Apple COO Says Free Mobiles Are Worthless - Oh Really?
Apple COO Timothy Cook is quoted as saying yeterday, at a conference in Las Vegas, that
A lot of people pay zero for the cellphone. Guess why. That’s what it’s worth…
Now, without having been there, it’s difficult to know if this quote is taken out of context. But, if we take it at face value, it would suggest that Apple senior management believe that phones that are available for free with contracts from mobile phone network operators aren’t worth the components they’re made from. And by inference, that people will much to prefer to pay $499 or $599 for their phone, than nothing at all.
Let’s compare value propositions. My free mobile phone can: access the Web; play music; send/recieve SMS/MMS messages; send/receive e-mail; take photos; and make phone calls…
All this is what the iPhone does. Of course my phone has a whole bunch of other features…
What are these? Well, the photos I take with my free mobile are probably better than the ones I’ll be able to take with the iPhone (my phone has autofocus, and LED flash). Additionally, my phone can record video. And critically, I can install 3rd party software (or even develop my own applications) that make the possibilities for what I can use my phone for almost limitless. This thirdy party software can: have 3-D graphics; access the Internet to take advantage of 3rd party services; provide much better web-browsing than the built-in browser provides; access the data stores on the phone (e.g. contacts) ; can communicate with computers and other mobile phones via Bluetooth; control playback of music and video; and much more…
And my mobile phone was not only free, it’s about two years old now! The phones you can get for free today do even more.
Now, we can argue about whether the iPhone is better than free mobile phones. However, given all the benefits I outlined above, I don’t think many will find it credible to suggest that free mobile phones are worthless when compared to iPhone.
I wonder if the Apple COO really suggest that. If he did, then Apple are in big trouble with their iPhone - if you don’t understand your competition in business, you’re dead…
[via Engadget]
Asam Bashir wrote:
Morgan Stanley don’t seem to agree with you,
http://www.macnn.com/articles/07/03/01/iphone.underestimated/
Posted 02 Mar 2007 at 2:38 pm ¶
simon wrote:
In what way? I think the iPhone can be a big success - it looks like it could be a great product (assuming it’s not riddled with bugs etc.)
I am, though, questioning the judgement of anyone that thinks that every phone that is free with a contract is a worthless device.
Posted 02 Mar 2007 at 3:29 pm ¶
Asam Bashir wrote:
Any talk coming out of Apple about the iPhone right now is just regarding the stage 1 roll out, June/Cingular, for this they’ll shift 10 million phones for the high price without a problem. Look back to the first generation iPod, that was very higly priced but it did it’s job of shifting mind-share and was a good start to the iPod phenomena. Once the ball starts rolling they’ll bring out cheaper versions. This is just typical Apple methodology when rolling out any new product. There will be a premium to pay if you want it first, but it’s wrong to judge long term success on just the entry product…
Posted 02 Mar 2007 at 3:53 pm ¶
That would be me wrote:
It seems like ridiculous exaggeration, on the other hand some phones are pretty bad, if not downright frustrating. For an Apple exec, if a phone is hard to use and tailored for twelve-year olds, like in this Guardian story, it’s ‘worthless’, so to speak, even if tons of features have been packed.
http://www.guardian.co.uk/commentisfree/story/0,,2026579,00.html
Posted 06 Mar 2007 at 9:17 am ¶
simon wrote:
Oh yes - lots of phones really are essentially worthless. No argument there.
It’s nothing to do with whether they’re free to end-users or not though; and everything to do with the fact that some manufacturers aren’t that great at hardware design, or software design, or both.
Posted 06 Mar 2007 at 9:25 am ¶
Asam Bashir wrote:
Oh ps, looks like European carrier is Vodaphone, thier execs seem to be publicy begging Apple to carry the iPhone
http://news.softpedia.com/news/Vodafone-Exec-on-iPhone-48545.shtml
Posted 06 Mar 2007 at 9:43 pm ¶