The Apple iPhone isn’t all that you’ve been led to believe.
That is the thesis behind a 106-page research report published in November by Strand Consult titled, “The Moment of Truth-A Portrait of the iPhone.” The report discusses, and works to debunk, what it calls the 10 most significant myths surrounding the iPhone.
While Strand Consult said it believes the iPhone has an attractive design and user interface and that Apple is a unique company that understands industrial design, it’s frank about the smartphone within the context of the mobile industry. The company stated in the report’s introduction, “We never believed that the iPhone was an opportunity for operators and we stated at a very early date that the closer the relationship an operator had with Apple, the worse business case they would end up with.“
The report continued, “We believe that there is a need for an objective view on the iPhone both regarding advantages and disadvantages, and in relation to whether the iPhone actually creates shareholder value for the operators-and not just for Apple.”
The 10 iPhone myths, according to Strand Consult, are:
??Ã The iPhone creates data traffic in a mobile operators’ network.
??Ã The iPhone helps operators to attract new customers.
??Ã The iPhone is good business for mobile operators.
??Ã The iPhone dominates the mobile services market.
??Ã App stores are a huge success that have revolutionized the services market.
??Ã There is money to be made in developing iPhone apps.
??Ã iPhone customers create the majority of online mobile surfing traffic.
??Ã The iPhone has a large market share.
??Ã The iPhone was the first mobile to launch with a touch screen.
??Ã The iPhone is a technically advanced mobile phone.
In its effort to disprove these statements, Strand Consult has gathered information from investor relations departments, as well as from operators. Its client base includes 160 operators, and it quotes the chairman of one as saying, “The iPhone effect is the effect that comes from moving our management’s focus away from the 99 percent of our customers that generate the cash flow that pays our bills.”
On Oct. 22, AT&T, the exclusive U.S. carrier of the iPhone, announced fiscal third-quarter revenues of $30.9 billion and net income of $3.2 billion. The quarter included 3.2 million iPhone activations, “with nearly 40 percent of the activations for customers who were new to AT&T,” the carrier stated in a news release.
Among its arguments in the report, Strand emphasized that the figure of 40 percent new activations means that “60 percent are [AT&T’s] own customers switching to the iPhone, thereby cannibalizing other AT&T product offerings … It is important that one does not become completely mesmerized and dumbstruck by the hype surrounding the iPhone.”
The free report is available on the Strand Consult site.