Will cellphones eat Apple’s iPod or vice versa?

“There is a digital land rush going on, driven by rapid advances in technology that make it possible to put more and more tools of higher and higher quality into phones. The recognition that talk is only part of the cellphone’s future — that it is becoming a personal window into an evolving blend of communications, computing and media — has the existing players in the cellphone market scrambling, and new entrants looking for a way in,” Steve Lohr writes for The New York Times News Service.

“Handset makers like Nokia, Motorola and Samsung are introducing the next generation: multimedia phones. The latest entrants, announced last week by Nokia, include a model that can hold up to 3,000 songs, and another phone that doubles as a high-quality camera and video recorder that can shoot and store an hour of video. Media companies — from Time Warner and Viacom to Google and Yahoo — are looking to the cellphone as a new market for their entertainment, news and search products, and software makers, led by Microsoft, have also entered the fray,” Lohr writes.

“The ascendant computer-media hybrid, Apple, plans to test the market in a few months with a music cellphone, designed in partnership with Motorola, hoping to extend its music business beyond the iPod,” Lohr writes. “Apple’s first step into the market, according to industry executives familiar with the company’s plans, will be a modest one — a phone designed to hold a day’s playlist of music, about 25 songs, which can be loaded from a personal computer or purchased from a wireless music store. The phone is being carefully positioned as an enhancement to the iPod instead of a potential alternative.”

Full article here.

MacDailyNews Take: At some point, as phones hit 6-10GB capacities, Apple will need to have an answer. Either an iPod that can place / receive phone calls or a mobile phone that has 10+GB and a headphone jack will suffice. And it can be good at being both a phone and music player; just look at the miniscule size of an iPod shuffle and some of the tiny phones on the market today. We’ll get this device eventually from someone (hopefully from Apple). And it’ll probably take pretty decent snapshots, too. Apple, get ready, here come the beginnings of your real competition. The good news is that the initial price for the Nokia is too high, 4GB is a bit too small (and doesn’t really hold 3,000 songs at a quality bitrate), Apple has the patent pending iPod Click Wheel, and Apple has a dominant market position.

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Bona fide Apple iPod killer? Nokia’s 4GB mobile ‘jukebox’ phone due by Christmas – April 28, 2005
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Motorola CEO Zander: Apple iTunes phone due ‘in the next few months’ – April 20, 2005
RUMOR: Apple’s iTunes Mobile 1.0 to be ready by June – April 20, 2005
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Motorola to unveil iRadio – PC to Mobile to Car Stereo service – April 18, 2005
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24 Comments

  1. I don’t listen to music on my cell phone, though being a PocketPC, it can play music. I like the devices separate. The iPod is for entertainment and distraction. The cell phone is for work.

  2. Not only that, but what about battery life? I don’t think many people will be happy to drain their battery playing music – especially when they have a call to make.

  3. Must agree with Thelonius. I don’t play games or anything like that on my phone because I need to save the battery for when I’m actually making a call. I may not be the ideal demographic that they are aiming for – not in the 16-25 age group. That seems to be who they aim the latest cell phones towards. I keep a cell phone for calling, and I keep an iPod for music.

    In a perfect world, I would have one PDA that was my organizer, phone and music player. However, it would need a helluva battery to be able to meet all of those needs without needing a charge every 2 hours. The other thing is that it would need to be a seamless box so that all of the components worked together easily and easily synched with my Mac. Finally, the functionality would need to be good. I don’t want to use a crappy interface to browse my music – that’s why I have an iPod.

  4. Independently from how we use cell phones/ipods now that is going to change as technology evolves and eventually some company will present something as great in that market as the ipod is in the mp3 player market.
    This could be a threat for apple because it offers record companies, etc… a different avenue to present their product and to regain control of pricing.
    Nevertheless i have faith that apple understands this and will be the one to introduce the superior alternative, hopefully evolving the great design of the ipod into a cell phone.

    MW- ‘pressure’ as in if steve doesn’t get on this he’ll definitely feel the competitive pressure!

  5. Time will come when Apple will seriously make iTunes AAC available as well as licensed iPod alternatives – but not until they have wrapped up an awful lot more iPod sales. At which point iTunes will take 90%+ market share and make greater profits than than iPods.

  6. The whole point is that Apple does NOT have a dominant market position. Nokia phones outnumber iPods by more than 10 to 1, let alone cell phones in general. Apple can easily loose this battle.

    The good thing, ofcourse, is that Nokia supports AAC.

  7. I do not want to waste valuable battery power on music when I need it for the phone. I want my battery to last as long as possible, and I am NOT willing to sacrifice one minute on music…

  8. I worry that Apple doesn’t “get” that it will generally NOT be consumers who select these phones but the cell phone service providers–Verizon, Cingular, etc. Apple has always been weak in selling to businesses, stronger in selling to individual consumers. But the cell service providers control 90-95% of cell phone purchases, by deciding which phones to “subsidize.” So for Apple to win here, they MUST have a way for these companies to make money off of digital downloads, even if they ALSO permit users to simply sync their phone with their iTunes collection on their computer. There’s no sign yet that Apple understands this.
    Very worried…

  9. No fault on the phone manufacturers but,

    Give me a goddamned phone that ACTUALLY works as a phone, not a friggin phone with all the bells and whistles. That means, good signal strength that’s consistent all the time and at all places. NOT something that works great in some, mediocre in others, and crappy in most. I want network capacity that doesn’t crap out during peak hours. I’m sick and tired of dropped calls in the middle of my phone calls. Focus on the quality of calls and calling capacity rather than stupid annoying ringtones and data services that don’t work.

    MDN keyword: latter, as in “Between a phone with MP3 and and iPod, I’d choose the latter.”

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