Where is the “iPhone”?

There has been a lot of buzz about the agreement last summer between Motorola and Apple for a mobile phone that would also deliver iPod-like functionality and be easily connected to a PC and iTunes for music download over a broadband connection. Design firms like xnodesign have even put together fun prototypes of an “iPhone” like the one at left.

Got some bad news for ya. We’re not going to see it from Apple or Motorola. Looks like the mobile phone companies are telling Ed Zander and Steve Jobs to go pound sand since they’re perceived to be cutting-in-on-the-action of the wireless carriers business.

Last summer Forbes discussed the possibility that the wireless carriers wanted to sell music themselves and the current Business Week has a great article about what they’re up to and asks, “iPod killer?” when looking at this standoff. In an article in Fortune magazine from last year it was discussed that the new, hot Motorola Razor phone was not pleasing to the mobile carriers since all it did was voice and the carriers wanted to sell data services.

Data services are big business. According to Strategy Analytics, Inc., “(ringtones)…will become a nearly $9.4 billion business in 2008.” The carriers are offering ringtones for $1-$3 for all the boneheads willing to buy tiny little midi files and download them to their phone. The kicker? A tiny 30k ringtone downloaded is no problem over a wireless mobile connection. A 3MB song? Several 3MB songs? Ahhh….I think we got a problem here kids. To show you how excited some are about *just* this ringtone business, Rio Caraeff, VP of Universal Mobile Music has said, “…teenagers sometimes swap out ringtones as many as three to four times a week” and “Ringtones are all about personalization. They are self-expression.”

Don’t these people think that teenagers will figure out that an iTunes song is $ .99 and the stupid ringtone they’re buying is $2 or more!?!

I believe strongly that wireless companies have also pressured phone makers to remove Bluetooth or USB connection capability to the file structure of phones or for using the phone as a laptop data connection. Besides downloading phone photos, updating contact lists and address books with a PC to phone connection, one of the other useful things to do with such a connection is uploading your own midi files for ringtones (which is brain-dead-simple and I used to do all the time with my older Nokia 3650. There are even utilities to generate small midi files easily). There is no way wireless carriers are going to allow us to leverage this capability ourselves so they’ve slammed that door shut by simply not allowing phones with this capability on their networks or to be subsidized by them (killing its chances of adoption). They’re not going to allow Motorola or Apple to control what they perceive to be a new cash cow with ringtones and digital music, so the door is slammed shut on both companies.

Here’s yet another case of vendors (the wireless carriers) doing what is good for THEM vs. what is good for US.