The iPhone naysayers, one year later

Jake Widman — Thu, 10 Jul 2008 10:16:26 -0700

Remember the iPhone naysayers? The experts, observers and competitors who said Apple's mobile phone was too expensive, overhyped, or otherwise lacking?

Well, the Industry Standard went back to seven of the critics -- including John C. Dvorak, Dan Gillmor, and Steve Ballmer -- and asked them what they think now that the iPhone has proven itself a hit with consumers and turned the mobile world upside-down. Not everyone replied, but those who did offered some intriguing commentary about Apple, the iPhone and iPhone 3G, and competing devices from Nokia and Research in Motion. They also answered the pressing question of whether or not they've broken down and bought an iPhone for themselves.

Read on to see their original complaints about the iPhone, and what they have to say about the device now, more than one year after its remarkable debut.

Critic: Dan Gillmor, director of the Knight Center for Digital Media Entrepreneurship at Arizona State University's Walter Cronkite School of Journalism and Mass Communication. Gillmor is also director of the Center for Citizen Media. He has previously been a columnist for the San José Mercury News, a fellow at Harvard's Berkman Center for Internet & Society, and a pioneering blogger at SiliconValley.com.

What Gillmor said about the iPhone: Writing on his Center for Citizen Media blog at the time of the iPhone launch, he called the original iPhone a "beta product" that wasn't ready for prime time. "I’d advise anyone considering one of these devices in the U.S. to wait for the next version," he explained. "The initial product doesn’t come close to living up to the hype."

What Gillmor says now:

Industry Standard: Are you surprised at how well the iPhone has done?

Gillmor: No. It's just fine for some folks, and genuinely innovative in some important ways.

Industry Standard: What do you think are the main reasons for its success?

Gillmor: Hype for one, including the "I'm cool" factor, but the dazzle is based in significant part on the way it works. More than any other company in the field, Apple understands software, and the iPhone is definitely a breakthrough in that category for at least some uses.

Industry Standard: Have you broken down and gotten one yet?

Gillmor: Nope. I did buy an iPod Touch, however, which has become my portable music/video device of choice.

Industry Standard: Is there a device you use to do what the iPhone does instead?

Gillmor: No other device does exactly what the iPhone does. Conversely, the iPhone doesn't come close to matching the most valuable features of the devices I do use, namely the Blackberry Curve and Nokia N95. The Blackberry uses T-Mobile's UMA [Unlicensed Mobile Access] technology, so I can make VoIP calls, and its physical keyboard make it excellent for e-mail (the iPhone's keypad is nearly useless for me.) And the N95 has a great camera, also does VoIP, and I can use it as a modem with my laptop.

Industry Standard: Is there a device on the horizon that you think could, or should, be an iPhone killer?

Gillmor: No, but Apple has some distance to go to make the iPhone a Blackberry killer or a N95 killer. Naturally, I keep hoping for a Miracle Device that will do everything, so I will continue to be disappointed . . .

Industry Standard: Do you think it will be considered as much a success this time next year as it is now?

Gillmor: Depends on what's in iPhone 2.0 . . .

Critic: Tim Wu, a Columbia Law School professor specializing in copyright and telecommunications issues. Wu is also a commentator for Slate magazine.

What Wu said about the iPhone: In a column on Slate entitled "iPhony: Why Apple's new cell phone isn't really revolutionary," Wu wrote, "The iPhone's style and user interface are pathbreaking, and (as the iPod proved) aesthetics do matter. But the iPhone is -- so far -- not a product that will turn any industry inside out . . . Saying the iPhone is a pointless gadget is a bit too strong. But it isn't yet a revolutionary device."

What Wu says now:

Industry Standard: Are you surprised at how well the iPhone has done?

Wu: No, I'm not surprised -- it is a great phone.

Industry Standard: What do you think are the main reasons for its success?

Wu: The thing about the iPhone is that it is the first phone made by people who understand what a good user interface is. By comparison most other phones are intolerable.

Industry Standard: Looking back, is there a particular factor you hadn't considered that you now believe contributed to its success?

Wu: The fact that people were able to hack the iPhone so well certainly helped its sales overseas and, to a degree, here. I love the apps.

Industry Standard: Have you personally changed your mind about the iPhone? Have you reconsidered your original opinion?

Wu: I didn't say the iPhone wouldn't be successful, I said it wouldn't change industry structure. And it hasn't. The irony is that the iPhone is pushing the industry closer and closer to a duopoly with AT&T and Verizon basically running the cell industry.

Industry Standard: Have you broken down and gotten one yet?

Wu: I have had a hacked iPhone for a while, and I think it's great. I love fooling around with new apps as they become available; it reminds me of the best days of the Apple II.

But that's only on a hacked iPhone. I would not have gotten a normal one.

Industry Standard: Is there a device on the horizon that you think could, or should, be an iPhone killer?

Wu: The device that will in time kill the iPhone will be an even more open platform than the iPhone, in the sense that the IBM PC almost killed the Mac in the 1980s. That is Apple's blind spot.

Critic: Lucas Mearian, storage channel editor at Computerworld.

What Mearian said about the iPhone: In a blog post entitled "Why the iPhone is a rip-off," Mearian wrote, "The iPhone is cool technology -- you can't help but ogle the interface -- but like [the] PS3, you'd have to be out of your gourd to pay that kind of money for something that's basically whiz-bang with no more substance than other cheaper, comparable products."

What Mearian says now:

Industry Standard: Are you surprised at how well the iPhone has done?

Mearian: No. I think Apple is a remarkably innovative company and often leads the consumer technology market in either breaking new ground with user interfaces or mass marketing technology in a unique way.

Industry Standard: What do you think are the main reasons for its success?

Mearian: The iPhone had a fresh look and feel compared with just about any other mobile phone on the market at the time, and Apple's marketing team knew how to position it. The iPhone's incredibly easy-to-use touch screen and high resolution was unmatched at the time of its release. Apple's advertising around the iPhone is also down-to-earth, fresh and appeals to a wide base of users -- from high-schoolers to 40-somethings. This phone definitely penetrated the market far beyond the usual cadre of Apple devotees.

Industry Standard: Looking back, is there a particular factor you hadn't considered that you now believe contributed to its success?

Mearian: No. I knew this phone had a huge "bling" factor and that technology aficionados would be clamoring to get one.

Industry Standard: Have you personally changed your mind about the iPhone? In other words, have you reconsidered your opinion, or do you think the iPhone's success came in spite of the issues you saw? If so, what caused the change of heart?

Mearian: My main objection to the iPhone was the obvious price gouging by Apple when they first released it. When I said it was a rip-off, I was referring to the $500 price and not the quality or innovativeness of the product. There were 14 other phones on the market at the time with similar capabilities. Apple was making a 50 percent gross margin compared to the average 10 to 20 percent gross margin for other handsets. Last fall, Apple repented and reduced the price of the iPhone by $200 and offered early adopters a $100 rebate (still not enough in my opinion). But I would still not buy one. I like having a physical keypad for messaging.

Industry Standard: Is there a device you use to do what the iPhone does instead?

Mearian: The LG Voyager.

Industry Standard: Why do you like it better?

Mearian: While the touch screen interface isn't quite as smooth as the iPhone's, it more than makes up for that in price, functionality (a great physical keypad), and Verizon's service.

Industry Standard: Is there a device on the horizon that you think could, or should, be an iPhone killer?

Mearian: Though I'm not crazy about Cingular service, Samsung's Ultra Smart F700 appears to beat out the iPhone with a 3 megapixel camera, support for 3G, and, again, a Qwerty physical keyboard. And the touch screen interface, according to reviews, seems just as good as the iPhone's.

Industry Standard: Do you think the iPhone will be considered as much a success this time next year as it is now?

Mearian: If you mean do I think as many people buying it today will be buying it tomorrow, a lot will depend on whether Apple lowers the price again. If they don't, no. They can add features, but there will be too many handhelds out that have the same or better technology at a lower price point, and people tend to get savvy to that over time. If you mean will just as many people own an iPhone next year as today, yes. The AT&T service provider contract will still be in place.

Critic: Geoff Long, columnist for the telecommunications industry newsletter CommsDay, serving Australia and the Asia-Pacific region.

What Long said about the iPhone: In a column entitled "Why the iPhone will fail," Long wrote, "In a week or two the fuss will fade and people will start to realise an important point: it’s just a phone, and not a particularly 'smart' one at that. And then people will start to find flaws in it, because let’s face it, version 1.0 of anything is going to have flaws. . . . iPhone version 1.0, in my opinion, will be a flop."

What Long says now:

Industry Standard: Are you surprised at how well the iPhone has done?

Long: Yes, I thought it would have taken them longer to get it right. Obviously they had a great interface and product straight away.

Industry Standard: What do you think are the main reasons for its success?

Long: I think the reason is that they made hooking up to the 'Net an easy affair -- something the other vendors have been promising but never delivering.

Industry Standard: Have you personally changed your mind about the iPhone? In other words, have you reconsidered your opinion, or do you think the iPhone's success came in spite of the issues you saw? If so, what caused the change of heart?

Long: Yes and no. Actually, I stand by my original comments, which were that I thought it needed 3G, third-party apps, and multiple operators before it would take off in a major way -- three things that are now happening. So you could argue that I got it right. What I didn't expect was that Apple would blow away the others on the interface, and I tip my hat to them in this regard. But I did suggest that the first users might regret buying something that will be overpriced -- that has also come to pass given the projected prices for the 3G versions.

Industry Standard: Have you broken down and gotten one yet?

Long: I haven't gotten one, but they're not widely available in Asia/Australia unless you want to go the grey market route. From what I've seen of friends who bought grey market models, the interface is a killer.

Industry Standard: Is there a device you use to do what the iPhone does instead?

Long: Tried many and never been satisfied, including the likes of the N95 from Nokia. However, for e-mail you can't go past the Blackberry, which seems to give the same warm tingly feelings that the iPhone does.

Industry Standard: Is there a device on the horizon that you think could, or should, be an iPhone killer?

Long: Obviously everyone is waiting for the first Android devices, and I think these could match the iPhone, given Google's successes and credibility.

Industry Standard: Aside from 3G, what other major feature do you think Apple will introduce to the iPhone by the end of this year?

Long: No major new features, just more for less -- memory, storage, speed, et cetera, for less money.

Industry Standard: Do you think it will be considered as much a success this time next year as it is now?

Long: Absolutely, particularly if Nokia, Motorola and the gang don't come out with something as good, or if Google/Android is delayed.

Critic: Rob Enderle, president and principal analyst of the Enderle Group, an emerging-technology advisory firm.

What Enderle said about the iPhone: Interviewed for a June 2007 article on ABCNews.com entitled "iPhone Fever: Not Everyone Buys the Hype," Enderle pointed out several potential flaws. "The data experience is going to be very slow" and the device will not "match the experience shown on TV," Enderle said. He went on to criticize the glass and metal body of the iPhone, saying that dropping the device would ruin it. Enderle also worried that without a physical keyboard, teenagers who tried to drive and text on the touch screen might "end up in someone's trunk."

What Enderle says now:

Industry Standard: Are you surprised at how well the iPhone has done?

Enderle: Actually, a little bit, given how poorly it does e-mail and texting. They did have to reduce the price a hunk before it picked up steam.

Industry Standard: What do you think are the main reasons for its success?

Enderle: It is a very attractive phone, and it has the best browser of any phone in the market. In addition, the multi-touch capability is a crowd pleaser.

I still don't think it is a great phone, though, and without Apple marketing I doubt it would have done nearly as well. Apple could probably sell refrigerators to Eskimos.

Industry Standard: Looking back, is there a particular factor you hadn't considered that you now see contributed to its success?

Enderle: I really underestimated Apple's ability to contain the bad news. They truly contained the bad news and kept people excited through the initial problems. It has fundamentally changed the phone market.

Industry Standard: Have you personally changed your mind about the iPhone? In other words, have you reconsidered your opinion, or do you think the iPhone's success came in spite of the issues you saw?

Enderle: This was power marketing in action. Compared to a phone like the BlackBerry, the iPhone wasn't practical as a phone. The iPod Touch was actually a better overall solution if you wanted to just use most of the signature features (other than visual voicemail, which was much better than I thought it would be).

Industry Standard: Have you broken down and gotten one yet?

Enderle: No. I probably won't. I live on e-mail, and it doesn't do e-mail well (touch screen phones generally don't, but folks keep trying). I need a keyboard -- I came up on the BlackBerry and got hooked on the keyboard. Recently I started using the Celio Redfly and can almost live without a laptop. If the Redfly worked with the iPhone I might actually consider one, but it doesn't yet and it's not clear it ever can (the iPhone is not as advanced with Bluetooth).

Industry Standard: Is there a device you use to do what the iPhone does instead?

Enderle: Currently I'm using the HTC Advantage, which isn't a great solution, but I was trying to get a sense for just how big a phone could get and still work. I'm moving to the HTC Touch (Diamond) Pro next week. It should be much better for me.

Industry Standard: Why do you like it better?

Enderle: Keyboard and native Microsoft Exchange support. The second-generation iPhone fixes the Exchange problem, but I really need that keyboard.

Industry Standard: Is there a device on the horizon that you think could, or should, be an iPhone killer?

Enderle: The RIM Thunder looks interesting, but no one can match Apple in marketing, and beating the iPhone really will take some solid marketing. The second generation is much better on specs, and eventually Apple will launch an entire line, making a keyboard version likely. I think the new NVIDIA Tegra technology could create an iPhone killer in the second half of the year, though. The specs are so good they are hard to believe (130 hours of battery life AND 1080p graphics . . .).

Industry Standard: Aside from 3G, what other major feature do you think Apple will introduce to the iPhone by the end of this year?

Enderle: I expect a line of phones by year end, either one with a keyboard or a smaller iPhone Nano (maybe both). Apple has product lines with everything else they sell.

Industry Standard: Do you think it will be considered as much a success this time next year as it is now?

Enderle: The only thing that will kill this product is an Apple mistake (and they rarely make those) or if something happens to Steve Jobs. Microsoft [with its acquisition of Danger] and HP are making huge changes in how they approach this market, though. I'm convinced we are just short of a massive cycle much like we had with PCs, but this one will go much more quickly. While Microsoft should have the edge, right now I'm more impressed with what Google is doing. If Google executes on their full strategy (which goes way beyond phones), they could do to Apple what Microsoft did in the late 80s, and do serious damage to the rest of the phone market in the process. But that is a huge if.

Apple's other big problem is that the carriers don't like them, even the ones they signed up. If the carrier channel finds something even close to the iPhone, they could be screwed.

Critic: Steve Ballmer, Microsoft CEO

What Ballmer said about the iPhone: Ballmer scoffed at the iPhone in a January 2007 interview televised on CNBC. "Five hundred dollars? Fully subsidized, with a plan?" Ballmer said. "That is the most expensive phone in the world. And it doesn't appeal to business because it doesn't have a keyboard."

What Ballmer says now: Microsoft's PR firm declined to pass our questions to Ballmer. "Unfortunately, Steve is unable to participate in this interview request due to his busy calendar," a representative from Waggener Edstrom said.

Critic: John C. Dvorak, technology columnist for Dow-Jones Marketwatch.com and PC Magazine. Dvorak is also a panelist on the weekly podcast This Week in Tech.

What Dvorak said about the iPhone: Writing on Marketwatch.com in March 2007, Dvorak predicted failure. "There is no likelihood that Apple can be successful in a business this competitive," he said. "If it's smart it will call the iPhone a 'reference design' and pass it to some suckers to build with someone else's marketing budget. Then it can wash its hands of any marketplace failures."

What Dvorak says now: Did not reply to multiple e-mails.

Critic: Bill Ray, writer for the U.K. technology site The Register.

What Ray said about the iPhone: In 2006 article titled "Why the Apple phone will fail, and fail badly," Ray questioned Apple's feature set and price plan. "As customers start to realise that the competition offers better functionality at a lower price...sales will stagnate. After a year a new version will be launched, but it will lack the innovation of the first and quickly vanish," Ray said. "The only question remaining is if, when the iPod phone fails, it will take the iPod with it."

What Ray says now: Ray told the Standard that he was unable to reply, owing to the terms of his employment with the Register.

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