Apple showing off a cellphone prototype?

The rumors have been flying this week that Apple is working on with Motorola on a cellphone, and yeah, there sort of are always rumors about stuff like this, but this week the volume has definitely increased significantly. We were pretty skeptical about this, so we started asking around about this, trying to figure out if this was anything more than the usual gossip, and we just got word from a highly reliable source that-jibing with the rumors from earlier this week-Apple has indeed been showing off a prototype for an iPhone (or whatever you want to call it), and that Motorola is one of the potential manufacturing partners. Doesn't mean that anything will ever come of this-even if they've built a prototype they could easily decide that getting into the cellphone business isn't worth the trouble.

[s @ Dec 19th 2005 12:07AM]

I just wonder when will apple start producing sanitary engineering (your-favourite-brand) and microwave ovens (moulinex). they would fit the style!

[WSTE_M @ Dec 19th 2005 12:07AM]

What do you think iphone.org is ? ;)

[JC @ Dec 19th 2005 12:07AM]

Yea, sure, Apple isn't interested in the phone marketplace.

Domain ID:D15354654-LROR
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Registrant Name:Apple Computer , Inc.
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Registrant City:Cupertino
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Name Server:NSERVER2.APPLE.COM
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[Fine James @ Dec 19th 2005 12:07AM]

Newton

[Baba Ganoush @ Dec 19th 2005 12:07AM]

Interestingly, when you actually go to www.iphone.org, it takes you to the Apple iPod Photo page.

[dcpmark @ Dec 19th 2005 12:07AM]

Well, let's play along with the rumour......if Apple did do a phone, would it be CDMA, GSM, or both? Any guesses?

[matthew @ Dec 19th 2005 12:07AM]

#6, as I posed (and blogged earlier still), I would see many advantages to Apple looking forward to a WiFi/WiMAX enabled iPod/phone/camera/organizer.

WiMAX deployment appears to be insanely inexpensive on a per-users basis due to the coverage area and relative expense of the equipment.

Building a nationwide network might be something Apple could easily justify, particularly if they could partner with an existing carrier or company with desires in this area.

In the last few months, WiMAX has lost a bit of its original luster, but the technology remains very appealing.

[gabe @ Dec 19th 2005 12:07AM]

I thought Apple publicly announced it was working with Motorola to produce an iTunes compatible phone?
http://www.apple.com/pr/library/2004/jul/26motorola.html

[Fred Grott @ Dec 19th 2005 12:07AM]

Apple is howing off a Moto phone powered with iTunes..all moto phones will be iTunes powered within 18 months..

you fell for the same rumour that has been floated around since 2002.. RUSS and RAFE bought it too..

repeat its not an iPhone but a Moto branded phonewith iTunes on it..

Moto never agreed to manufacture phoens for Appple they lciensed iTunes from Apple, however...

If your source is reliable then you should be able to produce the FCC application for such iPhone deivce,, where is it?

[iPod @ Dec 19th 2005 12:07AM]

cant wait to see this. hope it is a real apple phone and not just a moto with some itunes on it.

[Justin @ Dec 19th 2005 12:07AM]

"if Apple did do a phone, would it be CDMA, GSM, or both? Any guesses?"

I thought about this, and frankly they'd be stupid not to do both versions - CDMA for the US, Japan, SK, and GSM for Europe.

CDMA for the US specifically because if it was GSM only, they'd alienate most people in major cities where I'm sorry, but GSM service is crap, and gets worse the second you walk into, you know, a BUILDING. Also of course because right now the CDMA providers have the faster data networks.

Then again, Apple nuzzles with SonyE, who have abandoned the US CDMA market.

Erf. I hate GSM in the US.

[dcpmark @ Dec 19th 2005 12:07AM]

#7 - Yes, but I'm not sure Apple would need Moto to make the device you describe......putting in WiFi (or WiMAX) and adding a dial pad to an iPod-like device wouldn't be difficult......

[Jeffsters @ Dec 19th 2005 12:07AM]

Apple is NOT going to do a phone! I will say that Steve loves his cell phones but he's not going to let that cloud his business sense. Apple would have three different options, one would be to make a phone and an OS. BAD...lot's $$$$ too many players not enough money to be made in the space. The next was to make an OS and license to the big-3 you have three OS's out there now and trying to break in with a 4th would be VERY hard. The final option would be to partner with one of the big-3 and with licensing see a phone that supported Apple technologies aka. QT and now Itunes. That's the smart move and it seems Apple is doing that.

[Wiley @ Dec 19th 2005 12:07AM]

It would be simple to throw a cellphone chip in an ipod and add a handsfree mic to the headphones. The ipod already syncs addressbook entries, so just add in a numberpicker for unknown numbers.

I have to say though, it sounds like this is just a reference to the iTunes enabled phones that had already been announced.

[Callum @ Dec 19th 2005 12:07AM]

I don't run a business, never have- but, y'know in Sim City or Ceaser (remember that) when things we're going really well- no volcanoes or angry punters... You could take a break, leave the game running and go get a pizza... well after you came back you had loadsa cash- everything was swell, and you could drop the taxes. Then do something amazing- Now, can't apple just go get a margarita, come back and give us some price drops- that'd boost the Switch, wouldn't it? People think apple they think $$$, don't make them think apple = phones... it's a fad, and apple are soon to be butter over too much toast... half a peparami over a 4 cheeses. Just my thought anyway.

[Damian @ Dec 19th 2005 12:07AM]

I've been thinking a lot about Apple and the potential for them getting into the business of manufacturing a mobile phone. Here's the things to consider:

1. As I've written about before on my blog, the major mobile carriers are going to be hesistant to put a phone on their network that in any way compromises their ability to make money from data services or "harms" their branding. I can't see Verizon offering a phone with WiFi or WiMax (assuming a mobile version of WiMax comes into existence at some point), and, given my conversations with people in the mobile data area, I find it hard to believe that Verizon would allow Apple onto their network - particularly now that they've got the EV-DO networking going up - without taking a substantial cut from the music services. Now that could happen - especially given that Apple really doesn't make much money off of iTunes - so they might trade that for hardware sales which is where Apple has traditionally made their money.

Let's also not forget that, just about always, there is a carrier who will blink and grab the phone (particularly one from Apple) to get the customers. T-Mobile comes to mind in this area - they love to get exclusive or semi-exclusive relationships with phone providers.

2. On the other hand, as others here have pointed out, we know that Jobs always wants to control the total value chain on Apple's products. So how can Apple do that? By becoming an MVNO ala Virgin and offering the product directly to their customers. Partners for this could be Sprint or T-Mobile (although they have pretty much stated their not as interested in these deals anymore) - the only problem being that neither has a high-speed network yet that can compete with Verizon. But it seems to me that an MVNO deal would be a no-brainer for Apple - it would allow them to have the control they want.

3. Apple would still need to put together a great phone - but I could see them doing that with either Motorola or other ODM. The issue here, as others have pointed out, is battery life. On the other hand, what if the recent rumors about a Flash-based iPod were true - it seems to me that it would be a lot easier and more energy efficient to put a Flash-based player in the phone.

What's more natural than getting not only your phone, but also your service in a single bundle from Apple? People have commented that everyone hates their cell phone, but I think people also hate their cell phone provider. I think if Apple went this way they'd have a serious winner on their hands.

Comments welcome....more at http://www.mediathinking.com

[Peter Rojas @ Dec 19th 2005 12:07AM]

Why would there be an FCC filing for this phone? It's just a prototype, they wouldn't submit a phone to the FCC unless they were already launching production.

[Silence @ Dec 19th 2005 12:07AM]

The GSM/CDMA/UTMS/WCDMA question is really moot since all the major cell phone chipsets already support the MP3 codec, any that offers MPEG-4 video supports AAC, and WMA support is coming. So all we're really talking about here is an iTunes/iPod-like music application running on a cell phone, and whether the phone overall offers an iPod-like user "experience".

I don't see Apple designing its own cell phone hardware internally. Low-power RF applications like WiFi and Bluetooth on unregulated spectrum are one thing, playing nice at higher power on highly-regulated spectrum is quite another. Nokia, Samsung, Motorola, Sanyo, LG, etc., have spent a *decade* learning how to tweak the digital radio hardware (and another decade before that on analog) of a modern cell phone for maximum RF performance and battery life, and to meet very specific federal, industry, and carrier requirements. Those requirements are extremely stringent, and meeting them needs expertise Apple simply doesn't have.

Another factor no one here has taken into account is, what are the individual carriers' stances on an iPhone? The customers of the big cell phone vendors are the cell phone carriers, *not* the individual end user, so it's the carrier that needs to be appeased first and foremost. For them, the phone is the razor that sells the blades of airtime/bandwidth and services like ringtones and games -- why else do you think they subsidize the price of a cell phone to the end user to the tune of a hundred dollars or more when it's purchased as part of a two-year service contract? If audio is streamed to the phone on the fly, that's one thing; that requires a continuous use of bandwidth that can be metered and sold in some fashion. But downloading music from an online store is a one-time deal per song/album remarkably like downloading a ringtone (if a larger file, but higher data rates will mitigate that), something the carriers are presently making a small mint off of by partnering with various providers. They're going to want a cut.

Finally, some of the carriers like Verizon are moving to standardize the user interface of all the phones they offer *regardless* of the manufacturer to simplify technical support and improve brand awareness (the latest LG models they offer are a good example of this). For those carriers, an overall Apple-designed phone user interface isn't going to fly unless either it's restricted to a third-party application (which also offers the advantage of being able to roll it out easily to new phones as they're released), or the iPhone itself is restricted to being a niche product targeted at a small segment of the market (not unheard of, either, like the high-end camera phones with video capability right now).

All in all, I believe the most likely scenario at this time is that we see iTunes/iTMS show up as an application either preinstalled or available for download for phones from a variety of carriers and phone vendors. Since Motorola is the first licensee and builds phones for a variety of different carriers, it's difficult to speculate which carrier might get the software first other than it'd be a major one like T-Mobile, Vodaphone, Orange, Cingular, or Verizon. The carriers get a cut from Apple from every song downloaded from iTMS, and Apple gets a cut from the carriers for every copy of iTunes preinstalled on, or downloaded to a cell phone to make up for the lack of revenue from selling the hardware.

[Mike Beard @ Dec 19th 2005 12:07AM]

Could this be the flash based iPod that we've been hearing hints about?

If so, Mr Jobs wasn't entirely lying when he said that Apple would never make a flash based iPod. Through Steve's RDF a flash based iPhone is not even in the same category as the iPod.

[soundboy64 @ Dec 19th 2005 12:07AM]

In reply to post number 11

CDMA is old garbage, GSM is far out doing CDMA on all levels. Apple would definetly go GSM as you can tell by going to the iSync devicces, page, Apple knows where the inovaters in the cell phone market are, and is not with Verizon or Sprint, it's with companies like T-Mobile and the new Cingular, that use phones from good companies, not thiry different ways to make a silver flip phone, from sanyo, samsung, LG, etc.... Motorola is prime on theGSM side, and Sony Ericsson is god in innovation... Check your head.

[Piers Fawkes @ Dec 19th 2005 12:07AM]

So is this not an ad for the iPhone then?? See link at http://www.psfk.com/2004/12/iphone.html

[Silence @ Dec 19th 2005 12:07AM]

3GSM, the 3G successor to GSM, uses WCDMA (wideband CDMA) as the UTRAN air interface. GSM is actually older than CDMA, and was standardized on earlier by European and other foreign carriers, hence its widespread adoption. It would require a massive infrastruction upgrade for a GSM carrier to switch to CDMA1X (the competing IS-2000 standard) and vice versa, so a full convergence of the two architectures is unlikely anytime soon. Regardless, you're confusing the infrastructure architecture with the capabilities of the phone and the desires of the carriers. To the average user, the differences exist primarily in audio quality (because of the different audio codecs used by GSM and CDMA carriers) and coverage (again, carrier dependent).

GSM advocates like to point out that their phones run J2ME, allowing practically anyone with an understanding of Java to write and upload phone apps. Qualcomm's current MSM6100 and MSM6500 CDMA chipsets are fully capable of running J2ME, but most CDMA carriers don't want phones with it because BREW (a.k.a., Get It Now, easyedge, etc.), Qualcomm's solution, was deliberately designed to make it necessary to download the applications directly from the carrier ($$$)! It's all about the bottom line.

Any decision on a partnership between Apple and a carrier will be based on what each side will bring to the table from a market and sales perspective, with hardware only playing the part of the enabler for service -- CDMA and GSM really don't enter into it. In the US, the carrier could easily be either Cingular (testing 3GSM) or Verizon (testing CDMA1X-EVDO). Either infrastructure could supply the necessary bandwidth to make music downloads tolerably fast.

[Chet Parsons @ Dec 19th 2005 12:07AM]

Apple may have a hard time using the iPhone name. There's a VoIP co. that snagged it already. (www.iphone.com).

Aside from that, please let it be true, what ever the name. I'll switch from GSM to CDMA if I can have a phone that works with iSync without any issues. If it happens to be a flash iPod as well, then bonus for me.

Most of the mobile phones out there (and PDA's for that matter) are not Apple friendly. With the possible exception of Motorola and S/E, not one carrier is making new iSync compatible devices. And now PalmOne is ending development for Apple compatibility. I know this has a lot to do with Apple not updating iSync to work with new handsets adn PDA's, but it's a pain none the less.

With the right approach, this could be a very interesting niche of the mobile phone market. I hope it is true, and that it makes it to market before my S/E T610 bites the dust.

[pedro @ Dec 19th 2005 12:07AM]

couldnt they just be getting together for something like the memory for the anticipated flash ipod. motorola makes more then just cell phones after all.

[joelfinkle @ Dec 19th 2005 12:07AM]

Hrm.. I'm surprised that Moto would be doing this, seeing as they have their own line of MP3/WMA players, linked to the Billboard Hits music content.

[Diego @ Dec 19th 2005 12:07AM]

Any likelihood this would be a portable iChat client...?

[mvo @ Dec 19th 2005 12:07AM]

instead of a phone, apple, could you make a PDA instead? :) anyway, as for itunes in mobile phones, i don't quite fancy the idea. but oh well, we shall see!

[Dude @ Dec 19th 2005 12:07AM]

"I thought about this, and frankly they'd be stupid not to do both versions - CDMA for the US, Japan, SK, and GSM for Europe. "

Also in Europe CDMa is used..I come from Romania and we have a big operator of CDMA phones there. It's very popular. I hate GSM so I hopt more countrys in Europe will use this standard.

[lumbadoja @ Dec 19th 2005 12:07AM]

"21. Posted Dec 3, 2004, 5:09 PM ET by Piers Fawkes
So is this not an ad for the iPhone then?? See link at http://www.psfk.com/2004/12/iphone.html"

no i'm afraid not. perhaps you've heard of photoshop? seeing isn't always believing, but to sum up everything i've just read - i think a pda by apple would be somethin we'll see in the near future. i don't know much about gsm, cdma, etc. but these posts were insightful and all on the right track. one thing is certain, yes itunes will be on motorola phones within the next 18 months...as previously mentioned. no, an iphone will not happen - if you were apple, would you REALLY jump into the cellphone market this late in the game? i don't think i would. one more note, has anyone read or seen the pppppowerbook prank? i read that its old news, but i just saw it today...purely genious and hilarious! its about time scammers got a taste of their own medicine! see it here... http://www.p-p-p-powerbook.com/

[suhersh @ Dec 19th 2005 12:07AM]

Steve has done enough to leave a legacy behind... but finally the decision to make an iPhone will be finally a legacy decision. He is bound to be thinking *endgame* He would want to leave Apple strong in two fields- home entertainment and data. The first charge will likely be lead by the evolution of the mini, the second by some sort of a phone-pda device.

Okay, no one thinks Steve is ready to leave, but decisions about 20 years from now, given how fast tech evolves, are surely being made now.

I say an iPhone is not unlikely. The question, I think, is- will it be an input device ( and so be similar to a PDA), or just be a Calender display (which even the iPod can do)?