iPhone controversies: fact and fiction

The last couple weeks have not been kind to the iPhone’s early reputation. First there was word that developers working on Apple’s upcoming Leopard update to Mac OS X would be shifting to the iPhone, delaying the former product to help make sure that the iPhone met its release date. Then came rumors that the iPhone, despite the bolstering of its development team, still wouldn’t be out on the June 11 date previously believed to mark its availability. Finally, speculation that Apple is going to subsidize the iPhone. Given the flurry of negative press, we thought it worthwhile to go through the list and see if we can sort out the concerns.


The one that seemingly came out of left field was the delay of Leopard until October in order to help speed up the iPhone’s development. We won’t go into a full-on argument as to why this isn’t like the numerous Vista delays, except to say that Vista suffered largely from a lack of focus and poor communication and coordination among a massive development team. While the iPhone might be hitting some stumbling blocks, no one would suggest it lacks focus or that the problem is poor communication and coordination. The nature of an Apple product that does things that no other Apple product has done before means that it’s not always easy to guess how long development is going to take. Given that, we wouldn’t sweat Apple trying to hurry things along by reallocating their limited resources to a product that is the highest priority for the company right now.

One point we’ve also heard mention of, and which we think has a great deal of merit, is that Apple really doesn’t want to screw this up. Apple has promised us the world with the iPhone, and they know they only have one chance to get this product right. This might be iPhone 1.0, but they want it to have the polish of a mature, thoroughly-tested product.

As for the delayed release, the bottom line is that we don’t have an official, confirmed date for the iPhone. We can look at when keynotes are scheduled or when Apple has historically released products, but this is Apple, so expect the unexpected. Jobs could push back the release date just because he’s busy keeping it real, so until we hear otherwise, we won’t panic.

Finally, the subsidy hullabaloo. We’re not entirely sure what to make of this, to be honest. A few surveys have found their way to the web, sometimes showing incredible iPhone interest, sometimes showing disappointing numbers. Despite Apple’s protestations that they believe they can make an awesome product and not worry about the focus groups, we’re not buying it. Apple has almost undoubtedly studied consumer interest extensively in gauging what kind of numbers they should expect to sell at what price. We have a couple of ideas as to what could be going on. One possibility is that Apple is simply getting a little antsy about sales and is hoping to guarantee success with the first generation of the iPhone by lowering the price significantly. Another possibility is that Apple has negotiated something with AT&T to make it in their best interest to subsidize the iPhone. If, for example, Apple has a significant bounty off each new customer they get to sign up for AT&T, it’s possible it makes more financial sense for them to offer the iPhone more cheaply and do higher volume. There are certainly other explanations that are possible, but there isn’t reason to take this as an ill omen when it’s very likely just about financial prudence.

There are plenty of legitimate concerns about the iPhone’s future, but the sky isn’t falling here. When we’ll really worry is when Apple issues a statement denying that the iPhone is being delayed.

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