Form over function

The sight of sneaker-wearing Apple CEO Steve Jobs clutching the company’s latest baby and preaching to the converted at this week’s MacWorld Convention in San Francisco was enough to confound even the most ardent technophobe.

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By  Aaron Greenwood Published  January 11, 2007

|~||~||~|The sight of sneaker-wearing Apple CEO Steve Jobs clutching the company’s latest baby and preaching to the converted at this week’s MacWorld Convention in San Francisco was enough to confound even the most ardent technophobe. The fact that Jobs was trumpeting Apple’s riskiest venture to date made for compelling viewing (albeit via the webcast!). Jobs did what he does best, whipping the sycophantic Apple faithful into a frenzy, turning his keynote into equal parts pantomime and self-indulgence, and giving the geek finger to convention, albeit in typically ‘aint it cool?’ Silicon Valley fashion. Jobs' belief in Apple’s newfound ability to conquer untapped markets at will no doubt derives from the success of the iPod, but the iPhone represents a very different beast to its less sophisticated rockin’ cousin. With the iPhone, Apple is attempting to change the rules of the game, but its bullish strategy for doing so even at this early stage appears to have its pitfalls. The handset’s limited hardcore capabilities (not a Microsoft Windows Mobile application rival in sight) will surely turn off corporate users, as will the hefty price of US$599 for the 8GB version. Certainly, the iPhone appears a triumph of form, but is this at the expense of function? Probably not, at least in the minds of those few on the planet who actually bother to watch full-length feature films on their Video iPods. But herein lies the problem. By ignoring the corporate market, by refusing to include a 3G capability, and by tying with single network operators, Apple has created a very exclusive and costly product with arguably limited mass appeal. So how will the iPhone fare in the Middle East come launch time in early-2008? No doubt it will prove a hit with the local Apple faithful, but these are few and far between compared to most other regions worldwide. Apple has consistently struggled to gain a foothold in the Middle East, and the iPhone appears an unlikely panacea to this problem. The company will also face huge challenges in replicating its international business model in local markets. The concept of subsidised handsets marketed in exclusive partnership with network operators has proven an abject failure in this region, which leaves Apple with the hard sell option of marketing unlocked handsets at full-price in limited numbers. Tying the iPhone to the iPod is a savvy marketing move on Apple’s part. Yet, while the iPod metaphorically changed the way the game was played, given the huge commercial challenges facing Apple in the handset market, it remains to be seen whether the iPhone even deserves a place in the first team. ||**||

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