A Little Brother for iPhone 5: Why Apple Might Do It

Rumors about the next iPhone have been circulating ever since the last one came out. There have been a lot, but besides the many supposed featuresit'll have, there's been some debate about whether it will be called iPhone 5 or iPhone 4S. Now the word on the street is that both are correct—that Apple will actually release two new iPhones in the fall, one being a completely redesigned model that will remain the flagship phone, and the other a cheaper, lower-end model that would be more like a cousin of the current iPhone 4.

The rumor is actually not much more than educated speculation from an industry analyst, Chris Whitmore of Deutsche Bank. That alone is enough to put the plan in the "questionable" bin. On top of that, though, such a move just seems out of character for Apple. Since its inception, the iPhone has always been "The iPhone." Apple's mobile product philosophy is pretty clearly a "one size fits all" strategy, releasing just one phone per year. Much like the tagline for the Highlander movies, for the iPhone, there can be only one.

iPhone Fragmentation

A split iPhone 5/4S launch shatters that apparent strategy. But, looking at the whole picture of Apple's recent actions, it does make some sense. While the standard case for a cheaper iPhone—that it would open the company up to new markets—has been true since the iPhone first debuted, it now matches with what Apple's been doing: getting serious about going global.

"It makes sense from the perspective of the iPhone trying to grab more market share in developing countries," says Harry Wang, a mobile analyst with Parks Associates. "So the price point becomes the focal point of differentiation."

Before the iPhone, Apple's global strategy wasn't as ambitious. If you look at world market share ofOS X vs. Windows for the past 10 years, Apple's numbers are, and have always been, pathetically low. But it's the "post-PC" world of smartphones and tablets that turned Apple into a $65 billion companywith greater market capitalization than Microsoft. Apple currently commands 18.2% of the world smartphone market, and it has successfully expanded its retail operation worldwide (the most successful Apple Stores in the world are said to be the ones in China).

"When the very first iPhone was introduced, I wrote that Apple would follow a similar product road map strategy with the Mac and iPod," says Charles Golvin, a mobile analyst at Forrester Research. "Where they maintained their pricing of their flagship device, and they would introduce new devices that allow them to expand their market share."

Owning the High End, but Little Else

It may not be as apparent to U.S. users whose handsets are massively subsidized, but the iPhone is an expensive phone. Earlier this year Nokia CEO Stephen Elop said, "Apple owns the high-end range"worldwide. He wasn't exaggerating; the price overseas for an unlocked 16GB iPhone 4 is in the neighborhood of $800. If you want an iPhone overseas, be prepared to spend.

But the mobile market is much more than just the high end. Cheaper phones on prepaid plans make up a good chunk of phone sales worldwide, and the iPhone, in its current form, isn't made for those markets. With the Apple vacuum, Google's Android has swept in with more affordable models all over the world. The price of the iPhone 4 in India if $765. Price of LG Optimus One: about $230. Even the higher-end LG Optimus 2X, the first dual-core phone on the market, costs less than the iPhone, at $600. Now you know why that used iPhone you sold on eBay went for so much.

"A midrange phone in the $300 to $500 range becomes a little bit affordable to middle-class people in developing countries," says Wang. "That would broaden the iPhone's market to a much bigger one and be more effective to fend of competition from Android phones."

Golvin agrees: "If you look at where smartphones have the most growth opportunity today, it's not in the well-heeled tech-enthusiast early-adopter market that led to the initial growth of smartphones. It's in a much more mainstream segment. To really appeal to that audience, they need a lower-priced device."

If Apple wants to stop Android from eating up an every-increasing slice of the global market, it needs to offer something to people who aren't able to spend almost $1,000 on a phone. "Hold on," you say. It already does—last year's model, the iPhone 3GS is a cheaper alternative (or as Wang calls it, the "default low-end phone for the Apple franchise"). Absolutely true, but there are two problems with having the previous generation fill the cheap-phone gap in Apple's product line: 1) It's not new. Convincing people to get excited about buying something that came out a year ago is nigh-impossible from a marketing perspective. Last year's model isn't something you want, it's something you settle for. And, 2) It's actually not that cheap, at least not internationally. Although U.S. users can pick a 3GS up for $49 (with a contract), if you live in Belgium, it's 529 euros, or $759 (unlocked). In China, $617. Prices in most other countries where it's available are comparable.

iPhone 4S: a Downgrade?

Which brings us to what exactly the "iPhone 4S" probably is. As some have speculated, it probably won't actually be a speeded-up version of the iPhone 4, the same way that the "S" in iPhone 3GS designated a faster iPhone 3G. If anything, it'll probably be a significant downgrade to the iPhone 4, closer to the speculation around the so-called "iPhone Nano." Apple would almost certainly need the new cheapo iPhone 4S to cost less to build than the iPhone 4 in order to get the margins it needs for the whole project to be worth it.

If "fragmenting" the iPhone line still sounds out of character for Apple, consider that there used to be only one model of iPod. It took Apple three years to offer a lower-end model (the iPod Mini), and now there's a whole iPod family, each model satisfying a different part of the market, right down to the borderline disposable iPod Shuffle. Given the heat iOS is feeling from Android, a strategy shift isn't out of the question for Apple. The iPhone 5 will surely get the company a spike in market share when it debuts, but if it's still just satisfying one part of the market, that'll be short-lived. To counter the astronomical growth of Android, which IDC predicts will constitute 43% of all smartphones by 2015, Apple's going to have to look at new markets.

Finally, for observers of Apple events, there's one more reason that Apple might announce two iPhones instead of one this fall. It gives Steve Jobs possibly the most dramatic "One More Thing..." in the history of his keynotes. It's a stupid reason, and has nothing to do with business, but it's the one aspect to this whole strategy that would be very much in character for the company.

In a big change from the previous three events, Apple's 2011 Worldwide Developers Conference didn't reveal new iPhone hardware. Sure, attendees got details of iOS 5 at the June 6 keynote address, but true iPhone fans also left the session without any hint of what a new handset might offer or when it would arrive.

With Apple devices in particular, the rumor mill tends to kick into high gear in the absence of any official announcement. And that's certainly been the case with the iPhone 5. The first gossip started to trickle in even as the iPhone 4 went on sale last year, but in the last few weeks that trickle has become a flood. Some of the rumors contradict each other--one camp suggests a minor update with an iPhone 4S, while another predicts a big update with an iPhone 5--but disagreement, after all, often is what the rumor mill is all about. And since conflicting information can be hard to track, we offer this handy timeline of iPhone 5 rumor so far in 2011. We'll add to it as we go along, and please let us know if we've left any juicy tidbits out. Read More

Why is Apple winning? See white iPhone debacle

When Apple released the white iPhone 4 in April, a lot of people were scratching their heads. Others simply snickered. The product suffered a 10-month delay and a string of broken promises from Apple that it was “coming soon.” That’s not like Apple, which is usually as efficient as a blood-thirsty dictator.

At the time the white iPhone arrived, most in the tech industry were expecting the next iPhone to be released just a couple months later in June/July, since that’s been Apple’s pattern for the past four years. In retrospect, the launch of the white iPhone in April along with the launch of the Verizon iPhone in January should have been clear signs that pattern wasn’t going to continue this year. The current expectation is thatthe next iPhone will arrive this fall, potentially sporting Verizon LTE 4G connectivity.

The change in release schedule has certainly given the white iPhone 4 a longer shelf life. But, the significance of this product has nothing to do with the fact that it will likely be on the market for just 5-6 months. It’s about the power of “No.”

The power of ‘No’

The significance of the white iPhone 4 is that Apple didn’t release it until it got it right. The company apparently said “No” to the product over and over again because it wasn’t quite right and Apple felt that customers wouldn’t have been happy with it.

Apple has never specifically said what problems it had with the white iPhone. Its primary statement was a terse press release on June 23, 2010 that stated, “White models of Apple’s new iPhone 4 have proven more challenging to manufacture than expected.”

However, the most common theory is that the white iPhone 4 suffered from light leakage, due to the fact that white materials are a little more transparent than black. It sounds like Apple experimented with different materials, pigments, and designs to make it look right so that it didn’t turn yellow instead of white.

In the grand scheme of things, that doesn’t sound very important, and it isn’t. But, what is important is that Apple said “No” to the product repeatedly, swallowed its pride, and endured ridicule over the delay. Apple waited until it got it right, or at least right enough.

The same can’t be said for many Apple competitors recently. Google, Motorola, and Verizon released the Xoom before the Honeycomb UI was finished and app developers had time to rework their apps. Research in Motion released the BlackBerry PlayBook before Flash, the Android emulator, and several promised apps were ready. Last fall, Samsung released the Galaxy Tab before there was even a version of Android that worked well on tablets. This week we have another good example with Nokia announcing the Nokia N9 running Meego, an OS that Nokia has spurned in favor of Windows Phone 7. Why even release a product running a platform that you don’t intend to support in the years ahead?

I review a lot of products every year — most of the best products in tech. However, I also have a lot of products that come across my desk that I never review because they aren’t finished or because they are obviously patchwork products designed by committee or because I simply want to ask myself, “Why would anyone actually release this?” or “Who would use this?”

Steve Jobs on “No”

In recent years, Steve Jobs has famously said, ”I’m actually as proud of many of the things we haven’t done as the things we have done.”

Jobs has said this numerous times and to various audiences. However, this is not a recent conclusion. If you go back to when Jobs first returned to Apple in the late 1990s, he loudly proclaimed that the key to turning things around at Apple and releasing better products was learning how to say, “No.” Here’s what Jobs told the audience at Apple’s Worldwide Developers Conference in 1997:

“When you think about focusing, you think focusing is saying, ‘yes.’ No, focusing is saying, ‘no.’ You’ve got to say, ‘no, no, no, no, no.’ And, when you say ‘no,’ you piss off people and they go talk to the San Jose Mercury [News] and they write a shitty article about you. And, it’s really a pisser because you want to be nice… So, you take the lumps, and Apple has been taking their share of lumps for the last six months in a very unfair way and has been taking them like an adult, and I’m proud of that… But, focus is about saying ‘no’ and the result of that focus is going to be some really great products.”

Bottom line

The lesson here is not that companies should always wait until their products are absolutely perfect before they release them. If that were the case, very few products would ever make it to market, and many of them would be too late to make a difference. The key is knowing when a product is perfect enough and when you should hold a product for improvements versus releasing it to get it in the hands of eager customers. That’s the hard part, but it’s also the thing that great companies do well.

Another tech company other than Apple that may get it right in 2011 is HP. Since the company bought Palm last year, it has been working on a tablet that marries the goodness of webOS with the tablet hardware expertise of HP. The HP TouchPad officially arrives on July 1 and the company has taken some heat for the extended delay. But, CEO Léo Apotheker recently said, ”We will not release a product that isn’t perfect.” Given the trail of incomplete tablets that have littered the market so far in 2011, that could bode well for the TouchPad (look for TechRepublic’s full coverage of the TouchPad next week, including a business-centric review and an extensive hardware analysis). Read More

Piolo, the handy little stand for the iPhone 4

Sometimes things don’t have so complicated to be useful. Simple can be effective most of the time. For instance, take The Piolo. This simple “stick” may not look like much, but what it lacks in complexity, it makes up for it in usefulness. If you’re a fan of watching videos on your iPhone 4, you know how tiring it can get to hold the phone up at the right angle for you to watch, or how tiring your neck will be from looking down on the phone if you leave it on the table or your lap.

Sure, there are docks just for those purposes, but what if you’re constantly on the go and can’t always bring your dock around with you? That’s where the Piolo steps in. This nifty tool that resembles an ice cream stick, with a chunk of it cut out, is meant to keep your iPhone 4 propped up at an angle to allow you to enjoy video calling, movie watching or just using the phone a more pleasant experience.

There’s really not much to say about the device – it is simple, and it does the job well. The only flaw I see would be the Piolo being designed to hold objects as thick as the iPhone 4. This means that people with cases on their iPhones will have to remove them before use – but for people with no cases, the Piolo is pretty flawless.

The Piolo is on sale now for only $6 and is available in five different colors – blue, pink, yellow, black, white and red. Head over to the Piolo website to find out more or to purchase one for yourself.  Read More

iPhone POS Device Spotted In Nordstrom

Mobile checkouts are the new thing. Nobody likes to wait in line to pay for an item especially if it’s an item you were on the fence about, and standing in the line gives you time to think about it. Maybe stores have started to realize that and decided that mobile checkouts are the way to go, plus the fact that it’s so much more convenient and you could basically arm every salesperson with the POS (point of sale) device and have multiple checkouts going on at once.

Well it looks like Nordstrom is one of those stores and judging from the photo above they have adopted the iPhone to be used as their POS device which not only allowed the salesperson from conducting a transaction with the device, but at the same time allow them to check whether they had a certain item in stock and all of this was done via the iPhone. Customers can apparently also choose how they want to receive their receipts and one of those ways was via e-mail.

It does seem like a novel idea but we’re guessing it’s only a matter of time before it starts catching on, especially in larger retail stores where the lines at the checkout counters get insanely long during the holiday seasons, so having salespersons roving about with a POS device could prove to be a way to start cutting down on those long lines and no more having to wait for a salesperson to run to the back of the store to check whether those pants come in your size. Read More

Edge-to-edge display in iPhone 5?

The iPhone 5 is not finalized just yet – or at least, there were not enough leaks to make sure that the general public knows what’s going on with the handset, but that does not mean there are no rumors circling this handset from Cupertino. Touted to sport an edge to edge display, how did people manage to come about this piece of speculation? Well, it seems that an application in the iTunes App Store known as SpeechTrans Ultimate Powered By Nuance, sporting several screenshots that show off an edge-to-edge display of the iPhone that runs said app to keep in in vein with the rest of similar rumors.

For those who have eagle eyes, you would probably have noticed that the app will sport a certain “Powered By Nuance” label in its title, not to mention Nuance being a name that is commonly touted when it comes to collaborating with Apple on speech recognition. What do you think? Is this rumor legit, or do we have to look elsewhere for more juicy details?

Note: The image above is a Photoshop job (obviously), where it was posted for reference purposes and serves as a form of illustration. It must not be taken as the final product. Thanks for all the comments, readers! Read More

Jelly Belly cases make your iPhone smell edible, come in BlackBerry flavor

ESI Cases Introduces Two New Jelly Belly® Products: Scented Line of Cases for iPhone, iPod and Blackberry; Earbuds in Classic Jelly Bean Shape

New York – June 15, 2011 – ESI Cases and Accessories, and licensing partner, Jelly Belly® have launched a comprehensive line of phone cases for iPhone® 4, iPod Touch®, iPod Nano® and Blackberry® with five of the most popular flavors of the Jelly Belly candy line represented. Each case is made of durable TPI plastic and scented with the Jelly Belly smell from each of the five flavors represented; Strawberry Cheesecake, Very Cherry, Blueberry, Licorice and Berry Blue.

"Jelly Belly candy is an iconic brand in American homes, especially among households with children," said Elliot Azoulay, president and CEO of ESI Cases and Accessories. "In addition to children who identify with these scents, many adults grew up with them and are thrilled to outfit their iPhone, iPod Touch or Blackberry with a durable case that protects their devices from scratches and damage."

Jelly Bean-Shaped Earbuds
Additionally, ESI has also added a line of jelly bean-shaped in-ear headphones in the same vibrant colors that match five of Jelly Belly's top jelly bean flavors. The earbuds, while unscented, make a fun complement to the scented cases.

"These jelly bean-shaped headphones are ideal for any consumers that want to make a fun impression with their friends and as they walk down the street," noted Azoulay. "While their unique shape is hard to miss, selecting one of the five colors can be either used to blend in with something traditional such as black (licorice) or bright and bold with deep red (Very Cherry)."

The Jelly Belly Cases for iPhone, iPods and Blackberry and headphones are available at numerous retailers across the country including F.Y.E. (For Your Entertainment), Hudson News and ShopKo with new stores continually being added. All products have a MSRP of $14.99 each. Read More

Top 10 iPhone and iPad apps costing $10 but worth the money spent

Paying $10 for a single app might sound difficult sometimes. But here are some which are worth spending on. These are far better than many free or less costly apps. Here are the top 10 such apps:

Real Racing 2 HD: One of the best racing games to show off your new iPad 2’s graphics. The app is known for its high-end graphics, absorbing gameplay and precise tilt controls. The game also offers great HDTV output and can be played on TV via cable.

Air Sharing HD: This app is needed to view and share documents wirelessly on your iPad and the documents can also be fetched from different cloud services. The device, with the app on, can act as a wireless hard-drive and can access Dropbox, FTP servers and
FilesAnywhere. Documents can also be printed wirelessly through shared printers on a Mac.

NetNewsWire: This is a must for news-hungry people who subscribe to different RSS feeds. The app helps you to synchronize all the feeds and read under one tab. It also has a built in Google Reader and Instapaper, as well as in-built web browser and interface animations. It helps keep your various RSS feeds in check.

Scrabble for iPad: The classic game has been modified to give it a new and enhanced look. The app has integrated with Facebook and provided with various multiplayer capabilities. You can play with four players in the local party mode or connect with up to 25 others online. A personal tile rack is also available via a different companion app.

Golfscape GPS Rangefinder: Golfers will get an access to more than 30,000 golf courses all over the world via the device’s camera as an augmented reality. The app provides you with accurate distance analysis when you point your camera towards the hole. The interface is clean and spontaneous.

IM+ Pro: One of the most popular Apple apps, this gives you an access to various accounts such as Google Talk, MSN, Yahoo, Facebook and Twitter. Its acts as a universal app that supports almost every IM network. The app also gives you chat history and an optional in-app purchase where you can just dictate your messages.

dJay: An ideal app for upcoming DJs, its real-to-life turntable interface with mix recording capabilities makes it more attractive. The app can be used to mix party tunes from an iPad. A different app is available for pre-cueing.

Haunted Mirror: This app is an engaging puzzle game with a creepy storyline. The graphics and sound effects are immersive. Hundreds of hidden objects are to be found in the puzzle while you try to escape from the haunted house you are trapped in.

FlightTrack Pro: This app has been made keeping in the mind the travelers who fly frequently. The app’s aim is to help you handle unknown settings at airports all over the world, while providing you with different flight information. The American airports get a 10-day weather forecast. Selected airports also show baggage carousel.

Monopoly: This all-time classic game has been given an alteration with a touchscreen. The game is a four-way multiplayer for iPhone and iPad touch users and can also be played as a tabletop game where the app rotates automatically to face the current gamer. Extra features include customized house rules and dice data analysis. Four new difficulty levels have also been included.  Read More