a machiavellian approach to iphone marketing

observation: People generally love the iPhone and are singing the praises of Apple, but at the same time they are blaming AT&T for terrible network performance

Something to imagine ... a possible reality that I have no direct evidence for ... but a curious possibility

Consider Apple and their frustration trying to work with mobile service providers a few years ago. The providers believe in absolute walled gardens right down to the hardware and most sneer at Apple - a mere computer company that is incapable of understanding how and why people use phones (pretty close to what Verizon apparently told Apple).

So Apple finds a provider with serious problems and, in return for a long term contract based on faith, is given real control over the device and its marketing.

The hope, of course, is the device will be a smash hit that will halt customer flight and even encourage news customers to come from other providers.

At the same time the provider is not upgrading its network aggressively as it prepares itself for sale.

now speculation...

Imagine a contract between Apple and the mobile provider that has network performance clauses. Apple can walk if the network does not achieve parity with other networks - or even surpass them. Similar non-performance clauses protect the cellular provider if the hardware flops.

In this case Apple, if they have a hit and can convince consumers that its intrinsic Appleness is good, has two mechanisms for US growth. If the device and network are great, people will flock to AT&T and both companies win. If the device is great but network performance is poor, it is possible that customers will blame AT&T rather than Apple and wish they had other network choices.

Once 3G iPhones are introduced into other markets a clear case can be made that the current network in the US is substandard and Apple could terminate its part of the agreement and sells phones to all providers allowing rapid growth.

___

This scenario is a case of entangling brand momenta (pardon the use of the term... but it is useful for discussion). The close pairing of Apple and AT&T enhances the Apple brand at the cost of the AT&T brand as customers sort out what they like and don't like about the product. The inclusion of wifi is a brilliant stroke by Apple that lets customers know that terrible cellular performance is the network rather than the device.

One can even imagine that Apple might suspect it is difficult to build out a robust network, but doesn't care as they have another mechanism for growth.

But, of course, this assumes Mr Jobs is machiavellian....:-)

If there is any possibility of this, it makes sense to look for a crash program at AT&T for building out a robust 3G network.

Comments

[BrianPhipps]

I like the concept of entangled brand momenta. (The world already has enough brand inertia.) It does appear that Jobs is in the driver's seat. He's now dictating the pace and direction of not just iPhone innovation, but mobile phone/device innovation. AT&T has lost the power to approve handset innovation, and without that gating capability seems destined to play the role of slow-footed partner and/or foot-dragging obstacle.