So this is it, the iPhone 2

by Volker Weber

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It pretty much looks like the old iPhone. Two versions, 8 GB and 16 GB, the bigger one with a black or a white plastic back, the smaller one in black only. Instead of providing more memory, Apple cut the price substantially. $199 sounds a lot more affordable than the original iPhone which sold for $799 a year ago.

Three important hardware changes: 3G UMTS/HSDPA (850, 1900, 2100 MHz), an assisted GPS receiver, and finally a headphone jack that fits regular 3.5 mm plugs without an extra dongle. I want that.

What I will get, and everybody else who has a first generation iPhone, is the new software. Free of charge. It brings support for Exchange ActiveSync with push mail, calendar and address book sync, over the air. .Mac will be upgraded and rebranded as Mobile Me, giving you a similar experience without an Exchange server.

The software will receive lots of minor upgrades, and a huge one with the advent of the AppStore. And this will change everything we know about smartphones. It is going to spark an industry of small application developers who can make riches by creating small and inexpensive applications that people want. Apple is going to handle distribution for a 30% cut of the revenues, but they are going to pay this money from the first app sold.

The bad thing about this is, that the AppStore will basically be your only channel. If Apple does not like you, or if they want a bigger cut, or if customers don't like to deal with Apple, you are out of luck. Apple is going to set the rules, and they will be controlling the ecosystem. There are exceptions for Enterprise customers who want to distribute their in-house applications, and also an ad hoc distribution, but that does not change the fact that Apple will be the gatekeeper. And that means, you won't get your instant messaging applications if carriers fear for their SMS toll.

I expect to see lots of cool applications. And lots of free ones. You can get all this with a free software upgrade on July 11.

The message for IBM and IBM customers has also been very clear: Enterprise mail equals Exchange. Apple gets loads of ink, and to undo this message will be next to impossible. The iPhone enjoys a much higher user satisfaction than your platform. It's the better mousetrap.

Comments

I want one ... NOW!
And I will buy an "open" old one for a lot less than 100 Euros as replacement for my business phone. For my personal life I want the whole experience and therefor will jump into the T-trap.

Martin Hiegl, 2008-06-10 00:21

"And this will change everything we know about smartphones. It is going to spark an industry of small application developers who can make riches by creating small and inexpensive applications that people want."

You mean, like on PalmOS? ;-) SCNR.

Google is doing very similar and very interesting things with Android currently. And they already showcased a lot of those small apps. It will be interesting how both systems compete, Apple with its closed ecosystem and Google going the open source way. Though, I haven't seen any interesting devices announced for Android yet.

Oliver Regelmann, 2008-06-10 00:35

oliver you are right about android, but the thing that apple really is capable of, next to marketing is the really great UI and the way the phone feels. I have tried any single phone that tried or still tries to compete with the first iphone and none of them gets close in terms of that. and I am not sure that will change with android.
I was thinking about waiting on the first android models and all, but apple got me this time for sure... I'll be probably camping outside the tmobile store on the 10th. ah well... shit happens I guess :-)

people should know what they want from their phone and sometime you have to choose wrong :-)

well I am glad I did choose the e90 in the beginning, so I am ready for the iphone 3g now...

volker, how about you? 3g or are you keeping yours? or are you going for the stereo iphone sensation?

teymur madjderey, 2008-06-10 02:02

Too bad that the 2nd Gen iPhone is only available at Apple retail stores and via the mobile phone provider for your country. And you need to activate it with a bundled phone plan directly at their site.

So no more cheap online order via the apple online store if you plan to unlock/jailbreak the phone to avoid a new plan. Seems like Apple found a way to circumvent the masses of hacked phones that cut their revenues.

Sascha Reissner, 2008-06-10 05:49

You mean, like on PalmOS?

PalmOS never had a simple and unified distribution channel for small developers.

Volker Weber, 2008-06-10 07:52

One small point; because of how the currencies have swung since the original iPhone launch, the new iPhone will be a lot cheaper in Europe (my guess would be abound €140), than in the UK, where the original device at its full price sold very little - I'm guessing it will be not less than £130.

I have never seen a live iPhone in the UK, in either a personal, or corporate context, though I will say that most of my work is around Oxford, and further north into the UK midlands, rather than places like the City of London. Whereas I have seen plenty of the Nokia smartphones, and new Blackberries rolled out corporately.

My (perhaps very parochial) perception is that most UK companies and individuals just rejected the whole iPhone concept over the last year because of the price and narrow options of the earlier model, and have moved in other directions.

Even at around £130 - £140, the new version remains quite an expensive option for UK buyers, but on the basis of local response I have come across, it will make a bit of a change.

Nick Daisley, 2008-06-10 09:45

@Nick, the price will make a difference for sure.

However, a far greater issue for most companies is the lock in to O2 (the chosen exclusive carrier in the UK). Most companies have a set carrier they buy all their phones through, and just one device (even the iPhone) will not change that - the cost of the additional cross-network calls and the extra effort of managing multi-carrier contracts will be a big issue.

Also, O2 regularly has the worst custsat ratings of all the UK carriers, and their network coverage and pricing model also fall behind in most areas.

So, yes, I'd love an iPhone2, but would I throw away my company T-mobile plan for O2 -nope, sorry...

Stuart Mcintyre, 2008-06-10 09:57

@Stuart; I hear what you say.

The one time I had a proper across-the-table talk with a company director about their smartphone choice (which is not usually my bag anyway - I know very little about the technology!) it was the O2 issue that steered them away from iPhone.

My thought was that maybe a substantial price change might convince more individuals to buy a unit for themselves, and that they would start to infiltrate into corporate consciousness by that route. Mind you, we used to believe that about Groove... look what happened to that!

Nick Daisley, 2008-06-10 10:13

Having used three of the four main carriers in the UK, I wouldn’t have an objection to using an iPhone 3G with O2—they’ve been no worse than Orange (urgh) or Vodafone (my current provider) when I’ve been with them. The price point was the main thing that put me off iPhone originally.

The new price works for me, but I have 10 months of an 18 month contract left, so I guess I will have to pass again!

Ben Poole, 2008-06-10 11:48

With Ben - previously the price was a non starter. Mobile networks are by and large as good/bad as each other in the UK these days - with maybe some local differences on signal strength between them. So 02 not a big deal (although I wonder how the Euro authorities don't have an issue with this lockout of other carriers).

So I bet you will be able to pickup free iPhones on the new price for new/upgrade tariffs - big difference to before. That alone will change the market - I don't think I have seen an iPhone in serious use yet (maybe I should get out more).

Whilst they have put in the 3g technology now - the camera is still pointless at 2mp compared to the standard of 5mp for recent phones.

So for now stick with my Nokia N95 (euro phone of choice right now I believe) - I would love to swap - but then again an iPhone will probably make you a number 1 muggers target!


Steve Castledine, 2008-06-10 17:15

Well, I'm seriously considering the iPhone now, the price is much more sensible. The only fly in the ointment is that O2's 3G network in the UK is practically non-existent. At least I've never seen my phone pick 3G in London / South East. Munich: full bars. Dublin: patchy, but mostly available. London: nada.

Maybe it's my phone.

Kerr Rainey, 2008-06-10 18:41

That would be a big sticking point Kerr. My vodafone 3.5g seems to have good coverage apart from in the middle of the forest I stayed in last week - but that was a "good" thing :)

Steve Castledine, 2008-06-10 22:19

Well, here is the O2 contract pricing for the UK, for anyone who may be interested...

Nick Daisley, 2008-06-11 19:18

Na da bin ich ja mal gespannt wie es T-Mobile in Deutschland vermarkten wird. Man munkelt ja bereits, dass die ersten User ein Leckerchen bekommen werden und günstig ein neues bekommen sollen....

Tommy Igiel, 2008-06-11 23:29

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vowe.net is a personal website published by Volker Weber a.k.a. vowe. I am an author, consultant and systems architect based in Darmstadt, Germany.

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