Daniel Eran Dilger
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The big 3.0: How iPhone will shift peripheral devices


Daniel Eran Dilger

The biggest news to come out of iPhone 3.0 is its new support for external peripherals, a move that will expand the iPhone and its iPod touch sibling into new territory as a central hub for controlling all sorts of embedded devices. It will also bring Apple’s new mobile platform even closer to the open-ended premise of the old Newton Message Pad. Here’s why Apple’s modern mobile platform will work out better than its first attempt in the early 90s, and why competitors will be hard pressed to duplicate its success.


Apple’s unveiling of the iPhone 3.0 game plan was received by a crowd of journalists that seemed preoccupied with listening for mention of technology buzzwords: Adobe Flash, MMS, “multitasking,” and of course, copy and paste. That left the tech media yawning over the inevitable release of text selection and copy and paste features, unimpressed with the “new” MMS, and mourning Apple’s snubbing of Flash and its insistence upon not allowing third party developers to install invisible background processes.

(For what it’s worth, the iPhone has always performed multitasking, that’s why you can receive text messages and calls while playing a game as the iPod app also plays music. It just doesn’t allow third parties to install background software for practical reasons, not some technical deficiency).

What the tech media at large seems unable to grasp is that Apple isn’t just marketing a bag of hardware specifications wrapped up in a thin sack of operating system support. Apple is building a long term platform. That’s why they keep holding up the device bag of the day against the iPhone (the LG Prada, Motorola Q, anything HTC sells, the TMobile G1, etc), wonder aloud why the specification numbers of its shoddy competitors aren’t ‘killing the iPhone,’ and then rinse and repeat two months later with a new series of bag destined to be soon forgotten as well.

Mobile device makers seem to have no real concept of developing a long term platform. As one of the first companies to successfully release a personal computing platform back in the mid 70s with the Apple II, and as the maintainer of world’s longest running graphical desktop platform with the Macintosh, Apple knows something about building sustainable platforms.

iPhone 2.0 SDK: The No Multitasking Myth
Gone in a Flash: More on Apple’s iPhone Web Plans
Flash Wars: Adobe in the History and Future of Flash
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SCO, Linux, and Microsoft in the History of OS: 1980s

The Challenge of Mobile Platforms

It turns out that mobile platforms are more difficult to maintain. Apple’s efforts to introduce the original PDA with the Newton Message Pad in the early 90s were complicated by the problems inherent to mobile devices: battery life, size and thermal envelope constraints, limited processing and storage capacity, and the one-two punch of mobile networking expense and bandwidth restrictions.

To work around these problems, Apple delivered advanced mobile hardware with the Newton Message Pad that required the company to develop an entirely new operating system, co-develop a brand new microprocessor architecture (its ARM architecture remains the most popular chip design in mobiles today), and market the device so effectively that a decade later, the thing is still a familiar household name (at least among technically savvy households), unlike most other devices sold in the mid 90s, or even last year’s bags.

However, the Newton still failed, for a number of reasons. The primary cause of death was its high price tag; users were expected to drop about $1000 on the Message Pad 1000 to find out whether the Newton would ever become a viable platform (according to the Consumer Price Index, its 1994 price tag would be roughly $1400 today.) Developers were left to wonder if consumers would ever adopt the platform, creating a catch-22 where a lack of necessary software was retarding sales, and slow sales were preventing the device from gaining traction among developers.

Newton Lessons for Apple’s New Platform

The Failure of PDAs

The Palm OS arrived on the scene in 1997 just as the Newton stumbled towards the grave. It was met with wild initial success, in part due to the more affordable $300 price target of its much simpler hardware. However, it too could not sustain long term growth as the PDA market fizzled as the dot com bubble of gadget lovers popped, leaving little free cash to throw around on toys.

Microsoft hoped to take over the emerging market for PDAs and handheld computers with the release of Windows CE, following the same software-centric platform strategy that had launched DOS and then Windows into ubiquity. However, WinCE devices were unreliable, expensive, and impractical in terms of battery and processing capacity, and the software was buggy and ugly to the point of being unusable. Additionally, there was no IBM hardware monopoly around to launch Microsoft’s new mobile version of Windows, leaving it to rot on the vine even as the company struggled to cultivate a market for it over the next decade.

Microsoft has also scrambled to throw up a series of other mobile computing platforms, from Tablet PCs to HandHeld PCs to Pocket PC to Palm-sized PCs to “Ultra-Mobile PCs,” some of which used its desktop Windows OS, but none of which has seen any significant success.

The Egregious Incompetence of Palm
The Spectacular Failure of WinCE and Windows Mobile

Mobile Devices’ Launch Failure

The failure of all of these mobile software platforms relates to the reality that artwork needs to be packaged and sold for an artist to be a commercial success. The work of software developers, just like artists, musicians, and actors, can be extremely valuable when appropriately packaged.

However, the talent behind those works has no intrinsic value without the packaging. Artists without effective promotion fail commercially, because nobody can pay them what they are worth without spreading around the cost of supporting their art, something Steve Jobs is very good at orchestrating.

The Newton involved a lot of talent, but wasn’t packaged in a way that made it a commercial success. Palm was a one hit wonder without the ability to sustain its fame. WinCE was a talentless flop that couldn’t succeed even with the resources of the world’s richest and most powerful tech monopoly.

What the next mobile platform needed was a star vehicle. In the late 90s, Jeff Hawkins, Donna Dubinsky, and Ed Colligan of Palm left to form Handspring. They decided that the vehicle for bringing the PDA into the mainstream would be the smartphone. In 2003 Palm acquired Handspring to help migrate its failing PDA business into the smartphone business with the new Treo developed at Handspring. Microsoft also scrambled to copy this by focusing WinCE on the new Windows Mobile brand in 2003.

Rebranding a failed PDA operating system had worked well enough for Symbian (derived from Psion’s EPOC PDAs), but only managed to keep Palm OS and WinCE on life support in the half decade between 2003 and 2008. An even better star vehicle for propelling mobile devices into instant fame was instead discovered by Apple.

Origins: Why the iPhone is ARM, and isn’t Symbian

The Path to Smartphones

In 2001, Just three years after ditching the general purpose Newton, Apple developed a new mobile device: the iPod. It had some perfunctory PDA features, including a calendar, contacts, and simple games, but it was assigned a primary task: music playback. Attaching the iPod to an existing, wildly successful market for music playing devices turned out to be extremely smart strategy.

The iPod offered to do nearly everything other players could do, apart from recording audio and a few other niche features. However, it also supplied a nice interface and a offered a simple syncing connection to the Mac and PC, something other audio player makers including Sony had not figured out how to do. Once it mastered audio playback, Apple licensed audiobooks through Audible, added podcasting support, and later added video playback. It then got started with iPod games.

Apple succeeded in building an iPod empire, licensing hardware accessory makers and working with select software developers to create game software. The result was an optimal position to launch its new software technology, using smartphones as a second stage vehicle to establish an even more sophisticated mobile platform derived from the desktop Mac OS X.

In 2007, Apple launched the iPhone as a high-end iPod, phone, and web browser device to a large, enthusiastic user base of Mac and iPod users. The iPhone effectively attached all of the iPod’s goodwill and content expertise with the technical superiority of Mac OS X to a new market even larger than that of music players, a market dominated by products that were largely based on simple devices trying to operate well out of their league: RIM’s sugar-frosted BlackBerry pagers and the glorified PDAs from Palm, Symbian, and WinCE.

Being a smartphone meant that the iPhone could be subsidized by mobile revenues, allowing it to sell at an upfront cost that consumers would swallow, particularly given that the alternatives were rarely any cheaper, if not more expensive. While many comparisons have been drawn between the iPhone and the Newton, the iPhone remained defined as a smartphone with some accessory features, not a general purpose mobile “companion” computer like the Newton.

From Dedicated Smartphone to Central Hub

While the original iPhone was designated entirely as a phone with a WiFi browser and iPod media player, iPhone 2.0 firmware enabled third party developers to add limited new software features, resulting in rich Internet-connected applications and 3D games using the same development tools available on the Mac. However, iPhone 3.0 remakes the iPhone into something far more than a smartphone. It’s now a central interface for controlling all sorts of hardware. It’s now a general purpose mobile computer.

Apple gave examples of a stereo dock managed by the iPhone, or a radio dongle tuned by the unit. It also brought on stage a demonstrator showing off a Bluetooth-enabled blood sugar monitor and depicted a blood pressure cuff attached to the iPhone. This new capacity signals something bigger than just a new feature. The third generation SDK expands third party support to hardware-based applications. This is very big.

A broad range of accessory devices won’t need to be designed with a user interface, but instead only need a USB interface or Bluetooth support, something many sensors and input devices already have. Everything from gym treadmills to medical devices to barcode readers to remote controlled devices to tuning systems to diagnostic components can be made “iPhone-ready” by simply developing an App Store title for them.

Add in Bonjour Bluetooth automatic discovery, and you have a very sophisticated way to connect to accessory devices, provide them with multitouch interface controls, log and chart statistical data over time, and upload that data to a computer or online cloud service in the pattern of Nike+iPod.

Ten Big Predictions for Apple in 2009

The Incremental Road to Progress.

The iPhone is now a general purpose device far more useful than the wide-open Newton could ever have been, expressly because Apple policed its platform and regulated it to develop according to a strict strategy. Had Apple thrown its platform to the open community to “do it themselves” in the manner of Google’s Android, we’d have seen a brief flurry of interest followed by its inevitable collapse due to a lack of commercial sustainability, just like other distros of Linux.

Had it attempted to run before it had mastered walking by rolling out a massively ambitious iPhone 1.0, we’d have observed another grandly massive undertaking like the Newton collapsing under its own weight without ever being finished, much like everything else Apple did in the early 90s, from PowerTalk to QuickDraw GX. The iPhone needed progressive packaging that released technology according to a strategy, not to fill a marketing checklist assembled by the sales people who ran the old Apple, and who now run Microsoft and Sony and LG and Nokia.

Apple is now following the same path as every other commercial success: building progress upon incremental steps. It first established a user base, then it opened up third party software, and now it’s opening the floor to even more sophisticated uses centered around hardware peripherals. All along, the iPhone has maintained a clear product description and has competed well against the offerings of other companies. That will serve as a general barrier preventing other companies from simply duplicating its efforts. Apple has built too much on too many fronts to replicate in a cloner catchup sense: iTunes, SDK development tools, licensing programs, retail stores, and so on.

1990-1995: Apple vs. Microsoft in the Enterprise: PowerTalk

Platform Problems for Competitors’ Hardware Integration

Palm and Microsoft have long allowed their mobile developers to build third party hardware peripherals, but they both lack a secured software market and sales volume similar to the iPhones Apple has distributed over the past year. Microsoft likes to point out that all of its hardware licensees together slightly outsold the iPhone last year, but the problem is that Windows Mobile phones are all over the map, ranging from simplistic devices with tiny displays that lack a touch screen (Microsoft’s former definition of “Windows Smartphone”) to stylus driven Treo-style handsets, to “Handheld PC” style gadget phones with slide out keyboards.

Windows Mobile devices don’t all use the same standard docking connector, don’t all have similar processing and storage capacities, and don’t have cohesive abstractions for GPS, WiFi, or cell tower location services, but instead all use different components, selectively include or exclude features such as WiFi or Bluetooth, use different screen resolutions, and so on. Windows Mobile isn’t a cohesive platform, its an assortment of phones confederated together by marketing fluff.

Many Windows Mobile partners, including last year’s phones from Sony Ericsson and Samsung and this year’s models from LG, are now putting their own user interface over the top of the operating system to cover up any similarity to other Windows Mobile phones. The Meizu M8 Chinese iPhone knock off actually uses only the WinCE core OS and builds its own layers on top to end up with something resembling Apple’s work more closely than Windows Mobile ever could.

 Wp-Content Uploads 2009 02 200902161602-1

Windows Mobile 6.5 shows clever burst of originality. Haha no.
Did Microsoft kill Android at Mobile World Congress 2009?

When Diversity is Not a Strength.

Google’s Android seeks to be a clone of Microsoft’s Windows Mobile, and will suffer the same problems as it attempts to pave over all the component diversity that has complicated developers’ efforts to build mobile software that works well on more than a few models.

The Symbian platform has similarly been fractured between the three major personalities offered by Nokia (S60), Sony Ericsson (UIQ) and NTT DoCoMo (MOAP). Nokia is trying to unify all that with the Symbian Foundation, but even Nokia uses its own Nokia OS for its feature phones, Linux for its WiFi tablets, and Symbian OS only in its smartphones. And like Windows Mobile devices, Symbian phones are fractured by major hardware differences.

Microsoft, Google, and Nokia all talk about diversity in hardware features as choice, but Microsoft has never valued diversity in the platforms its PC software ran upon. It knew better than to release the Xbox as a software platform that could run on a variety of manufacturer’s hardware designs. Its PlaysForSure diversity of music hardware and stores failed in part due to that tyranny of choice.

Will Windows Mobile Play DOS to Apple’s iPhone?
Will Google’s Android Play DOS to Apple’s iPhone?
Myth 9: iPhone Unable to Penetrate Europe Due to Symbian Dominance

The Sorry State of Mobile Platforms.

Microsoft knows this. It also knows it can’t release a phone to compete directly against the iPhone because it would get trounced just as soundly as the Zune was. Microsoft has no special hardware expertise. It has no successful media store, no proven capacity to erect a successful third party market for mobile software, no retail operations in place nor any history of retail savvy, and no OS technology well suited for deploying a competitive smartphone.

All Microsoft can offer is a promise to fix its failed platform which has gone nowhere in the last decade. All Google can offer is a hope to beat Microsoft at its own game. All Symbian can offer is rapidly slipping position as the dominatrix of a market that has seen, until recently, very little real sophistication among its competitors. All Palm can offer is a deathbed intention to reinvent itself with a spurt of innovation that it should have put some effort into a half decade ago before it had shriveled up into a frail corpse enslaved to Windows Mobile.

Despite having “only” a 10% share of all smartphones globally, Apple’s iPhone is used to browse a plurality of the web’s mobile traffic, and about half of America’s mobile web traffic. Even more importantly, it has the only functional apps store, which is also tied into the world’s largest digital downloads market: iTunes. Combined with its common hardware platform stretching across an installed base of 30 million devices sold within the last year and a half, that makes the iPhone platform ideally positioned to lead as the general purpose device of choice for both users and developers.

Who saw that one coming?

Palm Pre: The Emperor’s New Phone
Why Apple’s Tim Cook Did Not Threaten Palm Pre

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  • http://www.isights.org/ whmlco

    This is huge. Add an IR adaptor and you have a great touchscreen remote control. Add a 5MP camera or video camera. Add a good stereo mic for a portable digital recorder. Wireless sensors. Sports performance recorders.

    This could be as big as the Mac. (Or bigger.)

  • OlivierL

    “Who saw this coming ?”
    Well, I did. So did I knew that 2.0 would come with 3rd party apps. It seemed obvious with the release of the iPhone that if Apple was holding its SDK it was not because it didn’t want them but that it didn’t want them now.
    Actually, I was even surprised that 3.0 could be announced and available in 2009. I thought that a 2.5 with just the software features would be available in 2009 so a strong platform would mature.

  • Pingback: The big 3.0: How iPhone will shift peripheral devices … | InfiniteMobiles.Com()

  • http://coderad.net StrictNon-Conformist

    What would be very interesting is if Apple came out with their own version of a net book, one that’s all ARM, and is basically a scaled-up iPhone. Imagine if they further did the odd-sounding solution of having the OS report to the software that it had exactly the same hardware capabilities in terms of RAM, sensors, and CPU capacity as an older iPhone/iPod Touch, but more than one application (each in its own sandbox, but now with the ability to cut/copy/paste between apps) could run at a time, also keeping in mind using a multicore ARM, or more than one. Or, perhaps (this is where things may get curious and more complicated) the apps were able to see all the hardware, but this provides another target to develop for in terms of testing. It’d be best if the iPhone OS did proper resolution-independent drawing of all GUI stuff, which I don’t believe it does now: this is probably something for iPhone OS 4.0, would be my guess.

    With a much larger form factor, the battery duration could be much longer: someone could potentially use one of these actively, without plugging it in, for 8 or more hours in a day before needing to recharge. With the much larger screen, having it with WiFi, Bluetooth, and cellular connectivity, it’d also make a great device to have streaming from Apple TV to it, and if it had (preferably) a better camera, also stream to Apple TV, as well as a main system, even a webcast, though something that large may get tiresome to hold up as a camera: but, with a much better camera, that large of a screen, more processing power and RAM, and presumably more Flash that can take more write cycles, it could also be a most interesting portable media content station that allows you to edit video right as/after you recorded it, making it the next killer system, all with a huge existing base of software before it ever comes out: at the rate things are going, there’ll be well over 35,000 apps for sale before the time 3.0 is out. Either that, or Apple may be working on a separate iPodCam that has enough power to do all that editing and recording, and that’d fall under Apple’s directive of creating products that’d have a large enough potential customer base due to it meeting common user’s needs (which is why there’s no XServe yet: not nearly enough demand to make it profitable).

    But again, by making a netbook-sized device with a decent camera, perhaps better speakers, better processing/RAM capacity and a higher resolution screen, there are a lot of places that could be very useful, where the iPhone/iPod Touch isn’t quite the right form factor: artists would have it much easier to do art creation with a much larger device, whether they be sound editors, video editors, or just using it for an incredibly powerful painting set using multitouch, and for school purposes, one situation where I personally wish I could have used a computer for neatness, but nothing would ever work in a meaningful way: math class, more advanced than basic arithmetic, where you have to do graphing, complex equations, etc. which there’s simply no way to quickly hack out with any portable system or laptop I’ve ever seen. Also, using such a beast using Bluetooth/WiFi could be an absolutely great educational device for electronic text books where you can annotate them as you wish, and the instructor/teacher can lead a class through the material, and students only need to carry one device for everything. Ok, maybe I’m dreaming :)

    There’s always that question, though, of both price (I could see it making the most sense if it were subsidized by a cell carrier) and size (too big to fit in a pocket, too small for a laptop case) because that’s really why, other than the keyboards and screens of the time of past PDA’s being too small to be useful for me, I never really seriously considered a PDA: since I couldn’t carry them in a pocket, they were simply more hassle than I could ever see them being worth. Oh, and I can’t think of any PDA that’s had nearly as interesting of software available :)

  • http://planetenpaultje.nl Planeten Paultje

    All manufacturers of dedicated data loggers (especially for education, though maybe less for research and possibly even less for industry) will feel the breath of death in their necks. They will have to adapt their probes to fit the iPhone/iPod Touch family and focus their efforts on that in order to be able to survive. Edu suppliers such as Pasco, Vernier, CMA/UvA and the like will have to rethink their businesses. Actually, I talked to some CMA/UvA people in January and they were wondering when Apple would open up the iPhone hardware as OS V3 will now do. Obviously there are opportunities here for new manufacturers of probeware too if the existing firms don’t act fast enough.

    This is huge indeed. I hope probe prices will come way down as a result of a mass market emerging in the next few years.

  • http://jonnytilney.com Jon T

    The peripherals bit is so huge, I agree.

    I can imagine the larger form factor being tied to a still and video camera that is little more than a viewfinder and lens, putting everything on the device in your pocket or bag. A whole new form factor for capturing images – bring it on!!

  • Michael

    “Who saw that one coming?”

    I think after Apple started adding all those PDA-like features to the original iPod, I started thinking about how it could become a viable mobile platform. When I saw the demo of the iPhone at MWSF2007, I thought, “This is it.” Although, I was a little upset with the naming of the iPhone and its operating system. It pigeon-holed the device into the smartphone category. Even after two years of being around it is still grouped in with “smartphones” – something I’ll never understand – even after the release of the iPod touch. Most people can’t see the forest through the trees.

  • majipoor

    Your analysis seems so obvious and so obviously correct to me that I cannot understand why almost nobody see the pig picture instead of focusing on the feature flame war.

  • watchdog

    Great article summarizing Apple’s strategy. Jobs pretty much told everyone that “it’s the platform, stupid” at the conference call back Oct. I do want to add that Apple made two great strategic moves to set this up:

    1. Recognizing that the iPod (and its future iPhone) was/would be a different market than the Mac, and making it and iTunes work for Windows PC users.

    That strategic call set in motion the huge base of users to which to sell its new mobile platform (when technology was ready to make it happen). Contrast this to Microsoft who is having a hard time deciding which products defend its franchises and which don’t have to.

    2. Marketing and selling its mobile computer platform as a cell phone, as seen by choosing the name iPhone, and fighting with Cisco and others over the name. (“Phone” reaches close to all people, so primary. iPod – the best iPod ever – reaches all iPod owners, so secondary.)

    Microsoft, Palm Nokia, and others have tried and failed to create a mobile platform (i.e., PDA, UMPC, MID), because users couldn’t see such a device as something they would want to carry with them all the time. But they were already conditioned to carrying a phone, so emphasizing phone (plus the added benefit of iPod) allowed them to sneak the computer in. It’s like a trojan horse strategy. Sales of the original iPhone (and iPod touch) created an initial base of users, which would be attractive to developers once the SDK was ready. So the chicken-and-egg problem (mentioned in your article as plaguing the Newton) was avoided. In addition, on a parallel course, the iPod touch was sold as a better iPod for those who didn’t want a phone & contract, and to people in those places where negotiating with carriers would delay iPhone’s arrival. This added a bit to the base but also directed developer’s to think about apps that didn’t need 3G.

    The iPod touch, though, is really the second leg (iPhone being the first). It couldn’t really take off until SDK was released and apps started rolling out. But once apps were launched, the iPod touch was heavily marketed as a games player, and it was a big seller in the last Christmas quarter.

  • darwiniandude

    Netbook / Tablet? No Apple, don’t do it. Too big for pockets, if you have room for a netbook you have room for a notebook, IMO.

    1) As mentioned above a camera shell where the iPhone docks to form the viewfinder/storage/gpstag/flikr uploader
    2) Pocket sized radio controlled cars and helicopters, Bluetooth, iPhone is the remote
    3) Fat iPhone case with 4400mAh Li battery, Dpad, buttons, 2x analog sticks, finger buttons behind (like a ps2 dual shock controller that the iPhone sits in the middle of) supported by most appstore games. This device will also have better built in speakers, and a headset passthrough for using the iPhone headsets mic for in game speech.
    4) Occiliscope / multimeter docking unit. It’s a fat case with big battery that you slip the iPhone into, it has probe connections, properly fused, and excellent test / measurement software with graphing and history.
    5) GPSbox: ruggardised feild gps case with clear weatherproof lid, long battery life and Bluetooth GPS compass.

    The traditional phone companies won’t know what hit ’em.

  • Michael

    Oh… the other I wanted to mention that Daniel brought up…

    Where the hell have all the others been this time? Especially the almighty Microsoft? How many times does Apple have to succeed to prove that Microsoft got lucky in the 80’s? They’ve been riding this monopoly that was handed to them by IBM and Apple and instead of innovating they’ve sat back and reaped the benefits while crushing competitors and driving them out of business. I love when people today say things like, “Apple needs the competition, otherwise they never would update the iPhone…. blah, blah, blah”

    Honestly, Microsoft, Palm, Nokia all competed in the mobile space for the last decade, where’d that get us? Absolutely no where. It took a company like Apple to step in and shake things up. What the hell were they thinking, that everything was as is and always will be? Nokia is the only one that will survive, if only because of their marketshare… they have time to modernize their platform. Microsoft got caught with their pants down screwing their customers and it’ll take an act of God (or Ballmer crying and praying to God) to ever recover – Apple is going to prove once again that they cannot compete on a level playing field. And Palm is betting on the latest media Jesus Phone to save themselves. A phone that pretty much replicates OS X’s Dashboard. Honestly, how hard would it be for Apple to release a Dashboard layer on the iPhone and kill Palm’s entire marketing scheme? I still don’t get how people think the WebOS is a technological marvel and that it is more advanced than the iPhone OS, which is a DESKTOP operating system running on a mobile device.

  • http://www.iphoneventures.com sanjayp

    BOOYAH…haha love the closing…i’m reading it to myself again.

  • GwMac

    To paraphrase James Carville ” It’s the network stupid” All these new features are nice, but there are a lot of people very happy with their current providers and plans. AT&T network sucks where I live. They don’t even offer 3G. Verizon and Sprint by comparison have had 3G here for over two years now and far better voice coverage as well. Regardless of what new software or hardware features Apple may add to future iPhone models, until they start selling them to other carriers they will eventually reach a brick wall, at least in the USA. After all what good is the phone if you can’t even get a signal from your house?

  • watchdog


    No doubt that the 4G LTE iPhone will be available on all carriers. But in the meantime, there’s still 70m or so customers who’ve already chosen AT&T.

  • http://home.comcast.net/~daguy daGUY

    Dan, excellent article as always.

    I agree that even though cut and paste and those kinds of features got the most attention, peripheral support is far more significant and really interesting. This has the potential to change the game completely – the iPhone becomes a general-purpose device that can simply do *anything*.

    This exemplifies the wisdom in Apple’s decision to build a unified *platform*, not just a singular device that floats around with no defined purpose or strategy. They now have 30 million devices that ALL run the same OS; all use the same input method, display, and dock connector; and all connect to the same store to purchase new content. How will other companies possibly compete against this with their fractured “platforms,” where every device exists in its own little world, incompatible with everything else around it?

    The competitors can’t “catch up” because they focus on the device, not the platform. They throw out something that matches a feature checklist and then act surprised when it doesn’t stick. The platform is where the true success lies.

  • http://home.comcast.net/~daguy daGUY

    Also, couldn’t help but notice this in your article from January (10 Big Predictions for Apple in 2009):

    “[Apple] has the potential to make the iPhone the touch screen display and control pad for literally millions of devices…from kitchen appliances to cars to stereo equipment to security systems. Everything will simply advertise itself, initiate a secure connection, authenticate, and then allow for ubiquitous control from a single, pocket sized device with a standard, intelligent human interface.”

    You nailed that one!

  • GwMac

    Well there are around 275 million of us that have not chosen AT&T. AT&T is and will continue to be the weakest link to faster iPhone growth. Until that umbilical chord is cut Android, Blackberry, and even WinMo have some breathing space to improve. I can’t tell you how many people I know, including myself, that would love to get an iPhone but cannot because of things like coverage, no 3G, or much better plans. No way in hell I am giving up a $30 a month unlimited everything plan on an HTC Touch Pro for an iPhone with a far inferior voice network where I live, no 3G at all, and pay over twice as much for fewer minutes. WinMo maybe quirky and less intuitive but it gets the job done.

    By the way Sprint, my carrier, uses WiMax and not LTE.

  • http://coderad.net StrictNon-Conformist

    Well, that’s an interesting statistic to pull out of your rear about 275 million that have not chosen AT&T, because that’s clearly merely a silly wild a$$ guess: there are some unknown number (well, unknown to me, anyway, and clearly unknown to you!) that do not have and absolutely refuse or are unable to afford a cell phone plan, or use only land lines for whatever reasons. I have 2 brothers and 4 sisters, and 3 of my siblings don’t have cell phones at all. Assuming everyone has a cell phone or wants one is a dangerously flawed expectation: some people, regardless of their income and other factors, absolutely do not want one due to being diametrically opposed to being tethered by others expecting them to always answer their cell phone, which, when abused, becomes an electronic ball and chain.

    And that, GwMac, is where Apple has all the other cell phone makers beat, hands down, for those uncelled people: Apple has something for them, too! And, from their latest stuff, well, that’s almost half the platform by numbers itself.

  • GwMac

    Actually that was a typo, I meant 225 not 275 since he quoted 75M for AT&T. Since Verizon has around 84m, Sprint about 50m T-Mobile 32 m and the others around 33m we can estimate that around 200 million people currently have a cellphone with a company other than AT&T. That is a pretty substantial market wouldn’t you say?

  • http://coderad.net StrictNon-Conformist

    Gotta watch those typos :)
    I added up all your numbers, and got 274 million: that’s an interesting number, all considering how many are little kids and how many cell phone-averse there likely are, or just incapable of affording them, considering IIRC the US has around 300 million (at least, as counted by census, which… should be retaken next year, IIRC, at the federal level). I don’t know how many truly little kids there are that don’t have them, and I suspect there’s some small percentage of people with > 1 cell phone, for whatever reason.

    One of the curious things I learned when I was working a contract at Coinstar as a developer is there’s a fairly large population of the “unbanked” meaning people that don’t ever use banks, and they were working furiously to try to get those customers. I realize that may seem odd, but how many people that are unbanked are also uncelled?

  • tundraboy

    A year or two ago I started to advance the notion that iTunes is the secret sauce in Apple’s non-Mac device business. If you’re already managing your iPod on iTunes, you don’t want to go to another interface/website/app to manage your mobile phone, or your home hifi, or your media streaming device.

    It’s a barrier to entry that is 14 feet high and it’s why Zune, and WinMo, Amazon downloads, and all those other would be competitors have failed, are failing, and will continue to fail in their efforts to knock Apple of its perch. They can’t even use Fairplay as an excuse anymore. iTunes offers one thing that the consumers value most of all and which only Apple seems to realize: c-o-n-v-e-n-i- e-n-c-e.

  • harrywolf

    The iPhone hasn’t done anything new, it has simply made the old ideas WORK properly.
    Listening to music on your phone isnt new, but when I tried to do it on some Motorola thing 3 years ago, it was USELESS.

    I remember being very happy when I saw the iPhone and knew that I would be able to finally listen to music on my commute without missing a telephone call.
    Yet in the six months before it appeared and in the 18 months before it came to Canada, not ONE other company was able to play my music on their phone and allow calls to fade out and fade in the music/call.
    Not ONE.

    Surfing the web on your phone isn’t new: when I tried to do it on the same Motorola, it was there, but it was seriously CRAP. It was not a useable option at all.

    I know that the first iPhone wasnt always the very best actual phone, but it did/does everything so well, that it became the best phone.

    Now, of course, it is a great phone anyway – but making it all work PROPERLY allows the customer to quickly forgive or not even notice weaknesses.

    There are weaknesses, but I dont know what they are – the thing is so overwhelmingly GOOD.

    The iPhone appears to be a new device, but its really just the first intelligent build of a number of older devices.

    I wish someone would apply the intelligence to building a car, a house, and a number of other CRAPPY things we have in our world.

    If Apple can do the intelligent thing, isn’t there anyone else out there that can do this with other products?

    Perhaps Steve Jobs really is someone VERY special – but can he be the only one?

    The iPhone does nothing actually new; yet it is the most brilliant design of all.
    Can our world be radically improved by a simple re-imagination and re-design of existing circumstances?

    The iPhone and Apple tell us clearly that it CAN.

  • Michael

    awesome article dan :) i can’t believe 3.0 is coming out soon already, it seems like 2.0 is so new… you don’t realize a year passes and you wait for microsoft to release something, anything, a bug fix? and then apple comes along and releases a host of new features for a mobile phone, a new desktop operating system (snow leopard), and new models (iMac, iPhone 4G, unibody Macbooks). HOW DO THEY DO IT?!?!

    Maybe the media just misses the point because people would rather read things negative about Apple because that’s what sells magazines since Apple is the one usually doing amazing things… how sad. Heh, you notice that Microsoft is hardly ever mentioned in a article anymore compared to the ’90s? No surprise there, there’s nothing negative to report on, because they’re NOT doing amazing things, so they can’t nitpick anything but praise vaporware features. What ever happened to Microsoft bringing multitouch to the consumer by Vista, oops, sorry deadline slipped again :( There’s so many good articles by Dan I can’t begin to tell people where to start, just start reading ;)

    Bias alert: I own a 2006 Macbook Pro and it has overheating issues. My iPhone 2G got replaced 3 times. And yet, even though both of these products have issues, I keep coming back, because there’s no alternative in terms of user interface. There are things on the Mac that you just simply can’t easily on the PC (or made even harder with Vista, thanks to annoying UAC popups and cryptic diagrams). I guess this is a shortcoming of Windows, because Microsoft doesn’t understand how to make things easy to use… they think that features buried in menus is the best way to present features to the user, in their endless quest for delivering features that simply aren’t used because they’re too hard to set up (unless you have the skill of a computer hacker). In reality, Apple has got it right, there should be alot of functionality built-in, but you have to balance menus and buttons so that the interface is simple to use too.

  • Dorotea

    Really looking forward to an FM radio accessory. I really want that functionality. I can’t connect the corp network and only have an iPod Touch… so I’d like to occasionally use this type of functionality.

  • tmay


    Excellent anaysis.

    One thing that I am curious about, is whether there will be further convergence that will allow the Mac OS to adopt these same peripherals, or in fact, when the iPhone OS will be able to itself act as a peripheral to the Mac OS (though there are already apps that use WiFi connection; an iPhone as a numeric keypad as an example).

    It would seem to me that at some point in the future, the only differentiation between the Mac OS and iPhone OS will be the interface (touch) and adopting that into the Mac OS will be the Holy Grail of convergence.

    I can see this happening in the not too distant future.

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  • iStevo

    One more great article Dan! The major strategic move in iPhone OS 3 was interdevice communications. Now imagine an iPhone that can be used as an Wiimote to fully remote control an Apple TV, ! But a new Apple TV take 3, running iPhone OS on a multicore ARM chip, imaginations’s power graphics and with access to a Premium App Store, with HDTV content, power games and video conferencing apps. Apple TV would not be a hobby anymore! The other move will be an Apple iTouch netbook, with a 9″ screen, also runnning iPhone OS and the same Premium Apps on hardware similar to the Apple TV. Apple has always hinted that the iPhone was a platform, so it would make a lot of sense to extend this platform for the Apple TV and an Apple netbook, but with more powerful hardware and running premium apps. All of this might not happen in version 3.0 yet, but for sure in a 4.0 version next year. The iPhone OS platform will be huge, bigger than the PC ever was! It will be eventually rebranded to iTouch OS and will dominate handhelds (iPhone and iPod), netbooks, set-top boxes (Apple TV) and large touchpanels (wall and table). PCs will become a much smaller market, focused in individual productivity apps (MS Office, Adobe Creative, Professional apps, etc), just like the mainframes became primarily just servers. Very few people can see this coming, even after iPod and iPhone successes. Many people still do not believe it. But very differently from the Mac in the 80’s, this time Apple has Steve’s leadership and Microsoft does not have IBM’s help neither Bill Gates’ “smart” sales tactics. Apple and Steve are not invincible, but what the competitors are doing right now is nowhere near to offer a threat to Apple’s long term strategy: the dominance of the next computing platform and ecosystem. Daniel’s articles are great because they show a great understanding of where Apple and the future of computing is going. The good thing for us, proud Apple fanboys, is that the competition and the naysayers will ignore all this and Apple will move on with Steve’s bright vision and strategy.

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  • http://blog.cytv.com cy_starkman

    What y’all Americans don’t realise with the AT&T debate. Is this…

    … the other 5.8 BILLION of us don’t have the “I don’t want to be on AT&T” issue to slow the growth. The USA is A market. Apple was wise in using AT&T (or whichever) to Beta test the iPhone close to home before upgrading it to be used globally.

    I too found it very interesting how the media did the “about time” stories totally focused on the non-news. I feel that this was the actual purpose of the media release. That way, in June the media won’t be reporting the “about time” story muddling up the real stories to be spoken louder then. ALSO, it makes a continual marketing machine out of the media for 3 months telling everyone that the iPhone now has everything it should have had and is AS good as all the other smart phones effectively melting the -blinker- barriers some have had (both rightfully and otherwise) to purchasing. This preps the market to have no basic complaints, see a level playing field (even though it isn’t anyway) and then be stormed by the actual new features.

    The peripheral connection ‘mention’ was only one of the floating words on the screen that was of great significance. This also has the potential to kill off the one last “gripe”, that of the keyboard. Easily hook up your wireless keyboard now… if anyone bothers to make one.

  • Steve White

    A good, informative article.

    It’s interesting that the two best smartphones on the market, the iPhone and the Blackberry, are the two that worked to develop a platform that fit user needs. As Daniel carefully notes the iPhone is a platform. The Blackberry is as well and that’s why it has survived nicely. Whereas the iPhone is all about a graphical interface to bring the world to your hands, the Blackberry is all about getting text to and from your hands. E-mail, messaging, etc., all for the corporate user that works very well. Like Apple, RIM found a long-term message: in their case, it was “we’ll keep you connected via text to the world.”

    Daniel noted in another article that RIM has begun to stray from this. The ‘Storm’ is RIM’s attempt to counter the iPhone, and it creates more problems for RIM than for Apple, in that it begins to dilute the RIM brand. That fractures their own market: are they text or are they just another iPhone clone?

    This is another benefit to Apple: by carefully thinking out in advance what the platform would be and how they’d roll it out to customers, they are being pro-active, while everyone else is being reactive. The Palm Pre is clearly reactive: instead of asking what users needed and how Palm could meet that long term, they’re trying to turn out a clone device. Oh, and they’ll have an on-line store too. Likewise, Microsoft is completely reactive and up to their usual tricks of promising vaporware. If Apple can shake RIM and cause the latter to lose focus on their own platform, they’ll not have any meaningful competition for years.

  • http://www.cyclelogicpress.com Partners in Grime

    Another terrific article. Looks like great things ahead for the iPhone platform.

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  • seanw

    netbook, shmetbook.

    looks like apple just entered that nascent market.

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  • enzos

    Elegant prose, Steve W.; sure you’re not really Dan’s alter ego? Yeah, I too like where things are going. (Fingers crossed that Steve J. gets well and prospers for another decade at least!)

  • http://www.isights.org/ whmlco

    @GwMac: I think you’re forgetting the 30-million plus iPod Touch’s Apple has sold, most likely to that non-AT&T audience.

  • http://coderad.net StrictNon-Conformist

    whmlco: it’d be nice to think (as a developer for the platform) that Apple had already sold that many 30-million plus iPod Touch’s, but in their 3.0 presentation, the total of iPhones and iPod Touch’s was announced at 30 million. However, it is just a matter of time ;)

  • http://www.isights.org/ whmlco

    @StrictNon-Conformist: My bad. Right, the total was 30 million, which means that Apple has only sold 13 million Touches. Or not quite 30% of Sprints entire customer base.

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