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Thu 1 Feb 2007 11:32 AM

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Apple’s iPhone: form over function?

Diehard Apple loyalists will love the iPhone, but it is light on technical innovation.

The sight of sneaker-wearing Apple CEO Steve Jobs clutching the company's latest baby and preaching to the converted at the recent MacWorld Convention in San Francisco was enough to confound even the most ardent technophobe.

The fact that Jobs was trumpeting Apple's riskiest venture to date made for compelling viewing (albeit via the webcast!).

Jobs did what he does best, whipping the sycophantic Apple faithful into a frenzy, turning his keynote into equal parts pantomime and self-indulgence, and giving the geek finger to convention, albeit in typically ‘aint it cool?' Silicon Valley fashion.

Jobs' belief in Apple's newfound ability to conquer untapped markets at will no doubt derives from the success of the iPod, but the iPhone represents a very different beast to its less sophisticated rockin' cousin.

With the iPhone, Apple is attempting to change the rules of the game, but its bullish strategy for doing so even at this early stage appears to have its pitfalls.

The handset's limited hardcore abilities (not a Microsoft Windows Mobile application rival in sight) will surely turn off corporate users, as will the hefty price of US$599 for the 8GB version. Certainly, the iPhone appears a triumph of form, but is this at the expense of function? Probably not, at least in the minds of those few on the planet who actually bother to watch full-length feature films on their Video iPods. And therein lies the problem. By ignoring the corporate market, by refusing to include a 3G capability, and by tying with single network operators, Apple has created a very exclusive and costly product with arguably limited mass appeal.

So how will the iPhone fare in the Middle East come launch time in early-2008? No doubt it will prove a hit with the local Apple faithful, but these are few and far between compared to most other regions worldwide.

Apple has consistently struggled to gain a foothold in the Middle East, and the iPhone appears an unlikely panacea to this problem. The company will also face huge challenges in replicating its international business model in local markets. The concept of subsidised handsets marketed in exclusive partnership with network operators has proven an abject failure in this region, which leaves Apple with the hard sell option of marketing unlocked handsets at full-price in limited numbers.

Tying the iPhone to the iPod is a savvy marketing move on Apple's part. Yet, while the iPod metaphorically changed the way the game was played, given the commercial challenges facing Apple in the handset market it remains to be seen whether the iPhone even deserves a place on the first team.

On another note, this month marks my last as editor of

. It's been a great 12 months and I'm proud to have played a role in establishing the mag as the CE industry's pre-eminent B2B publication. I thank you for all your support and look forward to catching up sometime down the track.

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