RWW Predictions: iPhone Sales in 2008
This week's prediction is about (what else) the iPhone. We're asking: How many total units of the iPhone will Apple sell in 2008?.
For background, Apple sold 2.3 million units in Q1 2008 and 1.7 million units in Q2 2008. Today Apple announced it's already sold 1 million 3G units. In 2007 Steve Jobs said he expected 10 million unit sales in 2008.
The new 3G is twice as fast, available all over the world, and (for some people anyway) half the price at $199. So Jobs' 2007 estimate may even be conservative. What do you think - how many iPhones will Apple sell in '08? Click here to make your prediction.
UPDATE: Apple today announced it sold its one millionth iPhone 3G on Sunday, only three days after its launch on Friday, July 11. Here is the rest of its announcement:
iPhone 3G is now available in 21 countries--Australia, Austria, Belgium, Canada, Denmark, Finland, Germany, Hong Kong, Ireland, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, UK and the US--and will go on sale in France on July 17.
"iPhone 3G had a stunning opening weekend," said Steve Jobs, Apple's CEO. "It took 74 days to sell the first one million original iPhones, so the new iPhone 3G is clearly off to a great start around the world."
See also: Apple's App Store: 10 Million Downloads Later; and iPhone: The New Personal Computer
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Eventually more and more people will use it, however small screen and no keyboard makes it impossible for a lot of serious use. Actually IPhone has a pretty good experience for browsing the web. But is there anybody, who is regularly reading articles on an iPhone? 20 inches gives you a completely different experience.
The key is that it is mobile. So it can be exceptionally useful a lot of times, but clearly it is not a replacement for a good PC or notebook.
According to Engadet 1 million 3G iPhone were sold in the past 72 hours.
http://www.engadget.com/2008/07/14/iphone-3g-at-one-million-sold-and-counting-app-store-hits-10-mi/
I *should* be smack in the target market for this thing. I can definitely afford the iPhone, but the $900+/year contract is just too much. I could buy and throw away a laptop every year for that price. I haven't really researched what the contract rates will be worldwide, but I think that's really the clincher that will predict how well the device does. My guess is that a fairly sizeable chunk of the US market that is willing to fork out that kind of money to AT&T is in the eager-beaver group that will have their iPhones in the first few weeks. If they could get a rate plan that ordinary people could afford, it would be a whole different story.
I know it's still early, but I wonder what percentage of iphoner's have bought new ones replacing ones that they may have broken or lost. More than 50%?
I think if they were to hit 10M by the end of 2008, they should have at least gotten 5M at the half way point. Other manufacturers are coming out with competitive models. They had their chance to sweep the market, now they are just in upgrade mode.
The iPhone isn't competing against smartphones per se, it's competing against lifestyle devices. Much in the same way that Apple brought "cool" to the table back in 2002 with the iPod, RIM brought "status" to the mobile communication market. This is the iPhone's struggle.
Apple is in VERY unfamiliar territory here, where the portable music device and digital distribution business were vacant lots where a competent company could waltz in and start a game of stickball, the smartphone industry is littered with established names. The irony behind the big boys in this club is that none of them have learned from their mistakes. RIM created the blackberry because of essential e-mailing needs among executives. They've been playing catch-up with themselves since then. While this a wonderful position to be in, it leaves very little room for improvement. Then we have Motorola, Nokia and Palm who have all had roller coaster success since the early 2000's.
Motorola showed the world something that no one in mobile phone industry understood, and evidently from current marketing, still doesn't understand completely.
The cellular market is now full of extensions of self, not technological gadgets anymore. They struck a cord with their masterpiece, the RAZR, giving the cellphone users of the world a product to identify with. When was the last time you walked through your local mall and not notice the abundance of people with diamond studded phones, decals or at the very least florescent carry cases? Nobody wants to decorate something called the "N80" or the "SGH-i760". They want to carry something called "Blackberry" or "iPhone". I'd include the Moto-Q, but it's just plan ugly.
This is something Apple understands and is ready to conquer, the only obstacle is an industry giant that is refusing to move beyond it's original business model. We're looking at a "Vista effect" in the near future. Sure, the Blackberry Thunder promises great new functions, but the concept means old users have to re-learn their tried and true system for something new, why not switch out for something completely new? (remember the jump from 3% to 9% of mac users in the subsequent years of Windows Vista's release)
The only question is, whether or not Apple is poised to strike in this small window of transition.
It's not a question of how many original iphoners are replacing their old phones, but a question of how many were simply waiting for the second generation as to not get burned as an early adopter. Apple realizes this and is rightfully optimistic with the current 3G numbers. This is a far cry from struggling against a 90% market share, or creating a 90% market share.
This brings me back to my original point. This position is unfamiliar to Apple, being a leader in the industry, in place of toppling the biggest inmate in the yard. If Apple plays its cards right, it's a 10M+ unit count by 2009 (the magic consumer electronics number), if not, it'll remain a second place niche product until it's next iteration.