Saturday, February 19, 2011

Apple is the future iPhone carrier too

A lot has been made of the Apple business model for selling iPhones:
  • Sell it the the Carrier supporting the network that it will run on, for abou $600
  • The Carrier sells you the iPhone for $199 or less but with a 2 year contract adding up to $1500 or more
  • Let the Carrier charge you for Call minutes, SMS/MMS and Data all separately.
As a result the iPhone have been available upfront for a relatively cheap price but costing so much more at the end of your contract. This cannot last forever and I think Apple has a plan to dramatically decrease the cost of owning an iPhone over it's life time.

I have noticed several things over the years since the iPhone was introduced that made me realize the approach Apple could take.

The first one was a patent that was sublimed in 2006 but just recently granted to Apple. It detailed how an iPhone could make the different networks it can bid for the service on the device. This is done so by dynamically comparing the cost for calling each available network on it's location and choosing the one with the better offering. Apple detailes in the patent that all this will be transparent to the user. Needless to day even now, such un approach will be seen and almost imposible due to the level of cooperation Apple has to receive from the different networks to make this happen.

The second thing that cough my mind was the eagerness of adoption of iPhone/Apple relationship by the carriers internationally, even when they were multiple ones in the same country. So eager were they and so few iPhone could Apple produce initially that it was left with no choice but to establish exclusivity arrangements until it can cope up with demands by establishing factory and parts supplier relations. Apple did have a substantial power over exclusive relationships and in all cases that yielded some sort of innovative services to customers, like visual voicemail. But even when multiple carriers started selling the iPhone, it seams Apple was in no pressure to reduce prices but only to increase availability.

The third news that made its way quickly into the blogosphere was the rumor that Apple was planning to ditch the SIM card in future iPhones. This leak has obviously resulted from talks with the Carriers. Apple was trying to take control of them and at the time that must have caught a huge backlash and the next set of rumors was that Apple abandoned the idea...for now. The SIM card is the one piece if technology that it put into your phone by the carrier. You cannot use your GSM phone without it.

The forth piece of the puzzle came with the experience of using my iPhone for the past 4.5 years. I do not know how much exactly I have spend trough iTunes and its App Store but it was a great byung experience. I know I consciously made every purchase. This day iTunes has keeps a detailed record of everything I ever bough even allowing me to see only totals on a monthly basis. I do however trust the system and I would be happy if I can pay everything with my iTunes account and drop Paypal and the likes.

The fifth piece of news was just a few months ago and it was a segway to the patent awarded to apply in my first point. This is however called a Mobile Virtual Network Operator (MVNO, where a company buys call minutes from the big carriers in bulk and resells them to it customers. How many other companies are there with 100 million smartphone customers? Apple could easily become the biggest MVNO in the world since it's iPhone users generate so much data traffic by default.

The final piece has been there all along. Apple want to have a full control all aspects of buying, using and servicing your device so it can provide the best possible experience. Apple is all about creating the best products and services on the planet. They compete only with themselves and would not even give you a chance to ruin your experience, let alone the phone carriers. AT&T in the States has become infamous for its phone service and are by far the biggest and worst example.

So there you have it. One day 5 years from now, Apple would have been selling iPhones everywhere and have carrier partnerships with most if not all telecoms in the world. They will be buying minutes in bulk not just from one Carrier but from all and create a global pool of data traffic available to any celular equipped Apple device. Your future iPhone will not have a SIM card but will intelligently talk to Apple servers in the cloud. When you want to make a call or use data or send an SMS, the intelligent software will make a chice of network for you based on best reception only as all traffic will be data. Apple could provide you with plans or give you the option to pay as you go. There will be a standart fee per MB of data in the same way all apps cost the same throughout the world. iTunes will handle all payments. You will have one number on all your devices. That will be in your choice just like it is now for Facetime calls. Best of all, this will work anywhere on the planet.

How cool that will be.

Sunday, February 6, 2011

A call to revitalize the iPods

Apple has had a problem for some time. It showed on each quarterly results. It is the declining iPod sales. There is something in the iPod that decreases sales. So, lets speculate a bit about what it is an how to fix it.

I would immediately argue that this is the naming of the products; the much delayed acknowledgment that the iPod touch >> other iPods for more than a year. It has matured into its own device bursting with potential to be recognized by the company that made it.

I will come from a different angle. Ask someone what do they picture when they hear the work "iPhone"? It will likely be the iconic device having the familiar homescreen. Ask the same about the "iPad" and you will get a similar response. Now ask what they picture when they hear the word iPod? You will likely hear a few very different things. If you make a statistic of the response to "what is an iPod?" the dominant response will likely be a click wheel equipped device. Yet, last quarter sales-results have shown that over 50% of iPod sales belong to the iPod toch. This branding separation between what people think of an iPod is and what Apple sales as iPod has cost it a lot of sales.

I have tried to explain what the iPod Touch is to my dad so many times and he has an iPhone for more than 2 years now. Until he actually saw it himself he couldn't get a round the most popular explanation I tried: it's an iPhone without the phone part. And now we have an iPod Touch at home too - strike that - we have an old iPhone 2G on airplane mode masquerading as a iPod touch that my 3rd grade brother uses.

But lets look at the iPod lineup and see the overall cause of the confusion.

iPod shuffle - the smallest and simplest music player. No screen, just controls and a great clip. used exclusively for music but sometimes as a thumb drive too. Overshadowed by its iOS peers.
iPod nano - in it's current generation looks and is often used as a watch with ipod features. It uses muti-touch controls only and looks nothing like the original iPod nano. Almost as good a watch as the first iPhone was a phone. Watch this one!
iPod classic - a device soon to be retires due to Apple moving to mass usage of Flash memory and streaming cloud services as compared to hard disks and entirely local storage.
iPod touch - an iPhone looking iPod without the celular related hardware. Runs iOS just like the iPhone and the iPad. Used mainly for gaming and entreatment content. The Ace in the whole. Think iPad Nano potential.

It is clear how the iPod brand has diluted over several very different class of devices which have only the name prefix in common. In my option this has created user confusion and has hurt the sales of those devices. Apple should take a bold step and recognize them for what they are used for an market them accordingly.

I would like to mention the iPhone again. While the iPhone has turned out to be this great device with many more uses that a phone, people have long recognized it and bought it because they needed a phone. One of the very best thing Apple did was to get is the name "iPhone" from Cisco. How much easier it is for person to move from a device he calls calls a "Phone" to a device that is called "iPhone"? It's the easiest thing ever.

Apple has jus in the past year redefined another iconic type of product and got the same benefit from the name it chose. People have heard of tablets but they did not necessary understood them, mostly because the proponents and creators of tablets did not. People did knew what "pads" are. They use them on a daily basis. A "pad" is a small work plot. It could be for writing, cooking e.t.c. Well, there were of course all those embarrassing to talk uses but they were only familiar to part of the human population. And so Apple grabbed the general definition of a "pad" and made it into the "iPad" - an "intelligent pad".

I think in general people do not give the brand names Apple has created for iPhone & iPad enough credits for device's huge success.

Where is the iPod touch in all of this? How can the less than a year old and much more expensive iPad almost reach the sales of a 3-4 year product? Wasn't the iPad just a big iPod touch? Sales proved that is wasn't but then isn't the iPod touch like a small iPad? Yes, apps for the iPad are much more powerful but iPod is so much more affordable and mobile. So what's keeping this 3rd and most affordable iOS product from being a complete market dominator?

The "name" is the reason. Apple for a long time had difficulties in how to market the device. What has seamed to help is recognizing its main use as game and entertainment device and using that in its commercials. But Apple has been marketing the brand iPod for years and has worked hard to define a clear image of that the iPod is. Even the icon for the iPod on all iOS devices looks like a classic iPod Nano. The iPod touch is not your dad's iPod. It's a game console, it's a video player, its entertainment computer to-go and it should have its name changed...

To iPlay. Period

Even iTouch as many naturally refer to it would be better than iPod touch. Apple! It's not an just an widescreen iPod with touch controls. Get over it!

Its a similar train of thought that will leave us to recognize that the iPod nano name does not suit the product as well. Especially if Apple releases in september a new version optimized for the most iconic use for the Nano so far: a "Watch". Yes, Apple should rename it too...

To iWatch

Everybody knows what a watch is and making a product with iWatch brand will be an instant marketing success. Especially if Apple manages to pair it up with its own App store for little apps. There is just soo much useful inovation an iWatch can bring. Just think of the integration possibility of having your iWatch alert you about things that happen on your iPhone that is in your pocket. You no longer have to wander who calling. You can just check your iWatch and see their picture. I could go on. Apple, embrace that its about time you do an iOS watch.

Next is the iPod shuffle.
The shuffle is on the right track to becoming the definite iPod. It has adopted many new technologies that make the original iPod better at listening music. A clip, a headphone controls, voice controls, the shuffle function. This little music player has also remained true to the iPod. In its latest design, it has reintegrated the click wheel and boosted capacity to almost match the original iPod. There is no reason Apple cannot sell a 4GB shuffle. The iPod Shuffle is the iPod now. Yet, there is plenty of room for further enovation and device convergence. A NFC chip can also alert you about calls on your iPhone while you liten to music on the shuffle. I also think that Apple should integrate a retractable USB connector into the design of the shuffle, removing the need to get an extra cable. This will make the iPod a perfect replacement for a thumb drive and give you one more reason to have one. Apple cold even make a software to enable file storage with password protection.
Finally, Apple could make the end of the clip to key ring holder friendly and switch the orientation of the button in 90 deg counter clockwise. This modification will make the iPod the coolest key-holder enabling the clip to hold the keys hanging halfway in your pocket while the controls stay horizontal.

Ater all, its an iPod - an "intelligent Pod".

So after all said, here is how the next holiday iPod Product lineup could look like if Apple follows on my advice:

iPod - the previous shuffle, now with self contained USD cable and protected filestorage software. Clip enabled and optimized to hold your keys. Sound call notifications from your iPhone via NFC chip.
2GB - $49
8GB - $99*
*version with file storage software.
Perhaps they could give away those with a new Mac purchase instead of a thumb drive for OS reinstallation or they could sell its Mac OS X on iPods.

iWatch - the previous nano, now the coolest watch with OLED multitouch screen with apps and video notifications from your iPhone via Bluetooth pairing or NFC chip
4GB - $129
8GB - $149
16GB - $179

iPlay - the previous iPod touch, now in 5" (1024 x 768 pixels) version as well with iPad graphical power and GPS receiver, for a true challenge to the NGP by Sonny
8GB - 3.5" - $199
16GB - 5" - $299
64GB - 5" - $399

Apple, its your call.

P.S. I just have to find a way to make a 3D model of the new iPod idea. IMHO it's soo cool.

Saturday, February 5, 2011

The case for the 5" iPod Play

Why is the iPod Touch screen at 3.5"? Why isn't it bigger? Well, the
iPod Touch is the the iPhone without a Phone, right? It was made to
expands the ecosystem of devices and lower the cost of the iPhone
components. So why then is the iPhone screen at 3.5" size? Very
simple: because as a mobile phone it needs to be usable with 1
thumb only. Apple has likely found out that the 3.5" size is the
largest hand held display that most people can "walk around" the
corners with their thumbs.

But the iPod Touch is not a phone. Actually, most people use it as
media computer to-go and play with it with both hands. The iPod Touch needs
a Wi-Fi to be fully usable and Wi-Fis are sort of stationary. And so,
if you will be staying on one place, you can just as well afford to
use both your hands. The iPhone on the other hand has a mobile
connection and you can often find people using it one hand (or no hands) while going
somewhere with their other hand free to do other stuff.

If the iPod Touch is mostly used with two hands, why is it
phone sized?
Why indeed?

So how much bigger can it get without being an iPad?

Well the iPad has one drawback feature to to it. It's not pocketable.
And by pockets I mean those available on your jeans. We can therefore draw
the line between the iPod and the iPad at about 6" as such a device
will barely not fit into our pockets.

How big could the iPod get and how small can the iPad be made for
the two to be still distinct devices? Well, Apple likes to make
logical sense of things. I think they might have planned those two
devices sizes all along. What if the big iPod Touch is half the size
of an iPad and iPad Mini is twice the size of an iPhone?
So physical sizes could be:
- iPhone is 3.5"
- iPod Play is 4.85"
- iPad Mini is 7"
- iPad is 9.7"

What's also interesting is what the resulting screen resolutions could be:
- iPhone at 960x640*
- 5" iPod Play at 1024x768*
- 7" iPad 2 at 960x640
- 10" iPad 2 at 1024x768
* Retina Display

Since the iPod/iPhone are used much closer to the face a retina screen
will make sense in the 5" iPod Play too. Since it uses the iPad
resolution developers will not need to make new graphic, they could
just use the iPad ones.

The main idea of the 5" iPod Play is to have graphical performance of
the iPad but be at portable as the iPod Touch

The main idea of the 7" iPad would be to have a much lighter and
a cheaper iPad for reading.

Still, I think 7" iPad 2 will be a compromise size just as the 3.5"
iPod Touch is. The iPod is now more in a need to redefine itself and
starts living its own life again outside of the shadow of it's other
two iOS brethren.

On a final note, the iPod brand has become confusing. There are now 4 totally different iPods. Apple needs to leave only 1 iPod, separate and rebrand the iOS devices on their own and retire the ones that had their run. After all the iPod touch already makes more than 50% of the iPod sales, by the next iTunes Sept event it will be likely be even more.