Why Coming Up With an iPhone Killer Will Be Tough…

2586687783_bc3cafd4db[1] Nokia recently announced its new 5800 Xpress Music, or Tube, as an “iPhone Killer”. Reviewers, however, disagree, mainly on hardware spec grounds – no touchscreen, S60 software issues.

What most reviewers seem to ignore is that even if Nokia (or Google, Sony, LG etc.) do come up with a device that matches the iPhone’s technical abilities (and I’m sure they have the required resources to do so) they’re still going to have a tough time competing with it.

Why? They way they sell and support their devices is very different than Apple.

When you buy an iPhone you have one company that control’s your entire experience with the device. From purchasing to ongoing operations and services its all ran by Apple that controls the entire product experience etc.
Apple bundles its iPhone with a set of services (AppStore, iTunes, Music Store…) that are tightly integrated with the device allowing easy consumption by customers which eventually is what’s driving Apple’s business.

Nokia, Sony, LG etc., on the other hand, sell the device through partnerships with different communication companies such as Orange Partner, which in turn, works with local sub-diaries. They rely on these partners for supporting their device and providing services to customers which often results in poor (sometime broken) customer experience.

Speaking at an Israeli GarageGeeks meeting, Steve Glagow, VP of Marketing Operations at Orange Partner VP mentioned that due to the fact they have to work with many regional and local partners, it takes more than 3 clicks and several screens for a user to install an application. Although he said their application installation rate is high (percentage of users who reach the application marketplace and end up installing an application) its a misleading measurement as most users will give up and never even reach the marketplace – only users determined to install an application will go through that effort.

Bundling your device with services is a winning strategy, not just for cellphones. Microsoft’s Xbox Live! platform is another great example on how bundling a device with online services helps increasing its value and perception.

Killing the iPhone will require more than just cool new hardware…

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5 Responses

  1. gjain81 says:

    Dude, Nokia never said this phone is an IPhone killer 🙂
    Don’t know if you have heard this podcast or not(http://twit.tv/163), but definately IPHONE kiler is pretty easy and will come soon.

    you do need just cool hardware and, and better faster running S60/Android.

    So Iphone is cool but what else? it is a mixed bag, it is probably to early to say it will be tough, i think it is easy, I could buy an iphone but i don’t because I like my N82 better, and Speaking of services, You get free software for S60 and Microsoft phones, including voice guided navigation! which you still don’t have for IPHONE.

    PS- this is personal, i just don’t like the IPHONE.

  2. gjain81 says:

    sorry the episode was 162 and not 163

  3. ekampf says:

    So, if I understand you correctly all you need is better hardware and build (better industrial designers), better software (make S60 actually work) and better added services (which Nokia will probably have to own rather than delegate responsibility).

    Oh yeah, and then you need your marketing to go against one of the strongest brands out there (not to forget its industry eco system)…

    Yep, sounds simple…

  4. gjain81 says:

    No Dude, Nokia and MSFT and Android can rely on individuals to provide all the apps people would need, since they have open platforms, not like apple, where a small startup may spend 6 months to develop an app and finally hear Steve say no!, this will not work with our carriers, or stuff like that :).
    As far as speed of s60 is concerned all new phones work great.
    Then you have great memory upgradability, and almost no sluggishness, etc etc, So i still believe the IPhone has a lot to catch up to :). Let’s see we will have this discussion again after a year down the line and see then 🙂

  5. Lidor says:

    In my opinion, and according to the Darwin evolution analogy to the evolution of brands, presented in the “Origin of brands”,
    marketing and branding the new phone as an iphone killer is bound to lead to failure.
    Creating a new category/sibling (divergence) for the brand (e.g. the ULPC for mobile computers) and providing a real alternative and difference to and from the iphone would be a much better strategy.

    Every so called “iphone killer” marketed would be thought of as an iphone fake, just like pepsi cola and RC cola are thought of as Coca Cola fakes.
    Even though some would argue that they taste better they’ll never catch up to Coca Cola.