More iPhone Hype

I’m going to put $50 on the iPhone not being as huge of a success as everyone says it will.

That’s right. Online gambling laws aside, the first person to respond to this post could win $50 (U.S.) if Apple’s iPhone turns into a stellar hit when it’s released on June 29. The Wall Street Journal just published another article about this piece of vaproware, and they’re claiming it’s going to take the world by storm when it’s released at the end of the month. But it won’t. And here’s why:

First of all, contrary to polls done by M:Metrics and the like, Apple faces a severe problem with regards to the pricepoint of their device. Right now, the two different versions of the phone are set to retail for either $499 or $599, higher than most other smartphones on the market right now. From what I’m told, this pricepoint will not be offset by customers who are looking to get into AT&T service. That’s right. Unlike, say, a Motorola Q, which is offered for about $100 when opening a new account on Verizon’s network, the iPhone will remain the standard fee no matter what.

Additionally, the phone is going to be offered only on AT&T’s network. That’s right. Even though they might be introducing high-speed data transfer service right now, the company certainly doesn’t have the history of offering broadband-style rates that other companies like Verizon or Sprint currently have. Will most users be willing to purchase a high-tech phone that can’t handle streaming video at speeds that don’t make it look like a Popeye flipbook? Time will tell, I guess.

Overall, the hype surrounding the iPhone seems very similar to a lot of the talk that surrounded the launches of Sony’s Playstation 3 and the Nintendo Wii in November of last year. Maybe there’s an element of cognitive dissonance going on here, but most analysts (including both Jupiter and Forrester) predicted that the PS3 would quickly become the de facto medium for console gaming and the Wii would become just a small pitstop on the way to Nintendo’s ultimate demise. That prediction was woefully inaccurate. I’m predicting that all of the media reports about the iPhone will follow a similar line. We’re going to see a lack-luster adoption of the iPhone come the end of this month. And I’m willing to put money on that.

Any takers?