Apple iPhone

Apple iPhone Introduction Apple's 30-year history is full of highs and lows, which is what we would expect in a highly innovative company. They evolved throughout the years into an organization that is very much a representation of its leader, Steven Jobs. Apple made several hugely successful product introductions over the years. They have also completely fallen on their face on several occasions. Apple rarely introduces a new type of product. Thus, instead of being the pioneer, they are an expert "second mover" by refining existing products. Portable music players and notebook computers are some of these examples. Apple increases the appeal of these products by making them stylish and more functional. They now appear poised to make significant strides in the home computer market and to creating a total digital lifestyle whereby the home is a multimedia hub. Apple lives its vision through the technologies it develops for consumers and corporations. It strives to make its customers masters of the products they have bought. Apple doesn't simply make a statement. It lives it by ensuring that its employees understand the vision and strive to reach it. It has put systems in place to enable smooth customer interaction. It has put objectives in place to continuously move forward; implemented strategies to fulfill these objectives; and ensured that the right marketing, financial and operational structures are in place to apply the strategies. Apple's iPhone, iPod and ITunes are a powerful combination that fosters a network style of increasing returns. By selling iPhones, Apple increases the consumer demand for music from iTunes. By placing more musical choices on iTunes, there is more demand for iPods and iPhones. Apple had 70% of the legal music download market in early 2005. It is said that variety is the spice of life. This is indeed very true and it is also true for music. In addition, if one has an iPhone, there is no better way to have music on the go. It does not matter where one is heading to; everyone wants music in his/her life. The portable CD players are now a thing of the past. Digital music is available as MP3's. These files are easily carried with someone be it in an MP3 player or an iPhone. The Apple iPhone makes retrieving one’s favorite tunes in a snap. Just a touch of a finger and one can quickly browse through all of his music. iPhone 3G The iPhone is an internet-connected multimedia smart phone designed and marketed by Apple Inc. Its minimal hardware interface lacks a physical keyboard, so a virtual keyboard is rendered on the multi-touch screen instead. With fast 3G wireless technology, GPS mapping, support for enterprise features like Microsoft Exchange, and the new App Store, iPhone 3G puts even more features at one’s fingertips. And like the original iPhone, it combines three products in one — a revolutionary phone, a widescreen iPod, and a breakthrough Internet device with rich HTML email and a desktop-class web browser. Music Features: The iPhone rules the music phone industry; it easily synchronizes up with iTunes and plays both iTunes formats and MP3s. Finding one’s tracks is beyond easy with this phone, one can simply flick through the album covers with the ‘cover flow’ feature, tap the album he wants to listen to and drill down to the song he wants. It uses the same kind of docking connection as the iPod, so it works with all kinds of iPod toys and accessories. It has the ability to play streaming music but cannot download songs from iTunes directly; one has to use his PC or Mac for transfers. According to pre-release reviews, the sound quality for music was amazing and the ear buds that came with the phone were adequate. Voice/ Text Features: This cell phone includes all basic cell phone features such as text messaging, speaker phone, conference calling (up to five) and voice dialing. The most wonderful, exciting and practical feature in the iPhone is the visual voicemail. With visual voicemail one can view his voicemails similar to an email inbox. So one can actually sort through his voicemails and listen to just the ones he wants and in any order. One can even back up the recording and listen to any part of the message without having to re-listen to the whole message. It also has threaded text display, so one can see an entire text conversation and easily stay on topic. Internet Features: The iPhone uses a Safari type browser for web browsing which works exceedingly well. The phone has a huge 3.5 inch screen that displays full web pages and one can easily zoom in on an area of interest with a few taps of his finger. One can also just tilt the phone to look at web pages in portrait or landscape orientation. The iPhone can automatically detect and connect to a Wi-Fi connection. Lifestyle Tools: This phone includes the basics, like a calendar, calculator, alarm clock and an airplane (or flight) mode. It also has an excellent map and travel tool that utilizes Google maps. With Google maps and the iPhone, one should be able to easily find restaurants, hotels or other points of interest in any city one is visiting. It does not however offer GPS tracking, so one can view maps but the phone cannot tell where the person is on the map. This phone has a 2 megapixel camera and a great photo organizer. One can also zoom in on images and reposition them quite easily. It can also play movies and video clips and it has a direct connection to YouTube. Technical Specifications: The iPhone offers exceptional battery life, four or eight GB of flash memory and a powerful operating system. It also has a big, gorgeous screen that can display millions of colors. Typically, high end phones are battery drainers, but the iPhone has a seven hour battery life for general use. This phone is a bit wider than the other music phones, but it has a much larger screen, otherwise it offers a fairly typical height and weight. Nearly all interactions with the phone take place through the multi-touch screen. Compared to other music phones, this cell phone has the best internal flash memory capacity at 4GB or 8GB. But it does not have an extra memory slot. Unlike other music phones, the iPhone offers a high-end operating system, it runs OSX. The screen offers two orientations and switches by turning the phone. Movies can also be switched between standard view and wide screen view with just a few taps. One major problem with this phone is that the battery is expected to only last 300 to 400 charges, which means one might have to replace his battery once a year for about $80 plus shipping. Significant Network Management Problems In April of 2007, Peter Oppenheimer (Apple's CFO) announced that Apple will be using what is commonly referred to as the "subscription method of accounting" for sales of the iPhone where the sales revenue from the iPhone is deferred and recognized over a 24-month period instead of at the point of sale. Both that decision and the underlying reason in support of the decision would go down as being one of the worst in Apple's history. In his opening statement of the 2007 earnings call, Oppenheimer made the following alarming comments: "Since iPhone customers will likely be our best advocates for the product, we want to get them many of these new features and applications at no additional charge as they become available. Since we will be periodically providing new software features to iPhone customers free of charge, we will use subscription accounting and recognize the revenue and product cost of goods sold associated with iPhone handset sales on a straight line basis over 24 months. So while the cash from iPhone sales will be collected at the time of sale, we will be recording deferred revenue and costs of goods sold on our balance sheet, and amortizing both of them into our earnings on a straight line basis over 24 months. We will continue to expense our iPhone engineering, sales and marketing costs as we incur them. This accounting policy will have no impact on cash flow or the economics of our business." This was the first time the financial community learned about Apple's plans to defer iPhone sales revenue. Until that moment, everyone was expecting some dramatic blow-out growth rates for 2008. Such hopes were dashed when Oppenheimer decided to give iPhone customers free $9.95 software upgrades at the inevitable sacrifice of Apple's stock price. A year and a half later, Apple was trading at the same price it was before the iPhone even existed, and was portrayed as a company that struggles to grow and as a company that faced major financial headwinds in 2008. While the recent financial turmoil, the 2008 recession and serious concerns over Steve Jobs' health is much to blame for the loss in share value, Apple could be trading at much higher levels if the revenue from the iPhone were recorded when received instead of how it's treated under the current accounting regime. Security Problems There's a huge security problem in the latest iPhone. If one has his Phone password protected, using a very simple trick gives anyone full access to his cell phone private information in Mail, SMS, Contacts, and even Safari. That's why many organizations have restricted or even banned employees from using devices like USBs and other portable players. Yet the iPhone is shaping up as a particularly difficult technology to block. That's because massive media hype has convinced many employees that the iPhone, despite its many security shortcomings, is actually an essential productivity tool. The iPhone's iffy security also extends to the road. Unlike the Blackberry and other enterpriseclass telecom devices, the product doesn't allow users to lock the unit or destroy stored data in the event it's lost or stolen. That means an iPhone could disappear without a trace, placing sensitive e-mails and other data into the hands of strangers. Managers also worry about iPhone's capability to store prodigious amounts of data. The unit can function like an external storage device (and will be recognized as such by most networks), storing up to 4GB or 8GB of data, depending on the model. This means unscrupulous iPhone users can swipe large amounts of data from unsecured enterprise PCs. The fact that iPhone will use an operating system and Web browser that have been available, in one form or another, for years will please users seeking reliability and familiarity. But to IT managers, this time tested, standardized approach means that hackers will have had a head start in finding entry points to exploit. Many managers also worry that all the media hype surrounding the iPhone will tempt ambitious hackers; those seeking notoriety to target the product. Meanwhile, the iPhone's closed operating system will make it impossible for users or IT managers to install software from security companies on the device. David Maynor, a security researcher with Errata Security, recently stated that he's already discovered a bug in the Apple Safari browser that will be used on the iPhone. Maynor claims that a backdoor can be exploited to hijack the iPhone with hidden software, just as hackers have used malware to herd millions of unwitting PCs into robots that send spam, attack Web sites and steal financial data. Technical Problems Customers of iPhone have reported some technical problems related to iPhone. As well as problems with registering the iPhone 3G, users have also found one of the Apple's built-in service known as MobileMe unavailable at some times. It's not just activation problems that have marred the launch of the new 3G iPhone - Apple has admitted that its new datasynchronization service, MobileMe is also suffering from some technical difficulties. MobileMe is a subscription-based service that allows users to edit, update and synchronize their calendars, contacts, photos, files and emails between multiple computers and their iPhone or iPod touch, via the internet. Subscribers to the data-synchronization service are experiencing problems logging onto the new MobileMe site. A notice on the MobileMe site read: "MobileMe temporarily unavailable. We are working hard to restore normal service. Check back soon". And on the .Mac site, visitors were greeted by the message: “The MobileMe transition is underway but is taking longer than expected. While core services such as desktop mail, iDisk and sync are available, the new MobileMe web applications are not yet online. Thank you for your patience as we complete the upgrade”. Apple iPhone strategy to handle Digital Convergence According to the AMR "Supply Chain Top 25" report, the analysts noted that while Apple could have stumbled in meeting the demand for the original iPhone in 2007, it did not. "Behind-thescenes moves like tying up essential components well in advance and upgrading basic information systems have enabled Apple to handle the demands of its rabid fan base without having to fall back on their forgiveness for mistakes," notes the AMR report. Even with the technical problems and mild customer frustrations, Apple Corporation doesn't think there's cause for alarm at Apple. "No one's chucking their iPhone," they say. Apple Corporation is striving to master the physical supply chain and their problems are not on the physical side; they have the product in stock. So, they have done it. There aren't too many companies that experience the physical and digital convergence intensity like Apple is. The importance of blending digital and physical supply chains is a trend that will only continue, however. Strengths Technical Savvy: Apple iPhone product lines are easy to use and stable. Recent integration with Microsoft product lines and Intel processors demonstrate ability and willingness to adapt to a diverse customer base. Financial Vitality: Cash reserves remained robust and stable despite stagnant market growth share growth in the computer software and hardware arenas. Apple exploited this by resisting market pressures to reduce costs, tightly integrating product packages, and forming strategic alliances (securing the backing of all major music distributors in the support of iTunes). Brand Loyalty: The only way Apple iPhone could maintain the financial vitality described above is via a fanatical affair with is customer base. Such brand loyalty is extremely costly and time consuming to imitate. Weaknesses Market Share: Apple has historically been strongest in the US geographical and educational vertical markets. With the educational market facing tightening budget constraints and the US approaching a PC saturation point, Apple may need to burn cash more quickly and withstand market cost pressures on its products without a strategic innovation, integration or divesture. Future Plans Apple announced that applications will be developed and distributed for the iPhone. At present, developers in the US can register for the Standard Program for $99 per year, or the Enterprise Program for $299 per year. The Standard Program gives members the final SDK - a set of APIs built around Apple's Xcode development environment - pre-release iPhone software and technical support. This program also allows developers to test on an iPhone, rather than using the free simulator option that's otherwise available on the Mac desktop. The program will be rolled out in other countries as well. Apple clearly hinted at Exchange support when it sent out invitations to the roadmap event. It has licensed ActiveSync from Microsoft, which commented upon this spirit of continued cooperation between the companies, "Microsoft believes in building open and interoperable products, and Microsoft Exchange Server is no exception." Apple will build Exchange support into the iPhone. In the demos, it appeared first in Mail's list of account types. It adds support for reading Word, Excel and PowerPoint documents received as email attachments. Mail also gains the much requested ability to delete and move multiple email messages at once. Push services will also be delivered at a later date. Apple iPhone has proved to be one of the most enigmatic creations that has proved the superiority of Apple Inc. Like iPod, consumers were expecting a lot from this glamorous phone, and Apple iPhone has proved to be much above people’s expectations. References www.apple.com www.google.com http://trad.org http://www.divisiontwo.com/articles http://www.cnet.com http://bullcross.blogspot.com/2009/01/how-iphone-and-poor-apple-management.html http://www.telegraph.co.uk/scienceandtechnology/3357873/New-Apple-iPhone-MobileMeservice-suffers-technical-problems.html http://www.macworld.com/products/iphone.html http://en.wikipedia.org/wiki/Apple_iphone