I recently upgraded my iPhone 3GS to the new iOS4. And after using it for the past 24 hours, I’ve found that it changed only a few things. Sorry Steve Jobs — it isn’t revolutionary! The primary change that I immediately liked is the folders or application organization capability but even that is limiting. The 5 screens of apps on my iPhone have been reduced down to only three. Unfortunately, folders can hold up to 12 applications at a time. With this design, a user doesn’t have to scroll to access more apps but it also means that the 16+ games that my boys play couldn’t fit nicely into their own little container. Granted, I have quite a bit more room to spare at the bottom of each application screen but things aren’t as tight as I wish that they could be.

Second, I learned that Pandora had to be upgraded in order for the “new” multitasking feature to work. As a fan of music, I’ve been using another application called Electric FM which allows me to listen to music in the background (as a stream within Safari) since February 2010. And there have been no freezes as recently reported by some iPhone users! So for me, multitasking really isn’t revolutionary. I guess that a side benefit of introducing this feature will be that some iPhone app developers will get called to upgrade their app and subsequently the iTunes app store will get refreshed.

My last disappointment about iOS4 is that iPhone 3GS owners don’t get to enjoy the new feature called FaceTime, which allows users to conduct video conferencing calls. Granted, marketers can’t really take advantage of this new feature but it is still cool in concept. FaceTime to me is evolutionary — it introduces an set up from a phone call — an untethered (but not to be confused with mobile) video conference for the masses, or so I thought. While my device is missing the rear facing camera, I expected my processor to be good enough to support the demands of this feature. I imagined that when I would engage in a FaceTime based conversation, I would be use only the forward facing camera on my iPhone 3GS which is no major loss. So I’m perplexed by Apple’s decision to not add this feature to my iOS 4 upgraded device. It definitely feels like Apple see me as a second class citizen unless it is a ploy to simply force convince me to buy the new iPhone 4. Really? It has had to come down to this arm twisting contest where I can only use the Knocking Live application?

Apple has decided to pick a fight with developers. In a recent change to the Terms of Service (TOS) for their new iPhone SDK, Apple has indicated that apps developed with third party software, such as MonoTouch, Titanium, or the upcoming version of Flash, will not be allowed. The new TOS also blocks the use of third-party analytics software, such as Flurry. The details of these changes are well documented by Joe Crawford and Erik Kerr. These changes basically mean that developing an iPhone app using a language other than the native iPhone language, Objective-C, or a C-based languages (C, C++), and collecting user data and device data is no longer allowed. NOTE: Some of the above companies believe that they are compliant with these changes and/or are actively seeking clarification from Apple (see Jeff Haynie’s blog post).

From my point of view, it will be incredibly disappointing for Apple to block apps developed with these third party platforms. While Apple claims that these platforms produce sub-par apps that violate user privacy, in truth they empower developers to create multi-platform applications using a single code base while tracking user behavior to better understand user needs. This kind of behavior by Apple seems downright anti-competitive, especially considering that Apple’s iPhones are in high demand. Some think that Apple is simply trying to ensure that their app store maintains its dominant position (credit to Raghu Kakarala). I’m of the opinion that Apple wants developers to get serious about Objective-C. The real benefit of this move is that these developers can create apps for the MacOS, not just the iPhone or iPad (or iTouch) and Apple can easily expand its reach.

While no can predict the future, I suspect that this move will backfire on Apple. In a recent report from AdMob, 70% of iPhone developers said that they were planning to code an app for Android but only 48% of Android developers plan to code for the iPhone. When considering the TOS changes and how Android development requires only HTML/CSS/JavaScript skills (basic web programming skills), I’m not expecting any attitudinal changes with iPhone developer. However, the number of Android developers that planned to develop for the iPhone will likely drop. NOTE: The survey is based on responses from about 100 developers which is a very small pool.

Apple is not the only company that realizes that it is all about developers. Microsoft did so years ago (see Steve Ballmer chanting “Developers, Developers, Developers” in video below). So the question remains — will Android developers agree to learn Objective-C or will they abandon the iPhone?

UPDATE: Hans Eckman pointed out that ZDNet had an article that indicated that Goggle is reaching out to iPhone developers to get them to port their apps to Android (source).

NOTE: Picture via TheiPhoneBlog.

Apple has done it yet again. According to the Q1 2010 results (source), consumers snapped up 8.7 Million iPhone devices this past quarter. While a few mobile market analysts feel that Apple missed their sales target (BTW, some expected sales to reach the 9 Million to 11 Million units mark), the growth of the iPhone still represents a healthy 100% increase in sales in comparison to the same quarter last year.

In my discussions with Marketers, I’m regularly asked whether iPhone app development or iPhone mobile campaigns make sense considering the dominance of rival smartphone devices such as RIM’s BlackBerry. There’s valid concern if you consider only the number of mobile devices but that number isn’t as important when you consider usage. While RIM currently outsells Apple in smartphone devices (RIM sold 10.1 million devices in the quarter ending November 28, 2009 whereas Apple sold 7.4 million iPhones in about the same period), the iPhone accounted for 60% of page views AND 75% of mobile revenue at the top online retailers this past holiday season according to Omniture (source). So while BlackBerry devices are more prevalent, users avoid using this device to browse the web. This decision is likely based on the poor web browsing experience. And Marketers that are considering the accessibility of their website should optimize it for the iPhone.

So Marketers that want to interact with the largest group of mobile users should first focus on the iPhone platform — nothing else compares. But besides usage, Apple provides plenty of additional reasons for why the iPhone platform will also win in the long run:

• The current quarter’s iPhone unit sales numbers exclude the 55% year-over-year growth in sales of the iPod Touch. The iPod Touch is a Wifi-enabled mobile device that supports many of the iPhone applications. The iPod Touch user segment represent a group that is not bound by telephony service but are still connected (likely to be a younger demographic).
• Sales growth was driven by strong global demand. This implies that marketers can now expose their application/campaign or brand to an international audience (while facing the challenges that come with such a relationship).
• With the introduction of the iPhone 3GS, demand for the iPhone has spilled from the consumer market over to the enterprise market. Apple reported that 70% of the Fortune 200 are either deploying or piloting the iPhone. While marketers may have previously focused on the business to consumer or B-to-C market segment, they now have an opportunity to create applications that address the needs of the business to business or B-to-B market.
• Apple continues to invest heavily in customer service, whether it is through training of mobile carriers on device or one-on-one coaching of new customers at their 283 stores (currently present in 10 countries). This is a critical tactic for Apple to attract and service an older demographic of users that may not be as comfortable with touch-based technologies.
• The numbers did not account for the  upcoming product introduction of a tablet-like device. This highly anticipated announcement is expected tomorrow but the value of this news is that Apple will give marketers yet another device that will support mobile applications. The segment of the users that select and use this device is still unknown but it is potentially a new group of untapped users.
• Lastly, Apple has completed two recent acquisitions: music streaming service Lala and mobile advertising platform Quattro. Both represent the company’s continued future-looking view on revenue generation and demands.

Apple seems to be benefiting from a positive feedback loop. While the iPhone does have its flaws (it is not a perfect mobile device!), Apple has built an elegant smartphone unit that is extremely user-friendly. Additionally, iPhone users regularly promote their smartphone to other non-users in their social circles so the masses are choosing iPhone when deciding to go mobile (source). For brands that are still on the sidelines or ones that are only focused on the alternatives (which is a mistake; source), there’s no better time than now to jump on the iPhone platform bandwagon.

A rumor started to circulate early yesterday that Apple and Microsoft are engaged in discussions over the displacement of Google search on the iPhone. According to BusinessWeek (source), Apple is considering using Bing as the search engine on the iPhone. The reasons that the authors gave for this move included:

• This was a financially motivated decision. Microsoft was offering Apple a bigger revenue slice of the advertising pie for incorporate Bing than Google.
• This was an effort to thwart Google’s recent jump into mobile. It seemed that Google was moving in on Apple’s territory with their introduction of the Nexus One device.

While some may buy into this rumor, there’s very little reason to believe it. Here’s why:

Apple is in the business of designing beautiful devices with exceptional user-experience for the consumer market. Google has dominant position in the web search market. Google reached this point by creating a simple, user-friendly search engine so having Google Search on the iPhone makes for a perfect match. While Google may not want to share more of their search revenue, they’ve bowed to the pressure of News Corp owner Rupert Murdoch when he proclaimed in November 2009 that Google was stealing his paid content (source) and that he would switch to Bing if he had no other option.

Regarding the competitive threat, there are two reasons that Apple may not be worried. First, John Paczkowski of AllThingsDigital wrote about a rumor that Microsoft is planning to release a Zune Phone in the next couple of months (source). In case you’re wondering, this rumor originally surfaced back in late 2008 (source) but this is the FIRST time that there’s thought that the phone will be pink. Currently, there’s no proof that Microsoft or any other phone/mobile OS marker is going to magically recapture Apple’s market share with their mobile offering. This rings true considering that Nexus One sales estimates reached a paltry 20,000 in the first week of offering according to mobile analytics service Flurry (source). If the Zune rumor is taken as fact, then Microsoft is a rival to Apple as much as is Google so there’s no real rush/need to switch.

In my opinion, it feels more like Apple is playing a good game of chicken with Google and Microsoft is just caught in between.

Earlier this year, the Wall Street Journal released an iPhone app called the iPhone Mobile Reader. The iPhone application allowed users to access premium content that was only available to paid print and digital subscribers for free (source). But as of October 24, 2009, content is no longer free.

I spoke with the online circulation desk and learned that WSJ.com digital subscribers now have to pay $1 per week or $52 a year to access the content via the iPhone Mobile Reader. Print subscribers can access the content for free while non-subscribers have to pay $4 a week.

It should come as no surprise that the Wall Street Journal has decided to charge for their content. A report this week by the Audit Bureau of Circulations showed that newspaper sales have dropped by more than 10% in the past 6 months in comparison to the same period last year (source). There are two other major factors that are making matters worse:

• Newspapers are seeing a slide in advertising sales (Gannett recently reported a 28% drop in advertising).
• Subscribers are accessing their news content online. They are also expecting to access that content for free, like they currently do with video content from the major television networks.

As a fan of The Wall Street Journal, I can understand the newspaper’s desire to squeeze a few more dollars out of their shrinking pool of subscribers. However, I’m disappointed that they have decided to tack on a “convenience” charge to access their content via the iPhone, especially if you’re already a digital subscriber. Why can’t they simply use my WSJ.com credentials to authenticate me and give me access to the content that I’ve already paid for? While I can use my current credentials and mobile Safari browser to visit the WSJ.com website, the experience is just not user friendly. I think that it is absurd to pay a premium twice to access the same content.

I’m hoping that this experiment will follow the way of NBC’s futile attempt to improve the bottom line by having Jay Leno at the 10 PM timeslot.

Financial information for publicly traded companies always provides a wealth of information, especially if you’re searching for clues as to where the technology is going. That’s why I love looking at quarterly earnings announcements from big technology companies, like Apple, IBM, Google and Microsoft.

Last night, Apple announced their 4th Quarter 2009 earnings and reported that their quarterly revenue hit almost $10 Billion dollars. [If you're trying to gain some perspective on these numbers, you should consider that Microsoft recently posted revenue of $13.1 Billion for the same quarter (which ended June 30th, 2009).]

I ran across a few interesting stats in the earnings report and the analyst call transcript:

• 7.4 million iPhone handsets were sold in the past quarter, a rise from 5.2 million iPhones sales in the prior quarter.
• Nearly 21 million iPhones were sold in the fiscal year, which ended in September 2009.
• There are more than 85,000 applications for the iPhone in the iTunes store.
• iPod sales were down nearly 8% for the quarter to 10.2 million units.
• iPod Touch sales also grew strongly during the quarter, up 100% year over year.

What does this mean to Technologists?

POINT #1: Apple is in a dominant market position.

They’ve reached this position via the introduction of the iPod and the iTunes Store. Over the years, everyone and I mean everyone (eg: Amazon) has tried to develop an interface with music library/music store capabilities but none have been able compete with iTunes.

POINT #2: Demand for apps in a packed iTunes apps store remains strong.

Soon after the introduction of the iPhone, Apple established a Developer Program that allowed technologist to create custom applications for the iPhone platform. The program required developers to pay a fee to distribute their application in the apps section of the iTunes store. The apps were valuable to iPhone users because they could personalize their device and be more productive (eg: I can check my Starbucks card balance and the weather while listening to my favorite song). But Apple also limited the number of apps by instituting an application approval process that required new apps to be vetted before they were made available to the public. By restricting the iPhone platform (that is in wide demand), they further fueled the fire of marketers who wanted to interact with these iPhone device users.

POINT #3: Exclusivity agreement with AT&T has driven iPhone innovation.

Apple launched the iPhone in the US by establishing an exclusive relationship with AT&T. While the relationship has received plenty of criticism (source), the exclusivity agreement has benefited Apple in that they were able to focus on a single platform and deliver innovative features for that platform. They avoided marginalizing the features of the iPhone by not having to deal with integration issues that come with having to support a device on the networks of multiple carriers. Additionally, the infrastructure investment has driven AT&T to improve their customer support by providing a more robust network for a smart phone devices.

BOTTOM LINE:

Apple provides a growing platform with a broad user base. Developers that are considering mobile applications will first need to build for the iPhone if they want to have the broadest reach. But because of the fierce competition, developers have to recognize that their app has to stand out in an already crowded market place. The good news is that Google and other competitors (aka, Microsoft) are courting developers to their mobile platform because they recognize the importance of mobile. One effective strategy that developers can employ is to look for alternate mobile platforms as a means of getting some initial buzz. By establishing a foothold in these platforms, Developers can build further recognition for their application on the iPhone platform. As part of this strategy, developers will have to utilize a platform that allows them to code their application in one language that can be compiled into a language that’s compatible with each platform. [NOTE: each mobile platform requires different programming languages/programming skills]. Otherwise, they will not be able to create and distribute their application in a timely manner.

I am quickly learning that I can’t live without my Apple.

I recently broke down and purchased an iPhone 3GS . I resisted to become enslaved to another electronic leash. For those that don’t know what I mean, it is the nickname for the BlackBerry that I carried for almost two years in my prior job. I saw it as a leash because of the blinking red light. For the uninitiated, it is the indicator light on a BlackBerry for new email messages. Like many others hip carrying users, I initially fell in love with my BlackBerry device because it allowed me to peak at my inbox. The pain of spending 5 minutes waiting on my laptop to reawaken from standby, log into the corporate network and fire up Outlook went away with a BlackBerry. But before I knew it, I was trained like Pavlov’s dog to look for the blinking red light. It was a vice that I was glad to be rid of for good, or so I thought.

As I debated the purchase, I wondered if my crackberry habit of checking my email would resurface. I knew that I was somewhat safe because Apple didn’t put an indicator at the top of their iPhone. Also, the iPhone has an option to turn off the sounds when a new message arrives in the inbox. It was amazing how I could be in control — I could set aside time to look at emails instead of stopping whatever it is that i was doing and rushing to my device to look who wrote me or what blew up (if there’s an emergency, they can always call!).

So at this point, I’m only a few days into this “experiment” but I’m already realizing why so many people are fans of the Apple brand. It managed to be totally focused on serving consumers like me.