So I just woke up and noticed that Russell Beattie says that Apple's going to make a smartphone. They're not going to make a smartphone.

  • The smartphone business is already full of excellent products. Nokia is almost exactly like apple and has the same corporate character and sensibilities. apple can't compete against nokia. Nor can they compete against Sony-Ericsson, who make very pretty phones as well.
  • apple has no experience with making cell phone radios, and it's not trivial
  • cell phones are going to eat MP3 players anyway, but it's going to take some time, maybe a few years.

OK, now I'm going to look at Russ' post which I haven't read yet, and see if there's any arguments worth taking apart.

Why? Well, there's some logic, and there's also some amateur psychology involved as well. First it just makes sense. Apple is making a ton of money off of the iPod. They've already made that first step into the consumer products category and have seen how successful it has been for them. The iPod mini is really close in form factor to a modern mobile phone, so the experience in designing and building a new device like that could be used as Apple wades into the mobile phone market. Those are the logical thoughts. They're already making the iPod, a phone isn't that much of a leap (sorta), so it just makes sense, right?

Not yet.

The psychology part is this: Steve Jobs has a mobile phone. I'm not sure which mobile phone it is, but he's definltely got one. And he hates it. He curses at it every day. He hates it like he hated the original IBM PC.

Jobs probably has seen and may even have a Nokia phone (by the way, I've seen Jobs and actually at that time, his assistant carried the phone). Nokia has done as a good a job at a Smartphone OS (credit to Symbian too) as Apple could do.

I think the deal with Motorola to let them play iTunes music on new Moto phones is the key to this. Motorola is run by an Apple alum, is an American company known for its technology prowess, but doesn't have any competing products to Apple. It seems like a perfect fit. Apple iPhone, powered by Motorola technology. Can you see it?

I think the deal with Moto about iTMS was just an experiment. Motorola can't keep their quality up. Apple products all must have 100% perfect quality. No.

On the other hand... If little PalmSource can create new phones on demand for its new Cobalt OS from Asian white-label electronics manufacturers, then why couldn't Apple?

If I were to buy this scenario, which I don't, that's what Apple would do.

Add a little magic sauce like an integrated 4GB drive and iTunes integration, or something I can't even think of yet, and you have a massive hit.

And might very well kill iPod sales? How do you explain that?

  • another problem is that Russ says that the apple phone would run an Apple OS. That would not be OS X. So they'd have to buy an OS, license one (symbian???), build a new one, or expand the iPod OS. A smartphone OS is far more complex than iPod which is, for example, not open to 3rd Party development and doesn't have a JVM. This is highly non-trivial. Russ is talking about a massive software R&D effort that dwarfs iPod, drains resources from OS X.

It's not going to happen.