Why Apple's iPhone sales aren't really that RIMarkable

By Ian Betteridge

For anyone who's followed Apple's fortunes over the years, the transformation of the company has been remarkable. And that's not just a statement about its finances – it long ago shook off the "beleaguered" tag of the late 90's – but also describes the core of the company's business.

Ten years ago, it made computers. Now it's the iPod company, and with the incredible results it posted this week, it's probably fairer to call it "the iPhone company". In a year, phones have gone from almost nothing to providing 39% of its revenues. No one else has managed to make this transformation from computer company to consumer electronics business so successfully. But not quite so successful as some web sites would have you believe...

To get an idea of just how big the iPhone 3G launch was it's worth comparing this quarter with the previous one. In the quarter which ran from April to June, Apple sold only 717,000 iPhones, as demand dwindled in anticipation of the 3G model and as it ran its own stocks down. This quarter, the company came close to trebling its previous record for iPhone sales, when in the three months leading up to Christmas 2007 it sold an impressive-sounding 2.3 million phones.

By any standards, this is massive growth. But if you take a look at the circumstances which surround it, it's perhaps not as surprising as it appears at first.

The first thing to consider is coverage. Officially, the first-generation iPhone was available in only a handful of countries, primarily the US, UK, France and Germany. Apple launched the 3G model in 22 countries on the same day, and is expanding this to over 70. This means that the number of people who could potentially buy an iPhone has jumped from around 500 million to something in the region of 2.5 billion. With a jump in availability that high, you're always going to get a big increase in sales.Continued...

Apple rivals try to equal success

By Chris Nuttall

Apple's rivals are making moves to match the runaway success of the iPhone platform with their own versions of its store for applications and games from outside developers.

Research in Motion announced at its first BlackBerry Developer Conference yesterday that it would launch an "application storefront" in March next year.

Developers creating software for smartphones are being invited to submit applications and content for inclusion from December.

Google is also revamping its Android Market and adding new applications this week to coincide with availability of the first phone built on the new operating system, the HTC G1. Both trail Apple's App Store, which launched on July 10 for the second-generation iPhone.

Steve Jobs, Apple chief executive, announced last month that more than 100m copies of applications and games had been downloaded in the first 60 days.

The increasing sophistication of smartphones and growth in size of the screen interfaces is turning them into PC-like platforms, where developers can boost revenues by producing mobile software applications.

Following the Apple example, handset makers are exploring how consumers can be drawn to phones by the number and variety of applications available.

Rim said yesterday that developers could set their own prices for applications but, at 20 per cent, it was taking a smaller cut than the 30 per cent Apple levied for approving and displaying App Store applications.

Rim added that it would provide carrier-customised on-device "application centres".

To calm the fears of business customers that employees might download undesirable applications, it said those who had deployed BlackBerry Enterprise Server software could retain control of which applications were downloaded.

"The new apple i phone had really set a new standard in the industry."