The long expected iPod phone – dubbed iPhone -  will be launched early next year, according to analyst Shaw Wu at American Technology Research (reported by Reuters). This prediction is supported by the Taiwanese newspaper, Commercial Times, which this week reported that the 12 million handsets are being built for Apple by Taiwan-based Hai Precision Industry Co Ltd.

While other manufacturers have already launched mobile phones with music playback capabilities (eg Motorola’s ROKR phone), I’m willing to stick my neck out and predict that the iPhone is going to be a hit. Here’s why:

1. iPod has been a huge success because it’s cool and stylish. It works just as well as a fashion accessory as it does a music playback device. My wife, for example, thinks her Nano is just so cute. Mobile phones have also become fashion accessories. Whatever else the iPhone will be, I’m willing to bet it’s going to look really cool, and people will love to be seen with it.
2. As a brand extension of the iPod, the iPhone makes perfect sense. iPod represents fun, mobility, youth and coolness. These brand attributes transfer across to iPhone perfectly.
3. And here’s the obvious reason; who wants to carry a phone and a portable player? The whole idea of portable gadgets is to free us up, not drag us down. Most people would prefer to carry just one portable device. Speaking of which, it’ll be interesting to see how “smart” the phone is. Wouldn’t it be nice to also ditch the PDA.

Just finally, I think it’s very interesting to compare Apple and Microsoft. Both ostensively personal computer companies (Microsoft software; Apple software and hardware); both facing the problems of market saturation and commoditization (most people have a computer, and most computers will do the job, as a general rule). Apple cleverly enters new markets where it can add value, while Microsoft seems to enter new markets where it thinks it can leverage its existing market share (eg social networking via Vista and MSN). 

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Entry was posted on Tuesday, November 21st, 2006 at 4:45 am under Apple, Cell phones, Media players.

Read more entries by John Pospisil.
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