Exitlog | Leaving Impressions

The iPhone launches in the UK, a little dearer, and do we care…

Launched at a special media held the Apple Store, Regents Street, London Steve Jobs introduced the iPhone (available the 9th of November excluding on O2). Initial reaction to the announcement is a muffled cheer at best. We were a little less impressed.

Apple make cool products, as many creative agency, design and production studio will testify. But not every product can be a hit – the loved, but slightly lame, Newton, the (then) unbelievably small Power Mac G4 Cube, the current Apple TV and the original iPod shuffle (just to single a few out). While there is undoubtedly things to be excited about with the arrival of the iPhone, there are some considerations: price, connectivity and customer understanding.

In the UK the 8GB iPhone is priced at £269 including VAT. There is also an 18 month O2 contract (cheapest from £900) which adds to the overall price . This model is more expensive than in the US, £70 more expensive. Is this an equitable value? The quoted US Apple Store price does not include Sales Tax, which is generally cheaper by half than VAT. The extra £70 is down to the regional costs.

At the launch Apple claimed it was more expensive doing business in the UK (presumably as Adobe have said for years it is all due to the higher taxation and localisation costs associated with converting English to English). An American gadget tax? For us this is just unnecessary inflation.

What do punters get for the money then? For the money they get EDGE connectivity (2.5G). It is rumoured that a 3G iPhone is coming, but not until 2008. EDGE connections aren’t bad, but do have less coverage that 3G nationwide. Luckily the iPhone has built-in WiFi. The O2 contract includes free access to The Cloud’s some 7,500 WiFi hotspots; and connection is supposed to be seamless as it is covered as part of the tariff (no passwords or login keys).

Battery life is good and the interface is excellent (or brilliant compared to Nokia’s N95). Users get the complete iPod experience with music and videos; and it syncs, via iTunes, perfectly to their home computer. No other mobile phone offers the complete experience in the same way. The iPhone is also easy to use and great to look at. So, not bad features really.

But is the iPhone really that good, does it live up to the hype? Definitely maybe. The iPhone is a high-water mark for Apple design. As a phone it is something special, a challenge to the rest of the market. This is probably why Apple and O2 can get away with such a high price for poorer connectivity. Overall it is seems more of a status symbol than a product of real value.

“I think after this they are going to sell more touches – buy a touch for a year and then get the 3G iPhone on a cheaper plan”
a devoted fan

The iPhone will sell. It will sell loads. Still we feel the iPhone could have done better. Exclusively partnering with regional providers is a shrewd move. This is not the typical manufacturer to provider relationship. Apple earns on both the initial sale and future use of the phone.  And, O2 gets a mobile its rivals can’t easily compete with in terms of usability, desirability or even iPod-cool. Apple has gone for market share when it could have so easily gone for the whole market.

The UK market has 5 five major providers, and Virgin along with a few other virtual providers (if we’re counting). It is a very fluid and competitive mobile marketplace. Business tariffs equally competitive. There are a lot of businesses on better priced deals with existing providers. The O2 iPhone is unlikely to shift loyalties so easily. Your company Blackberry is not in any real danger yet.

Pay-As-You-Go (PAYG) customers won’t be impressed (or tempted). With six in ten mobile users in Europe opting for prepaid or PAYG services the iPhone, even as just status symbol, surely could have conquered. While there is a choice of O2 tariffs there is no room for PAYG.

Apple could have really made more out of this opportunity for a number of reasons. Mobile phone markets are more dynamic in Europe and an untethered iPhone would have been the mother of all successes. More providers, more tariffs and greater customer choice equals iPhones flying off the shelves.

iPhone? “No Deal”. Sorry Apple. The next generation of iPhone is probably the one to own; and it’ll no doubt be cheaper.

We have to agree with most of the forums and bloggers today, get an iPod touch instead and keep your mobile. You’re probably on a better tariff with your existing provider. And maybe, having more than one device isn’t such a bad thing. £269 will get you a 16GB iPod touch and no contract, that’s a deal.

Social networking the Presidency…

Yesterday Barack Obama, US Senator and Presidential Candidate, did something quite surprising to many, he asked a question on the popular business/social networking site Linked In: How can the next president better help small business and entrepreneurs thrive?

Many answered his question honestly, some with greater interest, others with some condemnation. And there have been numerous posts questioning the connection and LinkedIn’s implied support of Senator Barack Obama’s campaign. Ignoring the illegitimacy of the account’s identity, whether it is Mr Obama or some press aide, the decision to use the site as a forum for debate is an shrewd move.

Earlier this week I attended an event, The Impact of Socialised Media, and it was put to the audience that only 1% of users publish online in blogs and forums with any regularity. Another 9% do so from time to time while the remaining 90% are passive users, content to read, research, shop and be entertained. Conservatively this 10% of posts represent a lot of influence.

The forum answers run pages and pages (over 40 when last counted), with a great many of them thoughtful and considered. Whether these persuaders and opinionated users are convinced remains to be seen. Mr Obama does also have a campaign message on YouTube. Some how the quality of the responses there aren’t as high as those on LinkedIn.

Last year I suggested that online “opinions are manipulated at the speed of a mouse click.” The less cynical side would hope this represents the democratisation of the web (even if the phrase is a bit overused). All the same, PR has gone 2.0.

And, I was surprised to be just 3 connections away from Mr Obama. Hmmm…