Thursday, September 06, 2007

The i in iPhone

By Stanford Matthews
Blog @

Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store. Details are still being worked out and will be posted on Apple's website next week. Stay tuned.

We want to do the right thing for our valued iPhone customers. We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple.

Above is the only part of Steve Jobs' Open Letter to All iPhone Customers that you need to see. The remainder of the brief letter is just some silly fill that executive types feel compelled to include so they do not feel so dumb apologizing in public. But this is just another episode of consumers being dumb and corporate executives following suit albeit for different reasons.

In the article below from MarketWatch, Apple's stock price dropped over six percent in the Wednesday/Thursday trading. Steve Jobs may have a winner on his hands and there were obviously enough idiots wanting idiot phones. But for a guy who has pulled off some incredible achievements, he also appears to possess the ability to shoot himself in the foot. Maybe the early wars between Gates and him still haunt.

The move has put pressure on Apple's stock, which fell more than 5% Wednesday and continued to trade down on Thursday. The shares closed trading Thursday down nearly 1.3% at $135.01.

There's another post or two around here somewhere dealing with the iPhone. Don't take the reference of idiot phone the wrong way. Steve Jobs is talented. Apple can be an impressive company. The idiot phone has some interesting characteristics. But number one, its not like miniaturization was just invented nor display technology still using tubes.

Number two, the real idiot part of the equation not only addresses the 'stand n line' mentality but RE-addresses an old problem. The one that caused most people to laugh. The person who always had to have the newest things and have them first. The first premium paid was obviously the highest price for the product. And that premium also bought the purchaser first dibs on product flaws as well as the chance to convert that new technology into a boat anchor. Not to mention the follow up purchases for upgrades or newer models, etc.,etc.

The business world is now telling the gullible they need fast transactions for a fast world that demands a credit card. They don't tell you a cashless society may only benefit them. They also don't tell you they're competing with debit cards on that ad. The same goes with the idiot phone.

Remember when telephones had wires. Remember life before cell phones or built-in cameras or wireless internet or GPS tracking or traceless, disposable models? That is when the cost and quality of telephone service were the major complaints. When the phone was a phone the cost and quality of service were the big issues. Now wireless phones are the weapon of choice. Guess what the problem is? The cost and quality of service for making a damn telephone call.

It is done over many years and usually targeted at the younger or gullible demographic. Once they lure you into secondary features the price increases follow and the old problems never get solved. Who needs less expensive, quality phone service when you can get all these cool extras?

The technology gets released in tiny increments to milk the market. The sheep create demand and continue the cycle. The best products and services at the best prices that provide the best balance of profit for business and satisfaction for consumers rarely appear.

Without the announced price reduction so soon after buyers swarmed for the initial release of the iPhone, the customers would still be fat, dumb and happy. Steve Jobs indicated the apology idea was born after 'hundreds of emails.' Maybe, but one might think the sale of any product would generate more than hundreds of complaints. That aside, Jobs decides to keep the discounts in place but offer rebates to current customers. The deep discounts already moved the company's stock down significantly in two days. A case of dumb all the way around.

That is why the i in iPhone stands for idiot. Do they offer text messaging so you won't notice when the wireless internet portable music camera phone no longer allows you to talk to someone? Sure, laugh now. It's coming.

1 comment:

  1. You nailed it Stanford! This is my favorite line “And that premium also bought the purchaser first dibs on product flaws as well as the chance to convert that new technology into a boat anchor.”