Saturday, July 5, 2008

3G iPhone Launches July 11th-Are You Ready?

3G iPhone: Where’s The Beef?

With much anticipation around the world, the Apple World Wide Developers Conference (WWDC) kicked off on Monday June 9, 2008 at San Francisco’s Moscone Convention center. All eyes were on the Cupertino California based maker of Macintosh computers, iPods, iPhones, and consumer electronic devices for what has been touted as the most anticipated hardware update/upgrade of the year--the 3G (third generation cellular) second iteration of the infamous Apple iPhone.

Ever since Apple CEO Steve Jobs introduced the iPhone back in January 2007 at Macworld in San Francisco, the pundits have been pouncing all over its few shortcomings, focusing squarely on its lack of a broadband speed wireless connection. Jobs cited the lack of adequate sustainable battery power to support such a power-hungry radio that would dramatically cut the iPhones usability time between charges. Fast-Forward 18 months later and that argument has all but disappeared in favor of what has been revealed to be the new 3G iPhone that will have longer battery life despite the addition of 3G capabilities.

First of all, let’s give credit where credit is due. The iPhone is truly revolutionary in both its form factor as well as its incredible features. Never before has a cell phone or PDA generated so much hype, positive feedback and consumer satisfaction. If Job’s key note statement is to be believed, the iPhone has garnered an unprecedented 90% overall customer satisfaction rating from users of iPhone 1.0. That is truly an amazing feat. With over six million iPhones sold over the past 11 months, to say that at least 5.5 million buyers were completely satisfied with their purchase is an incredible satisfaction rate never before seen from any single consumer electronic device. Enter act II.

In the keynote address that opened Apple’s WWDC, Jobs spent almost two full hours touting the improvements and enhancements that Apple has been working on since the initial launch of iPhone 1.0 on June 29, 2007. Key amongst those features, and the most expected upgrade was indeed the addition of a 3G HSDPA transceiver (3rd Generation High Speed Downlink Packet Access) for broadband wireless internet access. iPhone 1.0 uses EDGE (Enhanced Data rates for GSM Evolution) which is significantly slower than HSDPA. To compare the two, EDGE would be similar to really fast dial-up or ISDN connection vs. HSDPA which can be compared to lower end home DSL speeds. EDGE typically allows for 100-150Kbps average downloads, where HSDPA is supposed to provide 450Kbps-800Kbps and sometimes even faster download speeds. Jobs claims that despite the addition of the power hungry 3G radio, the new 3G iPhone will actually have better battery life than its predecessor thanks to recent improvements in battery technology and chipsets. (Estimated at 300 hours standby, 25 hours of music playback, 10 hours of 2G talk time and 5 hours of 3G internet surfing)

The second most anticipated and expected upgrade to the iPhone was the addition of a sorely needed GPS chip. The first generation iPhone with its much touted Google Maps application relied on both WiFi and cellular triangulation methods to pinpoint a users’ location, a process that is imprecise and not always accurate, especially if you don’t have a good cellular or WiFi signal. With the inclusion of the GPS chip, the 3G iPhone can now pinpoint your location within feet, instead of yards or miles. Location based marketing & points of interest as well as photo Geo tagging have become very popular in the past couple years with the advent of more cell phones that sport both a camera and a GPS chip. Finding the nearest Starbucks or gas station no longer requires anything more than a cell phone with a built in GPS chip since millions of points of interest exist on most GPS mapping software applications which are constantly being updated (in real-time) on Google Maps so you’re not having to waste trips to locations that have been recently closed down, moved, or gone out of business.

In terms of its physical look, the 3G iPhone didn’t change much when you’re looking at it from the front. The same gorgeous, vivid and bright 3.5” LCD touch-screen still graces the major portion of its fa├žade. Not much has changed from that perspective. From the rear, the 3G iPhone has a whole new back that is much more curved than its predecessor, and the back is made of a solid hard plastic material instead of the almost entirely metal backing that graces the back side of the current iPhone. The edges of the 3G iPhone are smoother and curvier too. One notably positive physical change in the 3G iPhone is the earphone/headset jack. In the first generation iPhone, the earphone jack is recessed, requiring a specially made plug to fit it. You couldn’t use just any off the shelf pair of earphones unless you bought an adapter for it to fit in the small hole. With the 3G iPhone, the earphone jack is flush with the top of the unit, making it easily compatible with your favorite pair of earphones/headsets that connect with a standard 3.5mm plug.

Lastly, what came as somewhat of a surprise to many was the substantial price reduction on the 3G iPhone compared to the current inferior iPhone 1.0. Recall that back in June 2007 where the original 8Gb iPhone would have set you back a whopping $599. What a difference a year makes as you can now own the new and improved 3G iPhone for two-thirds fewer George Washington’s at $199-all thanks to a new carrier subsidy deal that Apple made with AT&T. Unlike their previous arrangement, Apple will no longer be getting a cut of subscribers’ monthly fees as they were with the first generation iPhone. Apple decided it was more important to focus on unit quantity volume if it were to reach sales goals and compete with the likes of Blackberry maker RIM (Research in Motion) which commands about 40% of the PDA cell phone market without any carrier residuals.

A 3G 16Gb iPhone was also announced for $299 which also represents a $200 price reduction from its predecessor, and this version will come in a choice of a black or white back cover (If you want a white back iPhone, you have to spring for the $299 16Gb 3G iPhone). The 3G iPhone will go on sale July 11, 2008 according to Jobs. It was also announced that it would be available in over 22 countries initially, with a total of 70 different countries getting the iPhone by the end of this year. Apples hopes to have sold ten million iPhones by the end of this year, and with such aggressive pricing, it should have no problem reaching that sales goal given that Apple is more than half way there already.

With the new 3G iPhone will come a new firmware version 2.0 and a whole new slate of third party applications that will soon be available to all iPhone users, old and new. Apple had announced in January of this year of that the availability of a software developer’s kit for the iPhone was forthcoming and it was released this past February. Apple also announced an iTunes iPhone App store to come online in June of 2008. More iPhone software developers signed on to Apple’s iPhone development program than could be accommodated, and they downloaded more Software Development Kits (SDK’s) from Apples website than any SDK in software history. It was expected that the iPhone App store would have been online this now, but it appears that this date somehow got pushed back to July to coincide with the launch of the 3G iPhone on July 11, 2008.

Something iPhone 1.0 owners were never allowed to do was add sorely lacking third party applications to their iPhones without Apple’s blessing or cooperation. Of course, that didn’t stop hackers from reverse engineering their way into the new iPhones, voiding Apple warranties and spreading iPhone application joy everywhere. At last count there were literally hundreds of third party iPhone applications already working on what has been commonly referred to as “Jailbroken” iPhones. Jailbreaking an iPhone is the process by which a user hacks the iPhone internal software to open up the operating system so to be able to read and write to it, a procedure that Apple didn’t really want to happen as they kept updating firmware to closely guard against iPhone hacking. In the end, the hackers prevailed and it is widely believed that this cat and mouse game pushed Apple to finally release its iPhone SDK sooner rather than later.

Amongst the apps demonstrated at the WWDC were full motion video games from Sega that looked extremely sharp on the iPhones gorgeous screen, specialty medical applications, Major League Baseball (MLB) scores application, a music creation program, and an Ebay account/auction manager application. All these apps promised to help users be more productive on their iPhones. Most applications would cost $9.99 from the Itunes iPhone App store or be free, depending on the developer’s wishes, with 70% of the revenue going to the developer and 30% to Apple to cover costs of hosting, credit-card fees, etc. The App store will be the only way to get Apple sanctioned third party apps on the 3G iPhone or updated 1.0 iPhones that will be updated to iPhone firmware 2.0 at no cost to those owners. Since the iPod touch is a subset of iPhone (basically an iPhone without the phone function) iPod Touch users will be able to take advantage of the 2.0 firmware at a cost of $9.99 when it is released.

Of course the other major announcement made earlier this year was that the iPhone would finally become enterprise friendly. Up until now the iPhone didn’t play well with most enterprise email, contact, and calendar systems. Apple decided that in order to compete with the likes of RIM, Nokia and Microsoft, they needed to license both MS Active-sync and MS Exchange server from Microsoft. Without going that route, enterprise integration would be a pipe dream, especially since most enterprise customers use Active-sync and Exchange as their primary means to distribute email and other information to its users, as well as keeping information secure using over the air synchronization. What this also means is that Push Email (email that is PUSHED on to your device as soon as it appears in your regular email mailbox-hence the term push), which is the hallmark of all Blackberry devices is now finally possible on the iPhone.

The last major announcement Apple made during the Keynote involved its aging online Dot.Mac service. Dot.Mac is Apples $99 a year online storage and email service that currently provides up to 10Gb of storage space to its annual subscribers. Dot.Mac is going away in name only in favor of a new enhanced service called MobileMe (not active yet). What MobileMe does is provide everything Dot.Mac offered, plus some very welcome new features. One new feature would be push email for the non-enterprise user on the 2.0 firmware iPhone. Right now, there is no real push email on the iPhone, (some users had pseudo push email with Yahoo! Mail-but no one ever had consistent push email) something many users have complained about. Other features of MobileMe provide the convenience of synchronization of an iPhone over the air with ones’ MS Outlook or Apple iCal application for contacts and calendar information. Of course you can still upload pictures, videos, and data files at will. MobileMe will provide up to twenty gigabytes of combined online email and file storage, as well as unlimited synchronization over the air from you iPhone for the $99 annual fee.

With the new announcements came some disappointments in what wasn’t announced that will sure to keep some potential buyers on the sidelines. Most importantly is the fact that the 3G iPhone is still tied to AT&T exclusively. No one knows for how long, but five years is the consensus. Many users in the past that are currently tied to the other U.S. GSM carriers like T-Mobile as well as other GSM/GPRS carriers around the world have purchased an iPhone and unlocked them to use on their respective carriers, however this time around that trick won’t be so easy to accomplish. AT&T will be requiring in-store activation and another new two year agreement (two years from the date of upgrade or purchase) if you want a new 3G iPhone or want to upgrade to the 3G iPhone if you are an existing iPhone user. The same activation process will supposedly be implemented at Apple Stores as well to insure that iPhones that are being subsidized by AT&T don’t get shipped overseas or used on carriers other than AT&T in the U.S.

In what is likely to be very controversial, the only way possible to cancel your AT&T contract is to return the 3G iPhone to the store where it was purchased before AT&T will terminate your service. It’s not clear if that rule applies after the new extended 30 day & 10% restock return period, but a $175 early termination feel will apply after 30 days of activation if you choose to terminate your agreement before your 2-year agreement is up.

Unlike the first generation iPhone where you walked into an Apple or AT&T store with cash/credit card in hand and walked out with a sealed iPhone and later activated it at your leisure at home, this time around it will be more inconvenient and time consuming at the point of purchase where the iPhone leaves the store activated, something AT&T and Apple say will take no more than ten minutes. The unconventional approach to cell phone activation with the first generation iPhone (or lack thereof) produced over a million of iPhone hardware sales for Apple that never morphed into the revenue generating activations for Apple and AT&T as was the expectation since consumers instead readily unlocked them and used them on alternate carriers. Some analysts estimated that as many as 3 out of 10 iPhones were never activated directly thru AT&T as they tecnically should have, costing both companies anticipated revenue.

The 3G iPhone comes with another caveat for potential T-Mobile users in the U.S. Since T-Mobile finally announced the launch of its own 3G HSDPA/UMTS broadband wireless service this month in New York (slowly being rolled out nationwide), many thought they could simply wait and buy a new 3G iPhone and use on T-Mobile’s upcoming 3G network. Unfortunately this isn’t going to be possible since T-Mobile USA’s new HSDPA/UMTS network happens to be what is called an AWS (Advanced Wireless System) something the 3G iPhone HSDPA transceiver in its current form isn’t compatible with--making 3G internet access on T-Mobile’s 3G network all but impossible. Yes, you can most certainly use a 3G iPhone on T-Mobile and any other GSM carriers since it is a GSM phone first and foremost, but you will be stuck surfing the internet at slower EDGE speeds. Jobs demonstrated a comparison between EDGE, HSDPA and WiFi internet downloads on the new 3G iPhone and that demo showed HSDPA to be at least twice as fast as EDGE, and almost as fast as WiFi broadband.

The other disappointments that became obvious this week are common complaints that date back to the 1st generation iPhone. Those complaints include the lack of Adobe Flash (something many websites including YouTube use to speed up and enhance user website experiences) which without of course you can’t view those websites properly. For a such a versatile device that touts full page internet browsing as its primary claim to fame, (one that is very true), it is inexcusable that Apple and Adobe have not come to an agreement to put Flash on the iPhone one year after its launch. Adobe claims to be working on a fix for this, but so far nothing concrete has been seen from them. Many believe that this is a revenue issue both Adobe and Apple need to come to terms on, thus forcing Apple to leave Flash functionality out of the iPhone altogether.
Another inexcusable shortcoming in the 3G iPhone is the lack of a cut, copy and paste function on any iPhone old or new. This one leaves many asking why something so simple, yet very important is still not a part of the iPhone user experience.
Much to the chagrin of both current iPhone users and some non-iPhone users, the iPhone still lacks a hard keyboard (The iPhone uses a touch screen keyboard) something that will probably never change, so no one really expected any alterations to the keyboard to be announced. Other user complaints include the lack of a synchable task manger (To Do List) application, although this will probably be resolved next month with the opening of the iPhone App Store within iTunes.
One other major common gripe of the iPhone is its lack of A2DP (Advanced Audio Distribution Profile). A2DP is the term that is used when a Bluetooth equipped device is able to transmit/stream mono or stereo audio to a Bluetooth headset, earphones, or audio system. Yes you can use a Bluetooth headset to carry on a conversation, but you can’t listen to your iPod thru it. How is it that a device whose roots are a music player first and foremost not have the ability to stream audio via its Bluetooth radio? This too is also an inexcusable shortcoming of the iPhone old and new. Moreover you can’t use the iPhone to tether as a wireless broadband modem connection for your laptop-Bluetooth or hardwired.
There had been some rumors/speculation (there were plenty of them going around leading up to the announcement day) on the internet that suggested that there would be a front facing video camera on the iPhone to facilitate video conferencing. Alas, that was not to be, and neither was standard video recording on the iPhone, something that most die-hard iPhone fans had hoped for in this 3G iPhone. Video recording has been achieved by some enterprising third party developers and is currently available on Jailbroken iPhones today.
Overall, Apple kept its promises from it original initial iPhone launch to later offer a faster and better mobile internet experience. They did so by finally adding 3G broadband wireless to this new version of its ever popular iPhone. The GPS integration is also a great addition to the mix, and provides users with a more robust Geo-relative user experience. By adding enterprise compatibility to the iPhone, Apple also opened the doors to all kinds of possibilities and potential (not to mention sales). Making the 3G iPhone affordable and in line with the cost of the average subsidized cell phone was a great plus too. However in all fairness, the 3G Apple iPhone still has a way to go before it will be as perfect as Jobs would like us to believe. In Obi Wan’s famous words from Star Wars Episode IV, “These aren’t the Droids you’re looking for-move along” Here’s to looking forward to iPhone 3.0. Cheers!

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