Why is there no iPhone 5? (Overview of Apple’s rollercoaster week)

So many happenings in the tech world to start off this fall – perfect timing for me to resume my blogging here at It’s a HotPot! Welcome to the new domain! I am committed to this project and will also be sharing interesting updates through Twitter. So follow me at @ChHsiangOne quick note, for the ease of use and to cater to your interests, I will tag my posts with one of the following categories - TECH:: BUSINESS:: LAW:: ASIA:: RUSSIA:: TIPS::  That’s it, read on!

Last Tuesday, October 4th, Tim Cook announced the iPhone 4S from London, and 4G iPhones are now available to the U.S. through Sprint. See the transcript of his unveiling of the iPhone 4S. Despite it not being iPhone 5 and Tim Cook made the announcement (after replacing Steve Jobs as CEO in an unexpected announcement a month ago) the event went smoothly and settled worries and curiosity about Tim Cook’s ability to take over.

But why is there no iPhone 5?? Horace Dediu at Asymco gives a great analysis of the situation. In short, most people with iPhone 4 (around 50% of iPhone owners or 70 millions of them ) are still paying for their contracts and will not want to switch. On the other hand, the iPhone 4S can capture the people with iPhone 3s and “booby trap” people with mobile devices of other brands to switch to Apple. As for those who don’t yet have a smart phone, they can now get an iPhone 3. Call it business reality or whatever you want, but it is not about coming out with the newest technology before everyone else and at a faster rate than ever. Timing of business actions is a different ball game now that information about a company and its products is easily and immediately accessible. (A post about the new game of timing will be forthcoming! — I wish I knew how to make inserts like this a footnote…) The cost of access to information is very low, and additionally, the analysis of that information and then its cross-analysis is generated almost as quickly as the news get out.

Speaking of timing, Steve Jobs passed away the day after the release of the iPhone 4S. The police confirmed yesterday that the cause of death was respiratory problems from Jobs’ pancreatic tumor. Unlike how Apple timed the announcement of Jobs’ resignation as CEO to stall investors’ reactions, Job’s death was announced within two hours of his passing. Over this weekend, analysis of Steve Job’s contribution to the world overflowed the web. I understand the need and inclination to commemorate a great leader of our times. But it seemed like people were motivatedby a subconscious panic to glean the last lessons they could learn from Jobs’ life before the flood of new information pushes him out of their minds. Especially because Apple is a company known for its vision, and not just anyone’s vision but Steve Jobs’ vision, we will have to hold our breath to see how the model of succession will be carried out.  Successions of leadership in today’s companies are another project I am working on — so talk to me about it!

I wanted to share about three things that sticks out to me the most about Steve Jobs’ work in technology – 1) the weight of his impact comes from his ideology of technology, 2) he proved the price of design to the market, and 3) he was able to build brand loyalty and incentivize continual purchases in this industry.

Ideology of Technology

Steve Jobs made ideology the centerfold of Apple: beautiful, life-changing technology for the ordinary people (in other senses but for the price tag). Technology has always been deeply integrated with ideology; the entire genre of science fiction is about imagining a different world created by some technology. Every technology comes with some ideal of eradicating disease, ending pain, defending society from attack, or just of making life easier. But most of the time the message is implicit. In a recent article describing Jobs as the “secular prophet”, the Wall Street Journal writes:

“[Apple] improved markedly, unmistakably, from one generation to the next—not in the way geeks wanted technology to improve, with ever longer lists of features (I’m looking at you, Microsoft Word) and technical specifications, but in simplicity. Press the single button on the face of the iPad and, whether you are 5 or 95, you can begin using it with almost no instruction. It has no manual.”

This brings me to my next point.

Price of Design

Steve Jobs proved that there is significant monetary value for design. Though technology companies has always trumped one another based on functionality (and it is by no means less important today), the popularity of a product  today often hinges on the product design, an “intuitive interface” for the users, the ease of use, and etc. Technology today has become user-centric, as opposed to the traditional concept where the skilled has to “qualify” to use certain technologies in the work place. I am not saying that Jobs single-handedly brought about the era of user-centric technology, because the invention of the personal computers (which allowed people to use technology apart from work) makes this ideology possible. But Jobs chose to base his business on and explicitly advocated the principle ideology that design matters because users matter. Job proved to the market that people will pay for design and Jobs defined the playing field for his competitors and those to come.

Brand Loyalty & Continual Purchase

Most amazingly, in this industry where you can change brands with one simple click, Jobs has created a cult, a following…Brand Loyalty. Facilitated by transformations in the global market that have allowed the “ordinary” person to purchases luxury goods, Jobs’ ideology – that technology is life-changing and constantly improves life itself – further fuels the masses to make purchases after purchases. Again, WSJ writes:

“But the genius of Steve Jobs was to persuade us, at least for a little while, that cold comfort is enough. The world—at least the part of the world in our laptop bags and our pockets, the devices that display our unique lives to others and reflect them to ourselves—will get better. This is the sense in which the tired old cliché of “the Apple faithful” and the “cult of the Mac” is true. It is a religion of hope in a hopeless world, hope that your ordinary and mortal life can be elegant and meaningful, even if it will soon be dated, dusty and discarded like a 2001 iPod.”

The power of a technology that embraces ideology manifests through interesting extensions in the international realm. For Russia, Steve Jobs means much more than beautiful technology. Steve Jobs or Apple (practically used to be synonymous terms) is a symbol of status achieved through nontraditional paths. Success was built on the impressiveness of the technology itself, not political connections or corruption. The Moscow Times opines:

“Each time a well-heeled businessman scrolls through the contacts on his iPhone or a Duma deputy idles away a parliamentary debate playing Angry Birds, they are confirming Alexashenko’s insight on the example Jobs provides: that a fortune could be created ‘without oil, gas, high-placed friends; without kickbacks and embezzlement.’ One Moscow Times employee who recently found himself at a dacha party thrown by a prominent oligarch noted that all the guests were sporting an iPhone. Only the host was without one, carrying instead a dilapidated Motorola. That is perhaps the greatest irony of the Apple story in Russia. The products — created by such an idiosyncratic, famously single-minded individualist — are a must-have for aspiring professionals; only an established oligarch can afford not to have one.”

I continue to look forward to how Apple will continue on its path under the leadership of Tim Cook. But for now, thank you for your passion, dedication, and vision, Steve Jobs.

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2 thoughts on “Why is there no iPhone 5? (Overview of Apple’s rollercoaster week)

  1. So true! In Moscow, the well-heeled are seldom without their iphones. I wonder, however, if things would change were they ever to introduce the Blackberry in Russia. I mean, here in London at least, Blackberry and Apple seem to share the monopoly on smartphones.

    • itsahotpot on

      Hmmm.. interesting. I’m personally a HTC Android user and like the functionality, flexibility, and the fact it is priced more reasonably much better. But both in places like Russia and China, the Jobs-mania is insane!

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