Apple Stokes iPhone Hype

Bloggers and reporters tracking mystery Apple boxes got a surprise today: The company didn't release the iPhone 2.0, now officially called iPhone 3G, as anticipated. The official launch: July 11. The timing assures another month of iPhone hype and loads of free publicity for Apple.

While I will loathe continued iPhone 3G megahype, I bow in praise of the marketing brilliance. I expect more cacophony as the launch date approaches and another mad rush of lines form in front of Apple retail stores.

The hype could have reached crescendo today and then petered out over the next month. Now the crescendo will increase for another month. I expect Apple to milk the marketing opportunity, which ought to be good for the share price, too. The stock closed at $181.61, down $4.03, presumably because Apple didn't release iPhone 3G as expected. Once investors get over their shock and hear all that hype, Apple will get another share boost (disclosure: I don't own Apple stock).

What a difference a year makes. When Apple launched iPhone on June 30, 2007, people lined up for the privilege of spending $599 for the 8GB model. When new lines form for July 11, the price will be $199. How's that for reaching a price to open up the floodgates of sales.

In the taxicab from the airport this morning, the driver asked if Apple would announce a new iPhone. He's from Israel and travels fairly often to the Middle East. The taxi driver definitely would like an iPhone, but not for $400. "Two hundred dollars," would be just right, he said.

A different taxi driver asked about iPhone 3G on the trip back to the San Francisco airport. He cooed at the $199 price, which he really liked. But he uses a local cell carrier that offers low-cost, unlimited minutes—but it's not GSM. He wants an iPhone, particularly for Web browsing and e-mail, but he can't afford to switch carriers. AT&T's unlimited iPhone plan would cost $70 more, and higher gas prices cost him $300 more a month than just three months ago.

I flew Virgin America (my first time) to San Francisco. The airline is at the international terminal, where there is a technology store that mostly stocks cell phones. There are more Nokia phones and gear in the store than I've seen anywhere. It says something about Nokia's global reach—a brand seen less often by Americans. According to Gartner, Nokia's worldwide cell phone market share was 45.2 percent in the first quarter, with 25.3 percent growth year over year.

The question sure to be asked many times during the great iPhone 3G-hype month ahead: What will the device's lower pricing and broader distribution mean for mobile manufacturers like Nokia? It's a good question. Apple's updated mobile phone will be $200 less than the one now pretty much sold out everywhere. By comparison, my Nokia N95 8GB sells unlocked from Nokia USA for $750 (much less, but still much more than iPhone 3G, from other sellers).

The iPhone 3G will launch simultaneously in 23 countries: Australia, Austria, Canada, Denmark, Finland, France, Hong Kong, Germany, India, Ireland, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Philippines, Portugal, Singapore, Sweden, Switzerland, United Kingdom and the United States. Apple plans to make the iPhone available in 70 countries, over the "next several months," CEO Steve Jobs said during his Worldwide Developer Conference keynote today.

What's uncertain: How many of these phones will be sold unlocked? I expected Apple to tier the pricing, with $199 for locked versions and about twice as much for the unlocked iPhone 3G. I got that wrong, maybe. Apple isn't done telling the world about iPhone 3G and, unfortunately, people won't tire of listening. Not me. I've already reached iPhone 3G exhaustion.

Related Posts:

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• Lessons Microsoft Must Learn from iPhone 2.0, Microsoft Watch, June 8, 2008
• 'You' Is iPhone's Secret Sauce, Apple Watch, June 6, 2008
• Windows Mobile's Good, Bad and Ugly, Microsoft Watch, June 6, 2008
• Methinks You're Wrong, Apple Watch, June 2, 2008
• It's Time for a .Mac Makeover, Apple Watch, May 30, 2008
• iPhone 1.0: Craiglist, eBay or Keepsake?, Apple Watch, May 23, 2008
• Post-Modern Gadget Moment, Apple Watch, May 14, 2008
• iPhone: Vodaphone Calling, Apple Watch, May 6, 2008
• Subsidized iPhone? I Wish, Apple Watch, April 30, 2008

Posted by Joe Wilcox on June 9, 2008 5:52 PM