Two years later . . .**********
From: Dan BDate: January 17, 2009 11:50:55 AM PST
To: matthewlynn@bloomberg.net Subject: Respectfully, I think your conclusions about the Apple iPhone are decidedly wrong. *****************************
Jan. 15, 2007: “I have marked my Apple iCal for January 15th 2009. On that date you will receive another e-mail from me. Two years from today it will be evident who was right”
Dear Mr. Lynn:
As promised, two years have now passed since your article on iPhone … I’ve re-attached your original article just below my Jan 15, 2007 e-mail to you. I stand by the subject line of this e-mail. I would appreciate your authorship of another article to correct the record.
On Wednesday, January 21, Apple will announce their Q12009 earnings. During this call, I expect Apple to announce that they have blown past their original goal to sell 10 million iPhones by 2009. How many iPhones did Apple sell in full year 2008? 13.7 million! If you include 2007 iPhone sales Apple sold over 17 million iPhones by the end of 2008.
~ Dan Butterfield
For further reference, see:
- Apple to become #1 smartphone maker by 2013
- Apple iPhone mobile Web market share surpasses RIM BlackBerry and Windows Mobile combined - January 08, 2009
- Analyst: AT&T defies economic slump thanks to Apple iPhone, tempts people to spend - December 04, 2008
- ChangeWave: Apple iPhone now #2 in U.S. corporate market share - November 20, 2008
- J.D. Power: Apple iPhone ranks highest in business wireless smartphone customer satisfaction - November 06, 2008
- Apple iPhone boosts AT&T’s wireless business - October 22, 2008
- Apple iPhone continues to exceed AT&T’s expectations - October 20, 2008
- Apple increases its lead in teenage mindshare; 30% plan iPhone purchase within 6 months - October 08, 2008
- NPD: Apple iPhone 3G is #1 smartphone in U.S.; AT&T big beneficiary - October 06, 2008
- Apple iPhone already leads Windows Mobile in North American market share, Q3 2007 - December 14, 2007
- Survey: Apple iPhone nabs unprecedented 92% satisfaction rating - August 16, 2007
- AT&T reports solid Q208 results highlighted by strong wireless growth, Apple iPhone 3G launch - July 23, 2008
*******************************
Begin forwarded message:
From: Dan B >Date: January 15, 2007 9:35:47 AM PST
To: matthewlynn@bloomberg.net
Subject: Respectfully, I think your conclusions about the Apple iPhone are decidedly wrong. ********************************
Dear Mr. Lynn:
I read your Bloomberg.com article today – “Apple iPhone Will Fail in a Late, Defensive Move.” Respectfully, I think your conclusions are decidedly wrong. I believe the iPhone is revolutionary and will usher in a new era in mobile communications. I’ve no doubt that you will receive a deluge of e-mail from Apple fans and stockholders (and I am both). I am also sure that many will be more strident in their opinions. I will keep my powder dry for now. I have marked my Apple iCal for January 15th 2009. On that date you will receive another e-mail from me. Two years from today it will be evident who was right. I will either offer you an apology or ask for a follow-up article admitting to the erroneous conclusions you drew in your original piece.
Today is Martin Luther King’s Birthday. And Dr. King once said “Change does not roll in on the wheels of inevitability.” There is nothing inevitable about the future for Apple’s iPhone. And there will be challenges ahead. But in my humble opinion, the iPhone is a game changing device and the future for Apple is amazing!
~ Dan Butterfield
Apple iPhone Will Fail in a Late, Defensive Move
By Matthew Lynn
Jan. 15, 2007 (Bloomberg) — Few products have been launched with such a blizzard of publicity as Apple Inc.’s iPhone.
To its many fans, Apple is more of a religious cult than a company. An iToaster that downloads music while toasting bread would probably get the same kind of worldwide attention.
Don’t let that fool you into thinking that it matters. The big competitors in the mobile-phone industry such as Nokia Oyj and Motorola Inc. won’t be whispering nervously into their clamshells over a new threat to their business.
The iPhone is nothing more than a luxury bauble that will appeal to a few gadget freaks. In terms of its impact on the industry, the iPhone is less relevant.
If column inches and airtime guaranteed commercial success, Apple would already have a global hit on its hands. For the past week, it has been impossible to open a newspaper or look at a Web site without reading something about the shiny new phone.
Certainly, it looks like a nice piece of equipment. The iPhone combines Apple’s iPod music and video player with a mobile phone as well as having wireless Internet access for e-mail. Instead of lugging around a phone for making calls, an MP3 player for listening to music, and a Blackberry for checking your e- mail, you can do all three on one device. Even better, you only need one charger.
It will be released in the U.S. in June, with a rollout to the rest of the world later, and will cost $499 to $599, depending on how much storage space you want. How many might they sell? Ten million in 2008, according to Apple Chief Executive Officer Steve Jobs.
Three Reasons
Not everyone is sold on the idea.
“The iPhone will not substantially alter the fundamental structure and challenges of the mobile industry,” Charles Golvin, an analyst at Forrester Research Inc., said in a report this month.
There are three reasons that Apple is unlikely to make much of an impact on this market — and why it is too early to start dumping your Nokia shares.
First, Apple is late to this party. The company didn’t invent the personal computer or MP3 player, but it was among the pioneers of both products. Yet there is no shortage of phones out there. There are already big companies that dominate the space, all of whom will defend their turf. That means Apple will have to fight hard for every sale.
Next, the mobile-phone industry depends on cooperation with the big networks. Phones — the high-end ones in particular –are usually sold with a network contract. The provider subsidizes the handset in the U.K. and hopes to recoup its money with ridiculously expensive charges for calls and data. Yet Apple has never been good at working with other companies. If it knew how to do that, it would be Microsoft Corp.
Network Opposition
On top of that, its rivals will be pulling out all the stops to prevent the networks offering iPhones. Sure, a big operator such as Vodafone Group Plc would like an exclusive deal to sell the iPhone in, say, the U.K. market. Against that, how much does it want to annoy Nokia — and what kind of incentives will Nokia be offering not to go with the Apple product? There will be lots of tough conversations between companies that know each other well. Apple will find it hard to win those negotiations.
Lastly, the iPhone is a defensive product. It is mainly designed to protect the iPod, which is coming under attack from mobile manufacturers adding music players to their handsets. Yet defensive products don’t usually work — consumers are interested in new things, not reheated versions of old things. Likewise, who is it pitched at? The price and the e-mail features make it look like a business product. But Apple is a consumer company. Will your accounts department stump up for a fancy new handset just so you can listen to Eminem on your way to a business meeting?
Fresh Competition
In many ways, that is a shame. The mobile-phone industry is becoming a cozy cartel between the network operators and a limited range of manufacturers. It could certainly use a fresh blast of competition from an industry outsider.
It may come — but probably from an entrepreneurial start-up somewhere. How about phones with fewer gadgets but better at making calls? Or with never-ending batteries? Or chargers that don’t weigh three times as much as the phone?
It won’t come from the iPhone. Apple will sell a few to its fans, but the iPhone won’t make a long-term mark on the industry.
(Matthew Lynn is a Bloomberg News columnist. The opinions expressed are his own.)
To contact the writer of this column: Matthew Lynn in London at matthewlynn@bloomberg.net .
Last Updated: January 14, 2007 19:28 EST
Matthew Lynn is clearly an idiot.