When Verizon Communications Inc. (NYSE: VZ) opened up Apple Inc. (Nasdaq: AAPL) iPhone sales to the phone carrier's existing customers two weeks ago, it sold more iPhones in the first two hours of preorders than it did of any other phone on a launch day. Some analysts estimate there have already been 500,000 total presales.
The sale continued last Thursday, when Apple and Verizon Wireless stores opened their doors at 7 a.m. to allow eager customers to pick up the latest iPhone, as the king of the smartphone market continues to reign.
This zooming interest in the iPhone shows smartphones are no longer just a luxury item for wealthy consumers, or a business tool for busy execs. Social networks, texting and anywhere/anytime access to the Internet have transformed them into a "must-have" device for mainstream consumers.
And smartphones are leaving the PC in the dust.
As researching firm International Data Corp. (IDC) declared in November in its annual report, "The PC-centric era is over." The firm predicted 330 million smartphones would be sold worldwide this year along with 42 million media tablets.
The mobile computing era is bound to offer some of the hottest competition in any industry. Apple's iPhone, Research in Motion Ltd.'s (Nasdaq: RIMM) Blackberry and phones running Google Inc.'s (Nasdaq: GOOG) Android operating system are fighting for market share. In the tablet world, Samsung, Dell Inc. (Nasdaq: DELL), Hewlett-Packard Co. (NYSE: HPQ) and Google are hoping to snag some of the spotlight from Apple's iPad.
Mobile applications are also gaining in popularity. The number of free and paid apps downloaded each month is soaring, creating a new industry for app developers. The most popular apps allow users to check news and weather, listen to music, read books, play games, and congregate via the Web's social networks. As these apps get more sophisticated, you'll even be able to count calories by scanning a bar code, play "name that tune" by recording a song on your mobile device, and check to see if your flight's on time.
Developer Little iApps has even blessed consumers with an offering called Confession, which walks Catholics through the sacrament, offering what the company calls "a personalized examination of conscience for each user."
But the mobile computing world, where endless information lies at one's fingertips, hasn't charmed basic cell phones out of everyone's hands.
In addition to the hefty sticker prices that many devices carry, the skyrocketing network use has forced telecom carriers to seek ways to finance the scorching increases they face in network maintenance costs.
Gone are the days of unlimited usage fees as carriers look to offset rising costs by restructuring pricing and slowing download speeds.
There's also the consumers who simply aren't interested in mobile-computing via cell phones.
This prompted last week's Money Morning "Question of the Week": Have you gone mobile? If so, how far? Do you have a smartphone and tablet? Do you find yourself using mobile computing more than your PC? Do you regularly use apps? If you aren't immersed in mobile computing, why not?
The following comments express readers' experience with the mobile era, as well as opinions on some of the most popular mobile computing products.
Going Mobile = Highly Overrated
I'm content using my laptop for now. I have enough problems typing on a standard keyboard, let alone a mini one that needs wickedly agile thumbs.
Much of this craze of smartphones I believe is fueled by the sophomoric need of today's adolescence of coveting what everyone else is perceived to have and need – a modern version of keeping up with the Jones'. Call me a Luddite in this one, but I perceive much of this industry as being a well-marketed and unduly created need that feeds on the weaknesses of the human psyche to not be left out in the cold. They're like every electronic device that's come before it, including washing machines with dozens of settings or stereo systems with infinite ways to adjust. I believe most people adjust using a few basic functions of any device and the rest is just left to waste, and almost never applied, except as some brief experimentation to guffaw at the miraculous ingenuity of one's newly acquired purchase.
The youthful world has been led like lemmings down this path of falsely believing that unless they are noxiously plugged in to the world at large, they will somehow lose much of their significance as functioning participants of the human endeavor. I for one don't really care to know at any given moment what my "homie" and neighbor are up to or about.
In a world where governments try to portray themselves as the solution to man's security, rather than the intrusive problem in most cases, I get increasingly discomforted by a population that is discontent to not mind its own business and must be plugged in 24/7.
– Mark S.
I love my iPhone and yes I am one of those users that has it attached to his hip…or, hand. Besides being the easiest way to check e-mail, it's my best bet for sports updates, which I usually check either when I'm out or on the train in the morning. I also have fallen victim to the Angry Birds app when I'm bored.
Maybe it's my age, 31, or my love of tech, but I don't know how I lived without it.
– Andy B.
Mobile Computing: Marketing Unneeded Products
Apple's most brilliant achievement has been to convince American consumers to shell out hundreds of dollars for its expensive planned-obsolescence hardware made by the cheap Chinese labor instead of by American hands. In a way, U.S. corporations like Apple are contributing to the American economic woes in the name of bigger profits. It's fair to say that a large proportion of Americans could not even dream of getting one of these gee-whiz high-tech iPhones.
– Anthony M.
Smartphones in the City
I just got a smartphone a few months ago because I thought it would help me after I moved to the city and started using the bus and walking around more. I love it. I can pull up the bus schedule or check movie times if I'm already out, or just sit outside and write e-mails on my lunch break. I think it's totally worth the data plan cost – but if the prices rise a lot, it'll be much harder to keep.
– Judy R.
iPhones are just ridiculous. You have to switch to prepaid. I'm sick of these big companies with so many people the calls constantly drop. I personally did straight talk. It's simple: no contract, no activation fees, no monthly bill. This is a great way to save money each month on cell phones. I don't understand why more people don't even consider it as an option. You get great coverage, which for me translates to no dropped calls. And, you know exactly what you will pay each month, no surprises at the end of the month. Now, that is something I can live with!
Be sure to answer next week's question: What do you think of President Obama's budget proposal? In terms of your own expectations, did his spending cuts and tax hikes meet, exceed, or fall short of what you predicted? In terms of what this country needs, did President Obama go far enough? Or does this plan fall short? If you think it fell short, is it at least a good starting point for negotiations?
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News and Related Story Links:
- Money Morning:
How to Profit from the Verizon iPhone
- Money Morning:
Tech Stocks Set To Soar in 2011 as a New Era of Personal Computing Dawns
You're using more smartphone data than you think
- San Francisco Chronicle:
Verizon iPhone Preorder Sales Estimate: 500,000 iPhones
- The Free Dictionary:
- Money Morning News Archive:
Question of the Week Feature