How Steve Jobs duped the world into thinking that the new iPhone is cheaper

10 06 2008

Okay so the title might be a tad dramatic but after reading on how much the new iPhone actually costs, I couldn’t hold myself back.  After hearing Jobs keynote yesterday where the audience practically treated the event like a rock concert, I was shocked by the price reduction of $200.  The new iPhone 3G will cost $199 which is significantly cheaper than the previous model.

What Apple doesn’t tell you, however, is the added costs that come right after you sign up for a contract.  For an average user, here is the extra features they will have to pay for:

  • 3G network – $30 (previously, an iPhone user paid $20 for an EDGE data plan)
  • 200 Text Messages – $5 (previously an iPhone user got it for free)
  • Mobile Me Push/Sync program – $8/month ($100 / year) – if you want to sync your mail with MSFT Exchange/Outlook – you need this program

When it’s all said and done, you’ll need to pay $43 on top of your AT&T minute plan to take full advantage of your iPhone 3G.  Well lets quickly do the math.  For the $200 you are “saving” from buying the new iPhone, you’re actually going to be paying that amount back to AT&T in about 9-10 months.   Now that AT&T requires you to lock into a 2 year contract, you’re basically going to pay $1000 for a new iPhone during your next two years when you add it to your minutes.

It’s a genius move by Apple on making the device significantly cheaper but its a model that is used by most smartphones.  There is a reason why AT&T advertises Blackberry Curves for $99 these days.  They make money on the variable cost, not just the fixed cost.

That being said, I think the average consumer will be drawn to the beautiful devices sitting in the shopping malls fully functional.  Once they go through the first sign up flow and look at their first AT&T bill after the first month, they may sing a different tune.

I think I might look at this picture in a different way now….

Just my $.02…

-SD

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The next step in the iPod product line

12 09 2007

With all of the hoopla with the changes in the iPod line, I figured we could begin to go one step further to predict the next line…..

Behold:

Quick $.02…

-SD





Say hello to the new iPod

5 09 2007

UPDATED: I wrote this while Steve Jobs was still announcing his product line.  Latest news: iPhone Price cut – $399 for an 8GB.  I think they’ll be getting rid of the 4GB model now.  $200 price cut within 2 months of the release….is someone a little tense about selling a million units by the end of Q3?

UPDATED: I’m going to update this post but I wanted to quickly put down what came out @ Apple today. For those of you that didn’t want to shell out $500 for a cool iPhone, you can now get essentially the same hardware without the phone for $200 less. This by the way, is absolutely genius. Jobs makes sure to rope people in with the unveiling of the iPhone and gains consumer interest. He sets a price point high enough so that pioneers will buy it but normal folks will be intrigued. Finally – he unveils a similar hardware product that gives people the choice to choose between phone and mp3 player. Not to mention, he makes sure that the price is consistent what it always has been.

I think the reason why the iPod is so successful is because there has been no change in pricing since its unveiling. As a result, when new updates come about, users get very excited because of the new technology it integrates. The iPod went from black and white, to color, to enabling photos, to enabling videos, and now, to enable YouTube.

The other thing that was announced today was the Apple ITunes WiFi. Essentially with this product, you’ll be able to download/purchase songs from the music store straight onto your iPod (look out Zune). They’ve also partnered with Starbucks so that you can go into a Starbucks store and use their wireless for free to download songs. This allows starbucks to get incremental users to their homepage to drive traffic, and allows iTunes to create effective partnerships.

The new iPod is called the iPod Touch

Here are the price points for the new items:

 

 

Gizmodo.com photos

As the rumors were true, the iPod Nano came out today as well….the fat nano.

Not too shabby….too bad the stock is taking a beating…I guess everyone expected it…

Just my $.02..

-SD





GPhone vs. iPhone?

24 08 2007

A lot of this post will be based on a rumor proliferated by rediff news, a popular Indian news source, which claimed that Google will be releasing the new GPhone in 2 weeks.  They even provided a picture to go along with their claim which shows that Google has taken an iPhone approach in their user interface.

Now we have to ask the question who would realistically win in a battle of the GPhone versus the iPhone.  Granted the iPhone has already gotten a headstart and there has been no confirmation that Google is even coming out with a phone, although numerous sources indicate that Google has hired a plethora of people to work on this “secret” project.  But what’s with all the secrecy.  Steve Jobs was secret about the iPhone until his keynote when he indicated that it won’t be available for another 6 months or so.  As a result, it garnered a ton of people getting interest, companies began to develop apps, and the rest was history.

I had a chance to open an iPhone yesterday and sync it up and I must say, I was thoroughly impressed.  Apple and AT&T created such an amazing integration with the product, that you may begin to believe that cellular technology in America is actually getting pretty good.  Here are some of the key highlights:

  • Uses iTunes as a platform –  Apple was extremely smart in sticking to their core products.  They know that they have a ton of people using iTunes both on Windows/Mac consequently resulting in placing the entire integration on that platform.  I.E. you plug in your iPhone and activate your SIM card, sign up for a data plan, all on iTunes
  • SIM Cards come preinstalled – This was an interesting move in that they simply disable your current SIM card and start from scratch.  It solves any integration issues with new technology – i.e. if you had a razr 2G sim card and then transfer to a 3G phone.  A bit more expensive for AT&T but with the iPhone’s margin’s and royalty fees, I’m sure it’s not a big issue
  • Activation takes 3 minutes – Speed with activation is key.  One of the things I hate about lithium battery’s is that you have to charge it – you can’t use it out of the box.  The iPhone comes charged well with everything at your fingertips

So how can the GPhone compete?  What does Google have in it’s arsenal that makes it superior to the iPhone.  Well, if Google can come up with an OS is as visually appealing, easy to use, and cheaper it would be a better product.  Additionally, if it can utilize its user base with Gtalk, Gmail and finally get some traction on their office suite products, the GPhone could be ideal.  But the biggest factor would be if it can be compatible with any carrier.  The iPhone was revolutionary as a device, not as a phone in my opinion.  It did not change the way we use our phone or change the way America used cell phones.  If the GPhone can change the way cell phone technology works/handled, I can see this thing really taking off….

Even though this is for Microsoft…I thought this was funny:

Just my $.02…

-SD





The start of a revolution

12 01 2007

Before I begin this post, I apologize for being unable to blog as frequently as I should. I know I’ve said it before, but I was really waiting for some sort of ground breaking technology to shake up the industry to come out of hibernation. The tech guns have made some noteworthy news during the holiday season (especially in the realm of video game consoles) but nothing like the announcement made by Apple today. So without further adieu, let me break down simply why today will be remembered for years to come.

The iPhone

The idea of an all in one device has been tossed around by companies for years. RIM’s Blackberry, Palm’s Treo, Motorola’s Q, and Samsung’s blackjack all have taken steps to create a device that can replace multiple gadgets in your pocket. Most analysts discounted the thought of being able to create a single device for the consumer because no company does each facet of the technology properly.

That being said, Apple has come to blow away the competition with the all in one device that can truly do it all. Why is it superior to every other brand that I had mentioned above? Apple succeeds because:

  • It has the brand recognition with the iPod to associate media music with phone capabilities
  • It developed relationships with cingular early on (with the Motorola Rokr/SLVR) because they knew it was in the future. Jobs looks like a genius right now because of the 100 song cap placed on all motorola phones.
  • It has the software set up to easily sync up with the computer and manage all of your contacts and music into a single transfer

Let me show you some pictures so that you can get a better idea of why this phone is different than any other:

 More to come later….

 

Just my $.02

 

–SD





Coming soon in technology…from the big guns

31 07 2006

I figure it’s about time to do some tech previews of the biggest and best tech companies out there. Earnings were announced and some where happy while others were very sad. This means, however, that the road ahead is extremely important. The back to school season and the holiday season are probably the two greatest times for consumer electronics and you know that after all of the competition this year, each company is going to put their best products out there. So let’s begin.

Microsoft

We all know by know that they have this product named Zune. I had blogged very early on that there were rumors that an iPod “killer” was on its way but it was simply that – a rumor. Steve Ballmer of Microsoft confirmed last week that the Microsoft product Zune is very real and is going to be a huge product in the market. A picture of this is shown below:

Here is my take on the Zune product. I think it’s going to be very difficult for Microsoft to initially gain a lot of traction in the market. I think the pricing that they set this at will really determine how many people will gain attention. Even the iPod took a long time to gain attention among the young demographic. I remember when I first got my iPod in June of 2003, I had to explain to people back then what an iPod does. Here are some other issues that the Zune player can face:

  • With so much traction in the market, Apple users are generally tentative to move not only to a different mp3 player, but also a different software. It is because of iTunes that the iPod has been so successful and transferring those songs to WMA format will be painstaking and time consuming
  • WiFi and mp3 enough of a value proposition? Without full scale wireless access, ultimately it can be a bit useless. I guarantee you that 2 iPod generations from now we will see a wifi ipod
  • There will always be competition in the marketplace – the key is how the dominant player will react. If Apple plays its cards right, we should see this just like Apple is in the PC market….ironic isnt it..

Expected Date: November 14th (according to MSFT sources)
Apple

Since we’re talking about Apple – we might as well see what’s on their roadmap. Apple usually comes out around this time (right before people begin to purchase their back to school accessories) and announces a huge new product. Last year it was the iPod Nano, two years ago it was the announcement of the click-wheel..etc…etc. So what about this year? What does Steve Jobs have up his sleeve? Well initial reports indicate that we’re going to see either one of two things. An advancement of the iPod nano (which wouldn’t be that cool), or an iPhone. The photos circulating around the internet are all fake and design oriented, but the idea is pretty close. I wonder if they are going to team up with Motorola at some point since they did with the SLVR and ROKR phones.

I doubt the iPhone will actually look like this but it seems like it would logically be a slider phone. The problem with phones, however, are that Apple right now is probably cutting some deal with a phone provider (Cingular most likely) to put it on the market. This means that you would have to purchase a phone plan in order to buy the phone which would make it difficult to sell at the Apple stores. Additionally, I must say that this will probably be a GSM phone (obv) but the slider functionality (which would make the most sense) would be interesting. Hopefully they announce it soon…

Expected date: Before School Starts (Late August – Early September)

Google

Honestly, these guys announce something new almost every week that it is really tough to figure out what they are going to do next. This summer we saw some very large products get launched and some more which are slated to be released soon. As the summer started, we saw Google Spreadsheets launch to a moderate audience (still in Beta). After that, Google Checkout launched and was coined as the “PayPal killer” which obviously didn’t happen. Just last week they launched google traffic which gives you real time updates of traffic which can be accessed through your phones as well (really cool btw – best google product I’ve seen yet). I really think that Google has become extremely dominant in one thing. Releasing a product frequently, getting relative traction in the market, and then ultimately finding it’s niche in the middle of the market. With the exception of search and arguably maps, google product have done okay. Gtalk was recently said to have 44,000 users….versus AIM which has over like 300,000.

So what’s next? Well today, they began to offer Google Writely, a word processing software which is able to be modified online and saved online. You can sign up for an account now…*I already did*

Expected Date: Google Writely in beta now…like every other one of their products..


Conclusions

There are a lot of cool products coming out and I’ll be blogging soon about some of the other companies and their roadmaps, including eBay, Yahoo and YouTube…

Just my $.02

–SD

Dell blowup count: 3 to date