Apple's iPhone and its Impact on the American Mainstream Smartphone Market

As my contract with AT&T is due to expire in the latter half of this year, I have the option to *upgrade* to a better phone with a good discount on the device in return for committing myself to two more years with AT&T. While I disprove of the two year commitment, high monthly fees, and discount on the device style of contracts, I am obliged to stick with AT&T because I have the main line of my family's AT&T family plan. Therefore, although Android phones are coming to AT&T, the best choice for a smartphone is the iPhone.

Speaking of Android and iPhones, it is interesting to see the commentary on Microsoft's Windows Phone 7. To this day, technology pundits still compare new smartphones and their operating systems with the iPhone, the giant in the smartphone industry. With every release of a new mobile operating system, there are some out there who claims it will be the "iPhone killer", meaning it will be the one who takes control of the market share from the current leader in a David vs. Goliath battle. Some are so adamant on finding and declaring iPhone killers that they have established informational web sites that educate people on iPhone alternatives.

In any situation where the rest of the competition are all attacking the same party, there has to be some merit to the defendant. The Apple iPhone, first released in the summer of 2007, has been refined many times in terms of software, hardware and network. First generation iPhones ran on AT&T's 2G EDGE network and only ran Apple's native applications. The second iteration of the product took advantage of AT&T's developed 3G network, allowing for faster data access speeds. (For the laymen unfamiliar with the cellular network terminology, simply remember that higher the number of G's a network is, the faster the data speeds will typically be i.e. 3G speeds > 2G speeds) In 2009, Apple only made minor upgrades to the device, those that were also found from the transition from its initial release to the second generation of the device, such as faster processor, better camera, and additional features in the operating system.

Even from the get go, the Apple iPhone, despite its lack of certain features desired by consumers, defined the new generation of consumer smartphones. Smartphones were by no means new to the cell phone industry, but they were primarily reserved for businesspeople because the costs associated with purchasing and maintaining the device and service was unjustifiable with the device's usage - until the iPhone came out. Apple redefined, or even pushed the frontier, for the consumer smartphone market. Again, Apple did not invent the consumer smartphone industry, but its product had new features that appealed to the mainstream cell phone customers. The intuitive operating system combined with an equally interactive input method, namely the touchscreen, allowed even the most technologically uninitiated to understand how to manipulate the device quickly. This instantly lowered the learning curve and lowered the technological barrier for adoption for most people.

However, the high sticker price was definitely still an issue for most people. Initially the device went for $499 at the cheapest option. Keep in mind that this is the subsidized price, meaning that AT&T has to pay Apple a share of the money they get from the monthly bills over the two years the iPhone customer would be committing to. The monthly plan attached to the iPhone, at least for the 3G service, comes with a certain number of minutes for voice calls and unlimited data. Text messaging will again be a separate fee. $69.99 per month would get an iPhone user, who has already paid a few hundreds of dollars for their device, voice calls and "unlimited data" access. What is intriguing and essentially puts the final nail in the coffin for me is that even if one chooses to pay the unsubsidized price for their iPhone, meaning it will cost an additional few hundred of dollars, they still pay the same monthly fees as those who paid the subsidized price.

Logically, the high monthly fee for the iPhone is only justified because AT&T has to recuperate their losses of having to pay Apple for the subsidized price by locking the customer into paying per month for at least 24 months. However, how is it justifiable to make those who don't want commitment and already paid for the iPhone in full, meaning they've settled their debt with Apple, to line AT&T's pockets with extra money that's not going to Apple?

Despite the flaw in the pricing logic, the iPhone has been immensely successful, as demonstrated in the aforementioned analysis of the "iPhone killer" concept. Apple keeps on perfecting their product with each new reiterations of their device while the rest of the market tries to play catch up. It has inspired the competition to either compete head on with a new mobile operating system, such as Google's Linux-based Android; refine their existing mobile operating system, like PalmOS and Windows Mobile; or avoid the smartphone industry entirely, which seems to be be Nokia's strategy. Nonetheless, the Apple iPhone probably has the strongest market share of the regular mainstream cellular phone consumer, which is why I'm opting for the device to, to be explain in a subsequent article.

For the full story and more like it, check out Gotlactose Development.

Comparison of Cars

I have access to four different cars and I've driven each of them enough to give a good analysis.

1996 Honda Odyssey
1999 Toyota Corolla
2005 Honda Accord
2008 Toyota Camry

Of all four cars, I find that the Honda Accord is the most comfortable to drive. The moment I got behind the driver's wheel, I could feel how comfortable the entire driving experience was in the Accord. The steering wheel responded smoothly under my hands and the acceleration and brake performed just as well.

The Toyota Camry leaves me with a sour taste in my mouth after driving it. I can see that Toyota has put in effort at designing a good driving experience, but it doesn't handle as nicely as the Accord does. The one good design I like about the Camry is the transmission stick: instead of the shift lock button to prevent accidental gear shifting, there are horizontal and vertical wells to shift into gears, which makes for shifting gears while driving much easier.

The Honda Odyssey, despite its age, is still a good minivan to drive. The rate of acceleration is a far cry from the newer cars, but the car still handles well given its circumstances.

The Toyota Corolla was my very first car and I got my license with this baby. It has its merits and I love it for its maneuverability and compactness, but I will admit that it lacks in aesthetics and horsepower.

I'm no car guy, but I can definitely appreciate cars and their performance.