Hello! And welcome to our Friday column, Worst of the Week. There’s a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!
And without further ado:
The financial world remains a mystery to me. Did Apple really have a “bad” quarter in which it posted only $8.8 billion in profits during a three-month period? This while Sprint Nextel had a “good” quarter in which it posted $681 million in net losses?
Crazy talk!
While I have given up trying to explain Sprint Nextel, it appears that maybe, just maybe, people are getting wise to Apple’s gambit of rolling out improved devices every 12 months or so. Just about every domestic carrier and analyst noted that customers pulled back on iPhone purchases during the second quarter, which most explained was due to all the hype surrounding the next iteration due later this year.
This is certainly not a new phenomenon, as historically iPhone sales taper off ahead of an expected updated launch. However, this year saw that taper much earlier than before. All of this despite the expanded presence of the device at more carriers, and even later in the quarter at carriers not requiring a contract.
There are tons of different reasons for this, including the overall economy forcing people to be a bit more frugal with their cash; the increased hype over the next iteration getting people all wound up; competitors having finally caught up and in some cases surpassed the iPhone in the minds of consumers; and my favorite, maybe the current iPhone 4S is just not really that sweet of a device. Sure, it’s an Apple product, so in the minds of most it’s more valuable than anything save for a limb, but it does seem that perhaps people have gotten wise to the fact that the latest iPhone was a half-heartened effort by the company.
My guess is that it’s a combination of those factors that have resulted in the iPhone not being quite the outlier in the space it once was. A quick look back at some iPhone history for perspective on the 4S:
2007: Apple blows the wireless industry out of the water with the first iPhone. Sure, it lacks access to 3G networks and battery life is nothing to write home about, but the device is light years ahead of what others are offering and the era of camping outside of Apple stores begins.
Initially launched at the $400 for the basic model with a two-year contract, Apple and AT&T Mobility get together a few months after launch and drop the pricing to $200, which would curse device makers and carriers with now having to cap smartphone pricing at that level. Few knew it, but this marks the beginning of the demise of RIM and Nokia as they had previously operated.
2008: Apple rights all wrongs with the original iPhone by launching the “3G” version that adds compatibility to AT&T Mobility’s 3G network. This of course results in the crashing of AT&T Mobility’s 3G network at the hands of those iPhone users, who then blame the carrier for not foreseeing their desire to now conduct their entire lives from a mobile device. Despite being on the market for a year, no competitor has any answer for the iPhone, though search giant Google would soon provide a suggestion.
2009: Perhaps resting on its laurels, Apple rolls out a slightly enhanced “3GS” model with some internal enhancements designed to speed up the device, but also highlights the aging chassis housing that increased speed. That design malaise is further highlighted by the launch of Palm’s Pre device earlier in the year that shows some styling pizzazz.
Perhaps the biggest advancement for Apple in the iPhone space was that it continued to offer the previous generation 3G device alongside the new model, but at a $100 price point. Cheapskates across the country cheer. Yay!
2010: Maybe sensing real competition for the first time from Google and its device partners, which continues, and Palm, which would quickly fizzle, Apple unveils the completely redesigned and glass-encased “4” model. Perplexing customers far and wide, the new device is not compatible with the latest generation networks that its name would seem to indicate, but that does not stop squatters from taking up residence on public sidewalks in front of Apple stores across the country.
While some competitors had indeed made great strides in the smartphone space, the 4 shows who the real boss is.
2011: After causing near pandemonium by delaying its usual 12-month renew cycle by a few extra months, Apple roles out its “4S” device to muted applause, followed by “we waited three extra months for this?!?”
Sure, the 4S model looked exactly like the 4 and for the most part performed exactly like the 4, save for that annoying Siri feature that despite what all those commercials want us to believe is something that will be used once, and only once.
The lack of the 4S was more evident as the market by that time had been flooded by other devices sporting faster processing doohickeys, larger screens and connections to faster networks.
The 4S is also the reason that Apple found itself in the position it was in this week.
Now, I am not saying the 4S will go down as the Pontiac Aztek of Apple products, or basically a real-life diorama as to why General Motors was forced into bankruptcy protection, but my guess is that there will unlikely be a 4S device fetching more than $20 on EBay 20 years from now.
Of course, with Apple still reporting more profits in a quarter than would be needed to buy any domestic wireless operator outside of the top two, all this doom-and-gloom surrounding Apple needs to be take in perspective. Apple is far from becoming the next RIM or Nokia, and next week we will take a look at just what Apple needs to do with its next iPhone to regain its mojo.
OK, enough of that.
Thanks for checking out this week’s Worst of the Week column. And now for some extras:
–Security solutions provider and newly nicknamed Buzz Killington, Venafi, released a report this week predicting that 67,000 mobile devices will be lost or stolen during the 2012 Summer Olympics. The report went on to cite the mega-zillions of bytes of data that will be compromised due to these events that we all know will likely happen, but at the same time would rather not talk about because they are sort of a downer.
Way to go Venafi, you just made watching synchronized swimming even that much less enjoyable.
–I know it’s not the sexiest phone and has virtually no shot of showing up on a reality TV show, save “Hillbilly Handfishin’,” but props to Kyocera and Boost Mobile for launching the Hydro device. What makes this “basic” phone prop-worthy? It can be submerged in three-feet of water for 30 minutes and still function like it was intended … as a phone.
I have no insight into how or why Kyocera came up with the three feet for 30 minutes submerged requirement, but I have a few ideas.
I welcome your comments. Please send me an email at dmeyer@rcrwireless.com.
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