PriceSCAN Blog

Cupertino has decided that independently developed iPhone apps will be web-based, meaning they can be created, tested and demonstrated on almost any computer the can run Safari. This now includes XP and Vista machines, immediately and vastly broadening the potential pool of developers. Further, legions of iPhone users surfing the web with Safari will only encourage site designers to optimize their pages for Apple's browser, which in turn could allow Safari to gain market share among all web users, especially given the availability of Safari for Windows. That greater Safari adaptation makes iPhone web surfing more attractive, spurring sales, and thus the virtuous circle Jobs & Co. surely dream of becomes complete.
There are a few challenges on the way to realizing this rosy vision. The iPhone uses AT&T's Edge cellular, which is slower than competing 3-G networks. The iPhone's Wi-Fi capability may not completely make up for this; handheld browsing seems a bit less untethered if a hotspot must be sought out to speed one's downloads. And there's the issue of the iPhone's touchscreen. Slick and innovative, to be sure, but early word indicates it takes some time to get the hang of typing on the flat screen. (My guess is, if the screen works well, at least the texting young masses will adapt. After all, typing on a clamshell cell is no joy, and using your finger in place of a mouse opens up a whole new spectrum of potential applications).
Perhaps the biggest question regarding the iPhone's impending launch is the effect of its steep price, reportedly $499-$599 in addition to the signing of a two-year contract with AT&T. How many people will kick their Blackberry addiction to take that deal? How many parents will indulge their tech-savvy offspring?
Jobs has been known to launch products whose high price point outweighed impressive technology and design – I'm showing my age here, but remember the Lisa? The NeXT? To justify a multi-hundred dollar premium over existing cell phones, the iPhone is really going to have to bring it, and that means being a lot more than an iPod with a dial tone. The Safari strategy seems more than sound, and early iPhone buzz is quite good, though slow Edge-based data transfer is said to be a fly in the ointment, Yet until consumers are actually presented with the opportunity to buy, the viability of Apple's pricing will be uncertain. In the weeks following the iPhone's scheduled June 29th launch, we'll again explore the question Steve Jobs has been putting to the marketplace for more than two decades:
What price cool?