04.06.08 at 6:54 pm }

quote:
“Pass .Mac over to Google, and let Apple concentrate on what they do best.”

What “Apple do best”, IMO, is integration… and for that, they control every part of the system.
So, to “do what they do best” I think they must keep .mac (improving it, of course!)

19 mattrad { 04.07.08 at 7:55 am }

The real power of extending .Mac’s sync to the iPhone would be over the mobile network and Wifi. Mobile carriers have been half-heartedly suggesting that customers should backup their phone data, but the vast majority do not bother. Extending .Mac to do sync anywhere would be an important major leg-up over other mobile platforms. S60, UIQ, Windows Mobile can all do it but Apple would remove the hurdles I’m sure.

I’ve actually just written about this today as well:

http://www.allaboutiphone.net/2008/04/theres-something-else-in-the-air/

20 lowededwookie { 04.11.08 at 5:50 am }

It’s interesting all the comments about Mail’s junk mail filter not being very good. I disagree. I’ve had very little spam in my account with the first two in over three months occurring yesterday.

That being said I don’t sign up to a lot of dodgy sites either. ;-)

Admittedly it’s taken a bit of training but I hardly get any spam now.

I like this .Mac idea. I’d sign up for it just to get the iPhone which is not available in New Zealand officially yet. I know I could buy an unlocked phone but I’d prefer a legit phone instead of a hacked one.

I like the idea of using .Mac to buy stuff.

21 stefn { 04.12.08 at 11:15 am }

I like all that Daniel suggests. And all of this would become possible if Apple would take one step: Offer free .Mac access with every Mac, Pod, and Phone. Just like Google. Two reasons:

* Client side: We need offsite backup of our documents, along with our inhouse backup systems. I use Gmail for this, sending notes, files, and versions by mail to myself, thus locating a copy on the Google servers. Simple, secure, and searchable from Google Desktop.

* Server side: Once Apple has millions onboard and learning the ease and reassurance of the free service, all the premium services in “.Mac Pro” can be developed and sold over time.

22 gus2000 { 04.12.08 at 1:33 pm }

Errr, no. Nothing is “free”. Google gives away software/email/etc. because that drives traffic to their advertising-supported services. Apple is not running a business model that includes as revenue.

I’ll be happy to pay for the value I receive. I do believe that Apple gives away a 3-month trial of .Mac with each new system, but the small fee keeps out the rifraf (as Daniel has pointed out) and allows that business unit to show revenue and justify new expenditures.

I still haven’t figured out why Apple has not staffed up at .Mac and really improved the service offerings. It’s not like there aren’t plenty of Windows IT guys looking for work. :)

23 stefn { 04.12.08 at 2:08 pm }

@gus2000

In fact, there is “free.” For example, iTunes is free. I can use iTunes as my music library and never purchase an iPod or download music.

Same thing holds for Google mail. I can’t even tell you without looking what is advertised on it. Can you?

No business model? I agree with Daniel that selling premium services, as he outlined, is a great business proposition. Offering free .Mac is simply a way to market the .Mac service broadly. Not to mention all the tiny ad bits Apple could place on the service.

Just like Google.

24 lowededwookie { 04.12.08 at 10:36 pm }

Google is NOT free in the truest sense. You have to pay for Google in the sense that you have to put up with all the ads on the site. True no money is offered upfront but there is still a price to pay.

What I would like with .Mac is my profile stored on my .Mac account so all my documents are stored there instead of my machine. I believe Daniel has highlighted this before. Think of it as roaming profiles over the Internet (and also that works).

25 stefn { 04.13.08 at 1:37 pm }

If we define “free” as completely “ad free,” then nothing with a brand or logo on it can be called free. And since no product or service exists without a brand or logo, then literally nothing is free. In other words, that definition is useless.

I define free as a product or service I don’t pay money for and that does not demand I do anything further in the way of service or behavior to purchase it. So iTunes is free and so is Gmail, by that definition.

26 Apple’s Mobile Me Takes On Exchange, Mobile Mesh — RoughlyDrafted Magazine { 06.09.08 at 11:29 pm }

[...] Filling the Unlocked iPhone Gap with .Mac Apple – MobileMe I really like to hear from readers. Comment in the Forum or email me with your ideas. [...]

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