What has Apple done to iPhone carriers?
Apple made two announcements yesterday that don’t bode well for carriers that have committed to the iPhone.
The big announcement was the introduction of the iPod Touch. This device is basically an iPhone without the phone. It uses WiFi, runs Safari as a web browser, and includes all of the cool music, photo, and video applications that made folks drool for months between the announcement and availability of the iPhone. Since the iPhone currently only supports slow EDGE cellular data connectivity, most folks have used WiFi whenever possible to run these cool apps. The Touch also provides access to iTunes over the air, which was also announced for the iPhone yesterday (but “over the air” for the iPhone means over WiFi, not over EDGE, limiting the mobility value).
What made the iPhone such a highly desired product? It is an incredibly cool iPod. Just like the Touch (although the Touch offers more storage for your tunes). It is a mobility-powered Internet device. Just like the Touch. It features a super-cool multi-touch user interface. Just like the Touch. It is a passable phone with the challenges of a touch-screen-only keypad. The Touch forces you to carry two devices - a great music-player/Internet-device and a great phone.
Those (like my co-workers at Sprint) who couldn’t bring themselves to sign up with the exclusive iPhone carrier but dreamed for the music and Internet capabilities of the iPhone undoubtedly are rejoicing today.
The carriers that have given in to Apple’s unprecedented demands have got to wonder what the Touch means to them. Has the pipeline of customers dying to get off their current carrier just to get an iPhone just dried up? Has Apple confirmed that EDGE really is as bad as critics claim? Time will tell.
The second announcement of note is Apple’s dramatic $200 price cut on the iPhone. Most analysts interpret this as an indication that Apple is worried that they won’t hit their sales targets. Of course, this means that the exclusive iPhone carrier would also be falling behind in hitting it’s sales targets. Again, time will tell.
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