About that iPhone 3G “in 60 days” thing
Published: Tuesday, April 8, 2008
Nuance is an extremely important, but under-appreciated element of communication; our soundbite-heavy culture prefers quick, simple, and conclusive explanations rather than ones that demand thought or raise ambiguities. When is the next iPhone coming? “In sixty days” is the answer people want to hear—it gives everyone a chance to mark their calendars or set their countdown widgets with some degree of certainty. Last week, the Wall Street Journal’s Walt Mossberg obliged them, stating casually on video that the iPhone would go 3G within that timeframe. There was a rush to report the statement as fact, under the assumption that it wouldn’t have been said without certainty. But today, he retracted the statement, explaining that his number was just a ballpark estimate based on speculation.
As much as we like Mr. Mossberg, you might note that we didn’t post anything in our news section regarding his initial quote or the followup. The reason? Nuance. We’ve heard the same buzz about the next-generation iPhone that he has, but there was a subtle difference between what we heard and what people have been claiming over the last few days: “in 60 days” would mean that the 3G iPhone would be on the market by June 5 or sooner, but we’ve heard that the actual launch timeline is looser than that, such that Apple wasn’t making more than a two-month commitment to current-generation iPhone products as of mid-March.
Nuanced? Yup. What that wordy phrase means is that, come mid-May, all bets are off regarding whether Apple will be pushing the current-generation iPhone or a sequel. An announcement could come then. Or at WWDC in early June. Or July. Or August. As with all things Apple, a number of loose ends have to be tied up, and if they take a while longer to resolve, them’s the breaks. On a month to month basis, the company will continue to make decisions about manufacturing, selling, and promoting current-generation iPhones, and you won’t see the company telling people to stop buying today’s model until the next one is ready to order. That’s just not the way Apple does things. The only time the company pre-announces a product hugely in advance of release is when it doesn’t have something else to sell in the meantime—or when it miscalculates the actual release date because of engineering or manufacturing delays, as with Leopard, Apple TV, and so on.
So what accounts for the recent 8GB and 16GB iPhone shortages in stores? The answer is most certainly miscalculation, and probably the good type rather than the bad. As we saw with the iPod mini years ago, sometimes demand grossly and unexpectedly exceeds supply—with Apple products, this tends to happen with brand new releases rather than years-old products. Apple has spent the last decade making conservative decisions regarding manufacturing of new products so as to avoid the inventory buildups that plagued the company in the early 1990s, and with the current iPhone still in its first year of sales, it’s not a shock that the supply/demand balance will sometimes be off. This is especially true when the company has to decide whether to make more units of a product it’s about to discontinue.
Right now, the supply/demand balance is off in the other direction in Europe: the supply has exceeded demand, enough that T-Mobile is now offering €99 subsidized iPhones in Germany to entice customers to buy in. The catch: you have to sign up for a 24-month contract—quite a long time to be bound to the current-generation iPhone, right?—and the deal expires June 30, the day after iPhone’s first anniversary. Coincidence? Just wait and see.
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