iYAP = i Yet Another Phone?

Being part of the i network, it's only reasonable that I comment on the latest iPhone from Apple. Obviously, I'm ready to "pull the trigger" on this bad-ass device. It combines Apple's great technology and usability wrapped nicely in a personal device. FINALLY! The three drawbacks as I see them: limited availability at release, new technology, switching costs.

1. Limited Availability
Cingular, Apple's exclusive partner in the iPhone deal, has approximately 58 million subscribers (#1 in the US with Verizon expected to take the #1 position in Q3 2007). Mr Jobs has suggested that they will go after just 1% of the approx. 1b cell phones purchased in the US for 2006. Thus, he's hoping that either, (a) 17% of existing Cingular customers will be buying the phone this June, or (b) there will be a shift in customer loyalty--the switchers (we'll cover this in a moment). It's most likely that there will be a little of both. This means that it will be difficult to get your grubby little hands on one of these. Not as bad as finding a Wii, but tough at first.

2. New Technology
First release products ALWAYS have bugs. Apple has great products, but they have issues with first release products just like everyone else. It would be a real bummer to serve as a "tester" when you purchase a $499 phone/ipod/internet device. Although, the "coolness factor" is certainly one big reason to forgo any minor inconveniences associated with your shiny new purchase. Imagine all the hot babes you will pull in when you whip it out. "Want me to call you from my phone? Ok. What's your number baby?" Boom!

3. Switching Costs
It's a real surprise that Cingular has an exclusive agreement...not! (that's for you Shane)

Some of my friends have told me they will gladly switch to Cingular, even sell their pet, just so they can own one of these iPhones. Trust me, I've thought about it. I want one! However, we're long-time Verizon customers who pay a little more for the Verizon service because we demand great service--which Verizon offers. How about Cingular? Could they provide the same service and coverage? I doubt it. What will the data packages cost to use the iPhone's fancy features? Wireless communications companies require low-churn rates and steady income streams to remain profitable. With the current average phone package price just under $50 per month we can be certain there will be a push to get that average UP UP UP with package add-ons. The US cellular industry is fairly saturated and it's consolidating (goodbye Sprint & T-mobile, it's been fun). I'd say that is where many of these switchers are going to come from.

If you've noticed, the iPhone requires a 2-year contract with Cingular. Who wants to switch to a 2-year contract with a company they have never used? Not I! Even for a phone that I would gladly sell my dog for...that is if I had a dog. There really needs to be a push toward the Cricket Wireless business model. Now that's something worth switching to. Ah, but it comes down to service.
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The iPhone is an interesting product. The best part is that it is perfect for a top secret project I'm working on right now. MMMWWWWAAAHHHHH

In the spirit of Steve Jobs, "boom!"