(No Ratings Yet)Why iPhone users won’t flock to the Palm Pre come June
March 8, 2009 by Jack Svetlana
Filed under iPhone News, iPhone Talks
Palm investor Roger McNamee recently stated that when the phone contracts of the initial iPhone owners expire this summer, they’ll all be jumping ship for the Palm Pre – which should be shipping by then.
“You know the beautiful thing: June 29, 2009, is the two- year anniversary of the first shipment of the iPhone. Not one of those people will still be using an iPhone a month later. Think about it – If you bought the first iPhone, you bought it because you wanted the coolest product on the market. Your two-year contract has just expired. Look around. Tell me what they’re going to buy.”
First of all, this statement belies a common misconception about Apple owners – namely that their purchasing decisions are fueled by and are a function of their desire to be “cool”. While these customers undoubtedly exist, the iPhone has sold millions of units simply because its feature set leapfrogged all other competing smartphones in one fell swoop. Think about it – the iPhone was unveiled more than two years ago, and competitors are still struggling to play catchup. Apple doesn’t create hype to sell products. Rather, the ingenuity of the products themselves create the hype.
Second, let’s assume for a second that Apple users are as ‘cool consious’ as McNamee implies. Why, then, would they purchase a Palm Pre when the iPhone is still the yardstick for ‘cool’ in the smartphone market. Sure, the Palm Pre has gotten rave initial reviews, and it may very well prove to be a slick device, but the majority of this hype lies solely in the domain of the geeky who actually pay attention to what happens at CES. The reality is that the average iPhone user probably has never even heard of the Palm Pre. Also, keep in mind that as slick as the Palm Pre appears to be, it doesn’t really offer anything that new that will impress users to the extent that they’ll drop their AT&T iPhone plans. Sure, it has a qwerty keyboard, but if that was such an essential feature for users, then they would have presumably have already switched to another phone. What are you left with? Palm Cards? MMS? Cut and Paste? All cool, but features like cut and paste aren’t enough to sell a phone.
The iPhone is essentially a software platform, and as users inevitably become more tied to the content it holds, whether it be games, music, or movies, it’s extremely unlikely that a significant portion of iPhone users will all of a sudden decide to jump ship and sign up for a new 2 year contract with a different service provider. Signing up for a new phone in 2007 meant giving up your old phone. Now it means giving up an assortment of software and media content, which is undoubtedly a harder sell for a company like Palm to make.
Quickly, there’s an old story about Boston Celtics legend Larry Bird competing in the NBA 3-point shooting contest in the mid 80’s that comes to mind. In the locker room before the competition, Bird, ever the trash-talker, looked around and brashly asked the other competitors, “So which of you guys is playing for second place tonight?” If you’ll indulge me and my basketball analogy for a second, the iPhone is currently the ‘Larry Bird’ of smartphones at this point. Competitors are basically fighting over who’s going to win second place as the iPhone continues to nail shots from the corner with the multi-colored money ball.
Okay, back to reality.
Admittedly, the Palm Pre looks awesome, but implying that the Palm Pre will be an iPhone killer when it doesn’t even have a hard ship date is a bit delusional at this point. McNamee, though, seems like a good guy and really seems to genuinely believe in the inherent quality of the Palm Pre, and that’s something you gotta respect in a time when most companies are churning out phones that are just “good enough.” Palm, on the other hand, is actually trying to create a phone that is “better than”, and that can only be a good thing for the industry. The Palm Pre may well prove to sell like hotcakes, but if so, it’s highly improbable that that’ll be the result of defecting iPhone users.
Remon Lapid on Mon, 9th Mar 2009 9:07 am
Overall this is a good article, but I take exception to few of the comments made.
Most striking is the comment that Apple doesn’t create hype to sell its products. That’s a blatantly false statement. Apple made history for its brilliant strategy of creating hype for the iPhone. Which is not to say that the product itself isn’t remarkable. It is. Apple was brilliant BOTH in creating a great product AND in creating an historical level of hype.
I would also note that there is a logical fallacy in the argument that people won’t buy a product competing with the iPhone since the iPhone is the standard against which competing products are measured. At some point the present version of the iPhone will be outdone by another phone (whether built by Apple or some other company). I would not say it is impossible that the Pre might be that phone. That’s for the market to decide. Note that things can change very quickly, especially in the high tech gadget business. Today, unquestionably, the iPhone is king of the hill. But that doesn’t mean that it will be the king tomorrow.
I own a iPhone and I love it. But it does have some pretty serious problems.
First of all, the lack of a physical keyboard makes it impossible for it to be one’s primary email device. I know plenty of people who are fortunate to be wealthy enough to own both an iPhone and a Blackberry. And every last one of them will tell you that it is because of the lack of a keyboard on the iPhone.
Secondly, the lack of GPS is really annoying. I now keep two PDAs with me. My iPhone and my old Windows Mobile phone with built-in GPS. Yes, yes, the WM software is horrible by comparison. I take that back. It’s horrible even without a comparison. But I travel a lot and need a GPS to help me find the places I need to get to. I don’t have a choice at the moment.
Thirdly, Apple is enforcing the policy of only running one app at a time. This is a real nuisance. There are plenty of programs that I would want to run concurrently, and even my lousy WM phone can do it. Like IM. Like turn-by-turn navigation (maybe that’s why there isn’t a navigation program… can you imagine you’re near an exit and the phone rings? Boom! you just missed your exit… doesn’t happen with with my WM phone), and the list goes on and on.
None of this is to say that the iPhone is not a great device, but it does have its limitations.
What is very exciting about the Pre is that it appears to address all of these issues, and it takes the concept of what a smart phone should do to a whole new level. Or at least promises to do that.
If the Pre delivers on its promise AND Apple doesn’t update the iPhone to meet or exceed what the Pre can do, then it isn’t unreasonable to imagine that the Pre will become the standard against which all other smartphones are measured. Motorola was at the top of the heap with its Razr. Where are they now? I don’t doubt for a second that Apple has lots of goodies up its sleeve. But ultimately the fickle consumer will decide who is up and who is down by voting with their pocketbooks.
Remon
Remon Lapid on Mon, 9th Mar 2009 9:10 am
Correction: I mean to say turn-by-turn voice navigation, not “GPS”