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Mobile phone For quite a few years the Palm Pilot or Palm Treo were my productivity tool of choice. What I liked most was the availability of third party applications. After all these years, Apple has come from nowhere in the smartphone business to showing Palm how they should have done it — the "app store". As written here quite a few times, the availability of third party applications is the key strength of the iPhone. With 25,000 applications and nearly one billion downloads, Apple is hitting their stride. Palm is positioning their new "Pre" smartphone as the "iPhone killer" but I have my doubts. I am betting on Apple. The market capitalization — the value the stock market places on the company — of Palm as of the market close yesterday was $900 million. Motorola’s was $9 billion, Nokia’s was $45 billion, and Apple’s was $90 billion. The market is not always right but it usually is.
So I am sticking to my story — the iPhone 3G is fantastic. There are some issues but Apple seems to be solving them. The primary change in their strategy is that Apple came to realize that the iPhone is much more than a "cell phone" — it is a platform. The six basic elements of the platform are the iPhone itself, the network (AT&T in the United States), iTunes, the "App Store", MobileMe and, most importantly, the applications. With yesterday’s announcement of more than 1,000 API’s (application programming interfaces — these are commands that programmers can use to cause the iPhone to do something; sense a GPS location, sense that the iPhone was shaken, etc., it is a certainty that there will be many thousands more applications for the iPhone. To get an app you go to the app store. To get the app on your iPhone you have to have iTunes. You are tied to Apple. It is what the industry calls a "lock in". It used to be that when you needed a new cell phone you would go to the store of one of the operators and pick from a multitude of brands and phones. Now that you are hooked on various applications and the data in them you need to have a phone that can work with iTunes which is where your apps and your data are stored. Guess how many brands work with iTunes? Just one.
Apple’s new OS 3.0 coming in June will offer 100 new features including a search capability across the entire phone contents, cut-copy-paste, multimedia email, and landscape mode for all the apps. There will be a lot of smartphone competition from Palm, HTC, Dell, Nokia, Acer, and many others. The phones will all have great hardware features but it is the app store that ties things together. The other guys will be building their own app stores but chances are that they won’t do it as well as Apple. Apple knows how to make things easy and people seem willing to pay a premium for the ease of use and they don’t seem to mind being locked in. I will certainly take a hard look at the new Pre when it arrives but I doubt if I would give up my iPhone.