A Tale of Two Launches
Two major product reveals over the next seven days promise to give Apple a good pre-holiday shake-up. First, Amazon on Wednesday will likely reveal a tablet device, presenting a new competitor to the iPad that may be more dangerous than previous contenders. Next week, Apple's own smartphone event, officially scheduled for Oct. 4, will bring forth a new generation of iPhones.
09/28/11 5:00 AM PT
Eager iPhone users got one step closer to laying hands on the latest generation of the smartphone as invites to an Oct. 4 press event went out on Tuesday.
Graphics on the invitations show four typical iPhone icons -- a calendar date showing Tuesday the fourth, a clock displaying 10:00, a map that points to the Cupertino campus, and an alert for one phone call. Underneath, the phrase "Let's talk iPhone" are displayed. It's perhaps a little meatier and more direct invite than the ones associated with previous events.
New CEO Tim Cook will lead the presentation, and the announcement has thrown a bucketful of gas on the many burning rumors surrounding the phone's launch.
Some Apple watchers speculated this week that Apple wouldn't just be launching a next-generation iPhone, but would also have an enhanced iPhone 4 product, something like an "iPhone 4 plus," available for consumers.
"The best insight we can go on is to look at the strategy they've applied in the past, and that is to take the previous generation product, alter it a little, and offer it at a lower price point," Alex Spektor, analyst at Strategy Analytics, told MacNewsWorld.
It's possible the company considered making changes to the iPhone 4, such as taking out some of the memory to cover a reduction in price, or altering the antenna design that caused service problems and negative publicity when the device first launched. That phone would presumably be sold at a lower price, and the next-generation product would be the premium priced, all-new model.
"The biggest challenge for them in continuing to implement that strategy would be to make sure that the new phone is different enough. If you compare the iPhone 3GS and the iPhone 4, they have the same screen size but the 4 has a much higher resolution and the case is dramatically different. Because of that they didn't risk cannibalizing sales of the expensive phone," said Spektor.
The rumor mill has produced an abundance of speculation regarding what those changes could be. The company might announce a thinner design, keeping in line with industry trends, or it could present a change in the size of the screen.
"The size has been unchanged since 2007. The rest of the industry has gotten much bigger as far as display. About a year ago a four-inch screen seemed gargantuan, now we have 4.7 inch displays coming later this year. For Apple, a 3.5 inch display is probably starting to look a little behind the time," said Spektor.
Apple didn't comment on any of the possible changes. Invites did confirm a different rumor, though -- that it will take place on the Cupertino campus instead of the Yerba Buena Center for the Arts in San Francisco, the spot where former CEO Steve Jobs famously introduced new gadgets in a black mock turtleneck and New Balance shoes in the past.
The switch in venue coincides with Jobs' departure as CEO, but it's unlikely the move has anything to do with that. The campus would be more intimate and localized, and the Oct. 4 announcement date coincides with Oracle's OpenWorld conference, which will be held from October 2-6 in San Francisco's Moscone Center.
It's also being reported that Facebook will make an appearance at the event, showcasing its official iPad app and an updated app for the iPhone. The app has apparently been ready since May, but tension between the companies led to delays.
iPad's New Threat
While Apple may be hot in the mobile space as the next iPhone launch creeps closer, its iPad division may be sweating over expectations that Amazon will on Wednesday release an affordable Android tablet.
Apple supposedly reduced fourth quarter orders by as much as 25 percent from its Taiwanese manufacturers as the rumored Amazon tablet, supposedly launching as the Kindle Fire on Wednesday, comes closer to its debut.
Rumors, leaks and testimonials from sources who claim to have used prototypes have surrounded Amazon's foray into the tablet market, yet the company has yet to officially confirm anything. That's expected to change Wednesday morning.
Since its debut last year, the iPad has stood as a formidable, almost unconquerable opponent to anyone else entering the relatively new tablet marketplace. Though expert reviews say competitors like the Samsung Galaxy Tab, other Android tablets and HP's short-lived TouchPad match or even beat the iPad in certain hardware specs and functions, Apple's sleek design, expert marketing and loyal user base have been too much for its adversaries to overcome.
That could change with Amazon's alleged tablet. Most tablet users now are early technology adopters who bought one of the first tablets from a brand they know and trust. As the category becomes more mainstream, though, tablet users will include consumers eager to purchase what they might view as an updated Kindle.
"Amazon is already a trusted digital media name. People are downloading books at an increasing rate, and a tablet is kind of the next logical step where people can add and download video and audio content," R.J. Hottovy, analyst for Morningstar, told MacNewsWorld.
The other factor Amazon could have going for it is price. While some companies have launched tablets under the belief they could market a little-publicized product at the same price as an iPad, Amazon's tablet will reportedly be sold for US$250 -- half the price of a base-model iPad 2.
"With its scale, Amazon can practically give away these tablets, which is certainly a selling point," said Hottovy.
Unlike some other tech giants who've ventured into the tablet space early, Amazon could also have the advantage of learning from others' mistakes.
"Amazon is a smart enough company. They know that to compete it has to be a breakthrough product, and this one sounds like it's going to be pretty revolutionary once we know some more of the details. They bided their time a little to observe customer preferences and found ways to optimize their digital content," said Hottovy.
The optimism surrounding the product doesn't mean Amazon's doesn't have a tough road ahead, however.
"I think Amazon's tablet could be a viable number two in the tablet space. But I don't think you're going to supplant Apple overnight -- that's unrealistic. Apple's got a wide following and sales have been strong as well," said Hottovy.