Tuesday, June 05, 2007

Clueless in the Valley

One of the things that's struck me now that I live in Silicon Valley is how broadly out of touch the entire region is with how normal people use (and ignore) technology. This note by Chris Shipley of DEMO is a good example:
Meanwhile, Amp'd Mobile, a Los Angeles wireless phone company that marketed its phone and mobile entertainment services to young, hip consumers, filed for Chapter 11 bankruptcy last week. Amp'd Mobile had raised more than $360 million in funding from several investos (including MTV Networks and Universal Music Group), but found itself more than $100 million in debt, including $33 million owed to Verizon Wireless for using its network and $16.4 million to Motorola for cell phones.

While I'm not suggesting that Apple is in trouble with its iPhone launch, I think lessons can be learned for mobile phone companies about figuring out the types of applications and services customers want on their mobile phones, as well as the type of customers you need to reach. While they differ greatly, Apple and Amp'd Mobile are offering customers basically the same thing – multimedia entertainment offerings on a mobile device. (Emphasis mine)
Let's be clear about this -- the iPhone is not about the standard content-lead services that have marked data-intensive mobile phone services to date, such as music, movies, pictures, etc. All of these have struggled, whether offered by carriers, virtual networks, or handset manufacturers. First and foremost, the iPhone is a better phone, making it easy to connect and speak with your friends. It has voicemail that works, conference calling that works, inbound calling that works, etc. Any multimedia services are easily ignorable at worst, and gravy at best. The fact that Apple is the one creating a cell phone that works, instead of Nokia, or one of the carriers, highlights how poorly the telco industry understands customer needs.

My main concerns about the iPhone: reception, battery life, and voice quality, the three most important things (still) for cell phones.

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