Readying for Apples iPhone

You may have heard that the iPhone is set to arrive this week. The sleek little $500 device will be available June 29 and is getting its close-up in Time magazine, Newsweek and the Wall Street Journal, while generating a bevy of press relations announcements from partner vendors and starring in a series of demo ads on seemingly every network.

The online gambling site BetUS.com is even taking bets on whether the first generation will crack like the first iPod Nano (odds: 150:1) or generate consumer trampling at retail stores (odds: 20:1).

AT&T Inc., the lucky service provider to have initial exclusive distribution rights with the phone er, device says it has more than 1 million people have inquired about the iPhone, 40 percent of which are not existing subscribers. Thats good news for the company. Even so, concerns abound as to whether Apple and AT&T will hit their goal of selling 10 million units in the first year, or whether the iPhone will bring the device sea change its been forecast to bring.

The stars certainly seem aligned. AT&T released more service details this week, showing the phone to be affordable on a monthly basis, at least. There will be three new service plans available just for the iPhone, all of which include unlimited data, Visual Voicemail (which allows consumers to see a listing of their voice mails, decide which to listen to, then go directly to those messages), 200 SMS text messages, rollover minutes and unlimited mobile-to-mobile calling. Individual plans are priced at $59.99 for 450 minutes, $79.99 for 900 minutes and $99.99 for 1,350 minutes, based on a two-year service contract, plus a one-time activation fee of $36. iPhone customers also can opt to go with any of AT&T’s other standard service plans.

The nervous twitters begin when the iPhones list price is brought up. It will be available in a 4GB model for $499 and an 8GB model for $599.

“The underlying drivers for converging music, multimedia and communications capabilities in a device such as an iPhone are certainly prevalent in today’s market,” said Kurt Scherf, vice president and principal analyst with Parks Associates. “However, the high price point may prevent the iPhone from achieving greater adoption over the short term. It may be an early-adopter product that appeals to technophiles but initially leaves other interested users on the outside looking in.”

In a survey, Parks Associates found only 3 percent of people were chomping at the bit for the iPhone.

Meanwhile, IDC found in a survey that nearly 60 percent of a sample of 456 individuals were unlikely to buy one anytime soon owing to the cost of the device and the potential cost of switching carriers.

While the allure of owning the next ‘cool’ device will undoubtedly have early adopters and die-hard Apple fans queuing up to get the iPhone regardless of the price, the associated costs of ownership will persuade many others into a ‘wait and see’ position,” said Shiv Bakhshi, Ph.D., director of mobility research at IDC.

Yes, but what do you get for 500 bucks? To start, it combines full iPod functionality with wireless access (Bluetooth, Wi-Fi and GSM/EDGE cellular) and smartphone features. It has a QWERTY keyboard and can sync with Mac or PC programs. It also adds a 2-megapixel camera and the user-friendly Mac OS X to the mix.

And it has the well-publicized, and very pretty, 3.5- inch touchtone screen, which many are heralding as the death knell for button interfaces. iPhones built-in accelerometer detects when the user has rotated the device from portrait to landscape, then automatically changes the contents of the display accordingly, with users immediately seeing the entire width of a Web page, or a photo in its proper landscape aspect ratio. You can touch to zoom in on a Web page, which means an end to the anemic mobile Web experiences weve had to date.

Also, iPhone users will be able to activate their new iPhones using Apple’s iTunes software running on a PC or MAC in their home or office. Once the iPhone is activated, users can sync all of their phone numbers and other contact information, calendars, e-mail accounts, Web browser bookmarks, music, photos, podcasts, TV shows and movies, much like iPods sync with iTunes.

It is, however, lacking GPS capability for location-based services and has no expandable memory.

Is it too expensive? Will it play for businesspeople? Do we know how it will sync up with business-critical e-mail and collaboration programs? Will the Mac OS rally third-party developers despite having only one device to write to?

These are the unknowns, and the questions the industry will try to answer in the coming months.

Everyone from iPhone provisioning platform provider Synchronoss Inc. to mobile media middleware makers to the Wi-Fi Alliance are out offering their individual takes on the iPhone. It remains to be seen if the iPhone tide is enough of a rising one to lift all boats, but it clearly is the biggest wireless news of the summer.

Apple Inc. www.apple.com
AT&T Inc. www.att.com