5 Reasons I will NOT buy an iPhone

As I watched the keynote live and looked at the flash demos on the Apple site, it occurred to me….

This phone is not for me. Why? Because I am a business person and a techie.

SO WHO WILL BUY IT? : Consumers that have money to spend that will look at the price of buying a fancy phone for $200 and a Nano for $249 and seeing the rest as “coolness price premium”.


I came up with 5 reasons this phone is not for business people or the techie crowd, of which I am both.

  1. NO 3G – This one I just don’t understand. Business users and techies need it because they surf the web and use it for e-mail and attachments all day. Just having EDGE is going to keep ALOT of people away. Especially consumers that that want to buy iTunes songs over the air. People will want to use this phone with their computer as modem and EDGE will not cut it.
  2. NO Corporate e-mail access - Just IMAP and POP is NOT OK STEVE. People who use the kinds of devices use Blackberry Servers and Versamail to access exchange. If you guys would fix iCal so it would connect and sync with Exchange I might be willing to deal with it for the time being.
  3. NO 3rd Party apps - The whole point of having wi-fi is to install Skype and the need for office applications. Widgets are great dude, but we need apps that make us productive. Developers are your life blood and if you want any chance of killing competitors you need to have apps available like Palm and Windows Mobile does. For goodness sake this phone is crying to open PDF’s Period.
  4. NO GPS – I can already pull up Google maps on my Treo. I hate my Treo, but what would make this a killer device is GPS for location based services (LBS). This is first phone that would actually make that market take hold.
  5. NO Removable Battery - Most business users who have phones, especially smart phones carry an extra battery to swap out on the go. This thing is supposed to have 5 hours of talk time but if you are using this all day as a business person, it will die on you before you get home.

All of this will come, but not tomorrow. However…

Apple thinks 10 million people will buy this phone by the end of 2008.




  1. Apple fanboys and fangirls – 500,000 units
  2. Consumers thinking about buying an ipod and hate their phones: ~ 500,000
  3. People that need a really good reason to leave Sprint or Verizon: ~ 1,000,000 (probably alot more but can’t afford the iPhone AND the cancellation fees).
  4. Phone freaks that love to be first – 250,000

So puts us at the number of units for the U.S. at 2,250,000 X GLOBAL UNIT FACTOR of 2 and you get a total of….

4.5 million units sold by the end of 2008 by my best and VERY UNSCIENTIFIC ESTIMATE.

So where will the missing 3.5 million units come from? iPhone 2 launched at Macworld 2008 that will have all the stuff I complained about earlier in this post. This will get the mass market to adopt, the business users to switch and everyone the sidelines thinking about it to make the plunge.

Look how long the iPod took. Everyone thinks it was overnight but to really become a success took about 3 years (2004). I suspect that the iPhone will take that long as well.
Apple is the one company that is the prime example of a “fast follower”. They watch everyone else, release something, learn from their mistakes and innovate even more.

In all fairness, there are two great write ups of this contrarian view that I share but they beat me to press so I must give credit for their speed and sharp analysis. They are Ars Technica and Paul Kedrosky.

At least I know I am not alone in seeing through the “Reality Distortion Field” of Steve Jobs.

2007 Predictions – Web 2.0 Landscape

The whole web 2.0 is just so over. Everything labeled 2.0 is stupid and it is a short term mistake because now that you have versions you won’t have long term innovation.

Here is my two cents on the market for 2007:

Digg – They have set off a revolution but the hype is going to peak. Netscape actually has better news and is more relevant. Make money or sell soon.

– Arrogant Founder, turns down $1.5B offer because he thinks its worth $8B. People are just wanting this to implode. I have one word for you – Friendster.

– MySpace will offer paid content or new revenue share models. As many people say that Web 2.0 is an after market for Google, media sites and design shops will become an after market for MySpace. We will see a whole new set of companies specializing in “MySpace consulting”.

Office 2.0
– This area will make some incremental headway as the apps get more sophisticated but the trick is going to be offline use.

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2007 Predictions-VC Market

As I get back in swing of blogging after a few months off, starting the new year with a predictions entry is a good way to start.

I thought I might do this topically to keep things organized. This is also going to be separate into easier digestible posts. Let’s get started with my outside looking in thoughts on the VC market.

Overall Venture Capital Markets
Deal flow will be steady but not bubble like. Increase and investment will grow at a steady 5-10% amount on average. As many VC’s continue to invest with a herd mentality, look for lots of “green investments” in clean technologies. Software will increase but media will be the darling after the YouTube exit. I believe that trends in social networking like Social Shopping, Social Search and Social Commerce will take it to the next level. Funding and M&A activity will be heavy.

More funds will go international. The amount of deal flow in the US is fine but those looking to make great strides will be going to India and China. This is supported by the NVCA survey (downloads pdf file) courtesy of the VentureBeat site.

The Carlyle Model becomes more popular. There are only so many companies that Google, Yahoo and Microsoft will want to buy. Carlyle Group has made a name for itself as a conglomerate and there will be more of a “Keiretsu revival” where instead of in the 90’s when people invested and then tried to tie them together, companies will form in order to buy established companies that will work well together. Why try and create another Yahoo when you can buy 15 companies that together make an even better one?

The IPO market will be almost back in full swing. The housing market will continue to crap out so people will be looking to put their money in the market again. This means IPOs but it doesn’t mean bubbles. People are smarter these days and companies will have to really be making money and have a real plan otherwise they should hope to be acquired by Google or a Hedge Fund.

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