Research firm Piper Jaffray recently conducted a 200-person survey that shows unsurprising interest in an Apple “iPhone.” The firm said in an in-depth report provided to iLounge that the hypothetical product would be capable of serving as both an iPod and a cell phone, and be manufactured and branded by Apple (different than Motorola’s upcoming line of iTunes-compatible mobile phones). On average, the respondents said they would pay $255 for such a device.
“We believe a normalized interest level of 18% is enough for Apple to be considering such a product,” said Piper Jaffray senior research analyst Gene Munster, noting that the phone market is 13x larger than the MP3 player market. “We believe Apple has a powerful brand that can be applied to markets not yet addressed. If Apple executives are tuned into the strength of the Apple brand, we expect the company’s target markets to expand in the years ahead to capitalize on its namesake.”
Piper Jaffray wireless technologies analyst Mike Walkley believes that Apple could enter the mobile phone market through an Original Design Manufacturer (ODM) relationship and use a Mobile Virtual Network Operator (MVNO), but said “it will take time for the company to design products, strike deals with the wireless carriers in order to sell the products, and finally get the products approved on those networks.”
“An MVNO typically does not have its own network, rather it purchases minutes from traditional carriers and resells them to its own customers,” explains Walkley. “Virgin Mobile is one of the most successful MVNOs in the U.S. due to its unique focus on music and ring tones. Apple could build on its iTunes success as a MVNO… Assuming Apple has not started to work with an ODM or started to work on entering the mobile phone market, we believe it could take roughly a year to 18 months for Apple to potentially enter the market.”