Russell Beattie

Okay, let me say that I don't have any real information. But Ross Mayfield turned me on to this thought in his post this morning. I'm convinced that Apple will get into the mobile phone business within the next 18 months.

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?

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. He hates how hard it is to add contacts and make calls and he cringes at the web experience and the Java games, if he's even bothered to try them. He holds it in his hand during long trips and admires some things about it, but knows *he could do it better.* He knows that if Apple decided to make a mobile phone, it would be the most intuitive and elegant mobile phone in the world. And he wants that phone. And what Steve Jobs wants, Steve Jobs gets. Not much to argue here.

Okay, so the problems are many of course. Apple has no experience in the mobile business, and not only is the technology tricky to get right (we all know of popular phones that *suck* at sound quality and drop calls all the time, even from big manufacturers), but the business is cut throat as well. Getting your mobile phone out there means making deals with carriers and competing with giants like Nokia, Motorola, Samsung and Sony Ericsson. This is no easy trick.

Unless of course you partnered with one of those established players. Now this is the big question: Would Apple be willing to create a device which shares a logo from another company? Steve admires Sony quite a bit and any comparisions made between Apple and Sony seems to make him happy. However, I'm sure he sees them as a direct threat to his business, so I doubt he'll partner with them (even though Sony Ericsson phones have been the ones used in the iSync images for years now). 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 old Steve pal, 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?

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? I'm sure they could buy the same integrated chipsets from Texas Instruments or Qualcomm as anyone else does, develop the same wireless networking stacks they need or buy them from Linux vendors like MontaVista, and port them to a small version of OSX. What Apple can't build, they buy. That's what they did with the iPod - the OS inside was created by a company called Pixo.

But here's another prediction: Apple's penchant for not going with the status quo (think PowerPC chips) makes me think they'll go with CDMA technologies first - ostensibly due to the superior call quality and data rates. Apple calls up Qualcomm, asks for the chipsets and the software stacks to get them going, makes a deal with Sprint and Verizon (who'd be insane to say no) to launch their phones and poof: instant iPhone.

Suddenly Symbian and Microsoft have a viable competitor to their platforms. That is if Apple decides a smart phone is the right way to go - they may reject it as unneeded complexity. But let's assume they realize the value in creating a powerful mobile platform. A phone that's as elegant and easy to use as an iPod, but with advanced services provided by perfect integrated synching with Mac.com and your PC. 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. Over night, the high-end for mobile phones would evaporate. There'd be all the other guys fighting over the $99 or less freebies you get at your local phone shop, and then there'd be Apple lording over the premium mobile market. Much like they've done with the iPod over the past several years.

Do you see it? I bet a group at Apple is furiously working on this now, but running into a million headaches, so it'll be another year or more before it happens. Even experienced manufacturers like Nokia take 18 months to launch a new smart phone. Maybe it'll be announced during early 2006, ready for the market in Christmas at the end of that year. It would rock if it was sooner, but regardless, I'm convinced it's going to happen. Apple can't help but see the opportunities for a huge mobile phone hit, and Jobs isn't going to be willing to use a smart phone from any company besides his own.

Just my predictions... your thoughts?

-Russ