close this window
Why the iPhone Won
New research suggests that the iPhone’s success is largely due to its ability to offer what other smart phones did not: Browsing was the killer app.
It’s official: Apple is the new ruler of the technology world. Today the company beat out Microsoft for the title of world’s most valuable — based on the value of all its stock — technology company.
The announcement isn’t surprising, given the public’s seemingly insatiable appetite for everything Apple, including news, in recent months.
When Gizmodo acquired a prototype of the iPhone 4GS after Apple employee Gray Powell (now infamously) left it at a bar, people paid attention. The product leak article has, as of this writing, garnered almost 11 million views, and it got the attention of everyone from the police to the blogging community to Jon Stewart, who coined the term “appholes” to describe the company’s reaction to the episode.
It’s difficult to imagine that the misplacement of an average cell phone — prototype or not — would warrant a media frenzy. But then the iPhone is hardly an average cell phone.
When Steve Jobs announced that Apple would enter the mobile phone business at the MacWorld Conference and Expo in January 2007, he declared that “every once in a while a revolutionary product comes along that changes everything.”
The iPhone is, clearly, one such product. When the phones went on sale that June, hundreds of people camped out to purchase them. Apple hit the 4-million-sold mark within six and a half months and reached 13.7 million by the end of 2008. By April 2010, the company had sold 50 million.
On May 7, The technology market intelligence firm IDC reported that while Nokia maintained first place in global smart-phone sales with 39.3 percent of the world market in the first quarter of 2010, Apple gained on No. 2 Research in Motion (best known for the Blackberry). Research in Motion claimed 19.4 percent of the market share (down from 20.9 percent last year), and Apple took 16.1 percent, a huge gain compared to its 10.9 percent share last year.
Even though the iPhone isn’t leading, it’s hard to argue against its success — it is, after all, a single product with serious name recognition, compared to Nokia’s numerous, faceless phones.
What is it about the iPhone that so revolutionized the smart-phone market? Not the App Store, which didn’t open until July 2008, fully a year after the first generation iPhone came out. At the time, the store boasted about 500 apps; today, it has 204,304, according to 148apps.biz, a website that tracks the number daily.
Researchers Joel West and Michael Mace believe the iPhone was successful because it was the first phone to offer the “real Internet” experience. (And of course Apple’s cultlike following also likely played a role in the product’s success.)
West, a professor in the department of organization and management at San Jose State University, has Apple roots — he was a columnist for MacTutor (now MacTech) and MacWeek, and founded the MacStats website. He now works as a software company strategy consultant, but is the former president and co-founder of Macintosh company Palomar Software, Inc. Mace has worked for both Apple and Palm, and is now a principal for Rubicon Consulting, a strategy and marketing consultancy for tech companies.
Their recent paper in Telecommunications Policy, “Browsing as the killer app: Explaining the rapid success of Apple’s iPhone,” argues that the Apple approach to the mobile Internet is what has made its phone so popular. While other companies were busy trying to create a new, cell phone-appropriate Internet, Apple decided to re-create the cell phone instead.
“By emphasizing the Web browsing user experience,” assert the researchers, “the iPhone leveraged the same value network of an estimated 1 trillion non-commercial, ad-supported and fee-supported Web pages that were already familiar to existing users of the wired Internet.” As West explains, Apple avoided the chicken-and-egg problem of attracting complements by making its phone a complement to the World Wide Web.
The iPhone was different from other cell phones in several key ways: Instead of a keypad, it used a touch screen; it didn’t have a user-changeable memory card or battery; it offered the biggest screen of any phone model, and it included a version of Apple’s Web browser, Safari.
Apple’s business model was also unique. The company negotiated a multi-year exclusive agreement with Cingular (now AT&T) in the U.S. and required all iPhone users to purchase a two-year service contract with mobile-data service. This mobile data service (currently priced at $30/month) is required for every phone, which guarantees revenue for AT&T. (Keep in mind that iPhone users have to pay an additional monthly charge for air time and text messages — even with a minimal plan (450 anytime minutes and 200 text messages), a monthly iPhone bill is $75 pre-tax.)
The required data plan has had a profound effect on consumers: It promotes casual browsing. Whereas other mobile Internet users with limited data plans have to pay attention to their online time, iPhone users have the pre-paid Internet at their fingertips, whenever they want it. When they want to look up a restaurant, find a statistic or check their Facebook messages, they don’t need to find a computer — they just pull out their iPhones.
Apple made sure that even people who couldn’t afford the monthly expense of their phone could get hooked on their platform. The iPod Touch, a sort of “iPhone lite,” is an mp3 player that is visually indistinguishable from the phone, although it can’t make calls and can only connect to the Internet through a wireless network. Although it was initially more expensive than the iPhone, it has become almost as popular (likely due to some extent to Apple’s promotional giveaway of the product with laptop purchases).
West wrote last year on his blog that if the iPhone is heavily used for the same thing as the so-called “wired” Internet (in other words, the computer Internet), it will start to become a substitute. And while the smart-phone market is evolving to reflect this new reality, the iPhone has shown that the catalyst for the widespread adoption of mobile data services wasn’t, as some experts predicted, mobile banking, commerce or mapping services (don’t worry, there are apps for that), but something far more simple.
“In the end,” write West and Mace, “The iPhone proved that for the U.S. (and perhaps Europe), the killer app for the mobile Internet was the same as for the wired Internet: a Web browser.”
word on the street
- Bob Wolfe
- http://mobithinking.com mobiThinking
- jeff
more in this section
Gender Wage Gap Skewed By Survey Flaws
‘Orcas as Slaves’ Argument Sinks
The Perceived Delicacy of the Female Conductor
Prop Planes: The Future of Eco-Friendly Aviation?
House Puts Transportation in Partisan Crossfire
A Perennial Epicenter, Now for Same-Sex Marriage
Prop 8 May Be Same-Sex Couples’ Least Worry
EarthScope: A Seismic Shift in Data Gathering
Pressure to Conform Can Inspire Creativity
Learning to Read When a School System Falters
also by this author
Elisabeth BestFormer Miller-McCune Fellow Elisabeth Best is currently pursuing a Masters of Pacific International Affairs at the University of California, San Diego...
Lessons From China and India’s Newspaper BoomHow the print media in China and India are succeeding — and what America’s ailing journalism industry might learn from them.
Making Seed Aid BlossomThe quake in Haiti and floods in Pakistan highlight that the multimillion-dollar emergency seed aid industry is in need of a makeover.
When Migrant Workers Return HomeThousands of Latin-American migrants come to work in the United States every year, legally and illegally. But does their time in the U.S. help or hurt them when they return to their home countries?
Public Schools: An Untapped Recreational ResourceResearchers suggest limiting liability issues to make playgrounds and other recreation areas on school grounds accessible as a cost-effective way to promote public health.
Recreating the Creative Industry in New OrleansIn the wake of Hurricane Katrina, New Orleans has been rebounding slowly. Five years after the disaster, researchers suggest that the city promote its entertainment industry as a development strategy.
Receive 1 year (6 issues) of our print magazine for just $14.95. Miller-McCune features polished, in-depth reports on research and solutions across the policy spectrum — from health care, education and energy to international affairs, poverty and the global economy. It's a must read for well-informed and solutions-driven individuals.
follow us on:
join our newsletter:
from the source
A lot of people say they watch the Super Bowl mostly for the ads. But it turns out a good game surrounding those ads makes them seem better.
After decades of obstacles hindering the voting process, new laws will allow overseas and military voters to submit their votes in time for the 2012 election.
World health leaders announce coordinated push to eradicate or control neglected tropical diseases.
A survey of award-winning children’s picture books from 1938 to 2008 suggests our increasing estrangement from the natural environment.
Rather than moaning about too many cars on the road, the Ridesharing Institute says the real key to battling traffic congestion and pollution is filling empty passenger seats.
