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Weekly Column

What's in a Name?: That which we call an iPhone by any other name would sound as sweet.

Status: [CLOSED] comments (180)
By Robert X. Cringely
bob@cringely.com

There are a couple glaring mysteries surrounding Apple's new iPhone, announced this week at Macworld -- the name and the Internet connection speed. I'll get to Google in a moment, but first I'd like to cover these two points about the iPhone.

If you've been in a coma the last several days, you may not have heard about Apple's iPhone, which is a combination mobile phone, iPod, and Internet access device. It isn't in the strictest sense a Personal Digital Assistant or PDA, both because its Internet-orientation and whole Web 2.0-iness makes being a PDA passé, and because John Sculley invented that term. Steve Jobs, since he detests anything related to Sculley, who cast Jobs out of Apple back in 1985, will never make a PDA.

The iPhone is cool; the iPhone is neat; the iPhone is weird in a couple of ways. You know it isn't even close to being the most expensive mobile phone on the market, for all the grousing I've read about the price. My Nokia N.93, which was technically not available yet in the U.S. until recently, but could be freely found in the United States of eBay, costs substantially more at around $800.

What's weird about the iPhone is, first, its name, since iPhone is a registered trademark of Cisco Systems, which sells a variety of products under that brand. Apple has been negotiating with Cisco about licensing the iPhone name, so they can hardly claim ignorance of the trademark, yet this week they announced the product without such a license and of course Cisco filed a lawsuit in response. As the trademark holder, Cisco had no choice, because to not file suit would have been to not defend the trademark, perhaps making it more vulnerable to poaching by Apple.

What makes these trademark shenanigans all the more peculiar is that at the same MacWorld show this week Apple introduced another product called Apple TV, which it first demonstrated last year under the name iTV. (Just as an aside, one reader pointed out, "Look at the Mac Mini, the Apple TV, and the new AirPort extreme, all the same size and Bob's version of Apple's multimedia PC is stacking up, for less than $1,000.") Well, it turned out that Elgato Systems makes a product called EyeTV (pronounced "iTV" obviously), which is a line of Macintosh video capture devices -- some with tuners -- so Apple backed off and changed the product name to Apple TV.

So Apple changed its marketing, diluting its whole "iThis" and "iThat" naming strategy in deference to Elgato, a company they could buy with a weekend's earnings from the iTunes Store, but chose to go toe-to-toe with Cisco, a company that's bigger, richer, and just as mean as Apple any day.

If an iTV can become an Apple TV, why can't an iPhone become an Apple Phone?

I think it will.

Cisco's trademark infringement lawsuit, as well as its recent introduction of new iPhone models, shows the company has no intention of giving up the iPhone trademark to Apple. And since Cisco has a prior claim, just as many lawyers, and more money than Apple, one can only guess that Cisco will prevail. So why did Apple start this fight in the first place? Publicity.

I received a message recently from a reader who had been in direct communication with Steve Jobs about a related issue. This was before Macworld, but I still think it has bearing on Apple's state of mind:

"Some months ago my wife nudged me from my computer with the news that Steve Jobs was on the telephone. How could he be calling me, an unknown, semi-retired physician, in a rather small town? No blog, no column, no influence. True, I had written him a harshly critical letter (sent on paper by postal mail, by the way, rather than by Email) on two points: that banning Wiley books from Apple stores because a forthcoming Jobs biography presumably contained some accounts of his unsavory actions decades ago, and, also, that legal actions related to bloggers revealing rumors about forthcoming Apple products (purportedly "trade secrets") would engender hostility in the community of Apple-concerned independent aficionados.

"He replied first, that the Wiley boycott had not been his doing, but that of people in Apple's public information department, and that second, Apple's secretive manner of releasing information about its new products was carefully devised to gain maximum publicity and gained the company millions in free publicity that it would otherwise forego. Apple employees had, for money, provided information to the bloggers, and should be exposed."

There's a lot of juice here. It is absolutely in Steve Jobs' character to make such a call, by the way. I have received them myself. And he may well be correct that Apple's public information department, not Steve, threw Wiley titles out of the Apple Store. But it sure didn't bother Steve enough to reverse that decision, did it? And that bit about bloggers PAYING for Apple secrets? I have a hard time buying that unless he means they were paid in liquor.

But the main point here is Steve's acknowledgement that Apple secrecy creates free publicity. And so does this iPhone naming fiasco. Apple already has a fallback position created by the iTV-to-Apple TV transformation, so I'm guessing that sometime soon Apple will either pay Cisco a LOT of money for the name or Apple's iPhone will be transformed into the Apple Phone. Either way, every mobile phone user on Earth will have heard that Apple is now in the mobile phone business. Very clever.

This leaves us with the mystery of why Apple deliberately hobbled the cellular Internet capability of its iPhone, Apple Phone, whatever. As described this week, when the iPhone ships it will only work with Cingular's EDGE network, which is its 2G Internet service that maxes out at 170 kilobits per second on not just a good day but on a day that is so good it never happens. I've used the EDGE network and it feels like dial-up to me.

The iPhone is this amazing connectivity quad-mode device that can probably make use of as much bandwidth as it can get, so making it suck through the little straw that is EDGE makes no sense from a user perspective. But remember that the parties involved here are Apple and Cingular, neither of which is 100 percent allied with user interests. Cingular has a 3G network called BroadbandConnect or "MediaNet" if you buy Cingular's associated Cingular Video service.

And there's the problem -- Cingular Video, which is based on RealVideo, NOT QuickTime or H.264.

Apple wants the iPhone to get its content primarily through iTunes, ideally by syncing with a Mac or Windows PC. Apple doesn't like Cingular Video and doesn't want its customers to know it exists, much less use it. But it would be very hard to introduce a true 3G iPhone, have Cingular promote it strongly, only to say that it can't be used to view the mobile carrier's own video content. So instead Apple falls back to the slower EDGE network, which can support email and widgets and surfing, but which also forces iPhone users to get most of their higher-resolution video through iTunes, where Apple makes money and Cingular doesn't.

It comes down to an accommodation. Cingular wants an iPhone exclusive and is probably paying Apple money for that privilege. Apple doesn't want Cingular Video. So the only elegant way around that problem is to make the iPhone incapable of operating on the 3G network. If you watch his Macworld keynote you'll notice Jobs says that Apple may eventually make 3G iPhone models. Yeah, right: I'm 100 percent convinced that all it would take to turn an EDGE iPhone into a 3G iPhone is a firmware upgrade, if that.

Mobile phone carriers are eager for video to succeed on their 3G and 4G platforms because it represents a major new source of revenue. Apple's iPhone is the best handset yet for displaying that video. But Apple isn't going to allow this to happen without Cupertino gaining a substantial piece of the action. I'm sure discussions are taking place right now with Cingular where Apple is arguing that the carrier should make its video service iTunes-compatible.

The media and the market's ecstatic response to the iPhone will put strong pressure on Cingular, which has what is apparently a multiyear exclusive with Apple. If Cingular gives in, as I'm sure it will, the iPhones will suddenly become faster and have more features. And if Apple is correct, Cingular will then have the mojo to take them to the top of the U.S. mobile market.

And what happens when the Cingular exclusive ends? We can probably look to Europe in the months ahead for hints on that. Apple doesn't intend simply to enter the mobile phone market, they intend to dominate it, and ultimately to gain service revenue through iTunes, no matter whose phone you buy.

Sorry, I'm all out of electrons, so my big Google story will have to wait for next week, which is still within the scope of my 2007 predictions I might add.

Comments from the Tribe

Status: [CLOSED] read all comments (180)

iTV: the second major TV broadcaster in the UK is ITV, which is rather similar and very close in the same marketplace.

Actually, I'd like to see how Apple TV compares to the offerings from Elgato - I have an now obslete EyeHome (very similar to Apple TV - without HD); and that Elagto have EyeConnect to use with UPNP devices to stream content from your Mac (or PC).

Personally, I cannot see the benefit of replacing my EyeHome with an AppleTV for some years to come, until a) it can also play back other content b) support for UK standards c) price is reduced. I'm more likely to go the EyeConnect.

iPhone: As a UK person, I'm interested to see who they will sign up with in the UK and the rest of Europe. I guess that it won't be on a 3G network, but stay with the 2.5G technology for this release. But as Cingular overcame Verizon and T-Mobile then in EU will Apple go with T-Mobile or Vodafone (big investors in Verizon). Will they go with Orange or O2 (Part of Telefonica)? I doubt they will go with a MVNO such as Virgin Mobile. There is also a better comparison to be made against the SonyEricsson P990 which does not seem to be very prevelant in the USA. More competition both on functionality and price.

Vince | Jan 24, 2007 | 7:17AM

Isn't "iTV" a registered trademark in Britain? Those old 60's shows had that iTV "tower" logo on them.

Reminds me of the "Yellowpages" trademark dispute between Sun and BT.

Roger Ramjet | Jan 24, 2007 | 1:00PM

>And he may well be correct that Apple's public information department, not Steve, threw Wiley titles out of the Apple Store. But it sure didn't bother Steve enough to reverse that decision, did it?

It may well have bothered him more to not reverse it. It's likely that the public fallout for reversing his own people would be worse in the end than the decision they made. "Oh, by the way, you can buy that book again in the Apple stores. The people in my PR department are such jerks. I'm Steve Jobs and I approve this announcement." Yeah, right.

>And that bit about bloggers PAYING for Apple secrets? I have a hard time buying that unless he means they were paid in liquor.

What difference does it make how or even if they were paid? The commenter has a hard time buying something that is beside the point. The blogs' contributors stole clearly marked proprietary information and publicly exposed it. It doesn't matter whether it's Apple or IBM or Domino's and it certainly doesn't matter what the product was or how many people wanted the info or that Apple is "iconic" and therefore the public interest in its confidential plans outweighs its right to confidentiality -- all of which are among the bogus justifications that have been floated for the incident.

Buzz Dogyear | Jan 25, 2007 | 3:19PM