Behind Apple’s New Strategy For iPhone and iPod Touch
By Max Brenn
12:50, February 6th 2008
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Behind Apple’s New Strategy For iPhone and iPod Touch

While everyone wonders where some half a million iPhones could be, unaccounted for after the latest financial results of Apple and AT&T, the Cupertino company continues to push its latest gadgets: iPhone and iPod Touch.

In quite an unexpected announcement, Apple silently introduced a new version of the iPhone with 16 GB of memory, which will cost up to $100 compared to the 8 GB version.

iPod Touch has suffered a similar transformation. Apple introduced a new version, with 32 GB memory for $499. Despite the new introduction, the prices of the previous two versions were left unchanged; Apple is selling a 16GB model for $399 and an 8GB model for $299.

The new addition could be related to Apple’s newly announced service, iTunes Movie Rentals, which is compatible with iPhone and iPod Touch. But there are also other possible reasons behind Apple’s decision.

During his latest speech at MacWorld 2008, Steve Jobs presented iPod Touch, not only as a high-end iPod or a phoneless iPhone, but as a mobile device with WiFi connection. With a new SDK coming up later this month and the latest firmware upgrade, iPod Touch could become more than a multimedia player.

In fact, a teardown analysis performed in December by the research firm iSuppli revealed that there are significant differences between the two devices.

While the two models have a 90 percent commonality in terms of components - for example, Samsung's video/applications processor as key IC at their core, a chip based on an ARM microprocessor core, a power-management IC from NXP Semiconductors and the use of stacked on-package memory - iSuppli concluded that the iPod Touch is no iPhone clone.

iSuppli noted design departures for the latest iPod, declaring it “uniquely optimised to meet its form-factor and cost requirements.” For example, the iPod touch makes use of advanced packaging for its components not seen in the iPhone, including 0201 diodes and passive components in 01005 enclosures on the touch's WLAN module.

“This is the first time iSuppli has seen these components in a product we've torn down,” said Andrew Rassweiler, teardown services manager in a statement at the time. “Apple products always seem to push the envelope in terms of space savings, and therefore we often first see the newest, most-compact components in Apple products.”

Other differences include memory density and the PCB design. The iPod touch also employs a single PCB as opposed to the iPhone's modular two-PCB design. There is also a new set of components to support the iPod touch's Wireless LAN (WLAN) functions, according to iSuppli, and the location of the touch-screen circuitry is on the main PCB.

There were rumors that Apple intended to compete with gaming handheld devices such as Nintendo DS or PlayStation Portable, and iPod Touch, with its storage capacity could be a real rival for these devices.

With a SDK available for iPod Touch, it really is hard to estimate what the evolution of the new device will be.

As with the new iPhone doubling the capacity was a logical choice. Apple should generate more profit and the previous experience, with 4 and 8 GB iPhone has proven that the people want to have bigger storage capacities.

Indeed some might argue that $100 for 8 GB is a stiff price, but I’m sure that there are a lot of people willing to pay.

Apple’s decision may also have another reason. With its iPhone, Apple has entered in a real competitive market, in which new models are unveiled every month. As a result, Apple is forced to unveil new and improved versions at the same pace, in order to keep up with their competitors.

We can expect shorter life cycles for the various versions of iPhone. In less than a year, Apple has already discontinued the 4 GB version of iPhone and it’s very likely that the 8 GB version will have the same fate this summer, when it is very possible that Apple will cut again the prices or unveil the much awaited 3G version of iPhone.

With new versions and price cuts, it seems like Apple has a more aggressive strategy to promote its iPhone, in comparison with iPod. Different market, different rules!

One more thing…As Nokia has just launched its Ovi social networking service and Apple obtained in 2006 the trademark for Mobile Me logo, is there any possibility that the Cupertino company is working on a service where the iPhone and iPod users will share their photos, videos, playlists or podcasts? Take a minute to think about it!



© 2007 - 2008 - eFluxMedia
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