Another year, another iPhone. This year’s 3G iPhone release didn’t quite capture the majesty of the first iPhone release, did it? I figured that Apple was shooting for true market penetration in the smart phone industry; however, like many other bloggers, I was mislead by the initial $199 price tag.

As it turns out, the costs of the 3G iPhone are actually higher than the service plan & hardware of the original iPhone. I personally was planning on buying one (despite how much I hate the Apple fan boy culture) until I read article after article about the pricing discrepancies. I know there were plenty of other people who felt the same way I did.

Watching the 3G iPhone buzz erode from early June when some of the deceptive pricing bubbled to the surface of the blogosphere to disastrous iPhone App Store debacle was like witnessing a train wreck in slow motion.

Apple’s marketing campaign had all of the potential to be just as big of a blockbuster as the original  iPhone launch; look at what we consumers were promised:

• Support for high speed cell networks (3G)
• Support for enterprise business applications (Exchange)
• GPS
• And an application store.

But yet the 3G campaign ended up being a horrible comedy of errors when launch day arrived. What the hell happened?

• Pricing disaster - Protip for AT&T and Apple: if it’s easier for me to calculate all of my living expenses for two years than it is for me to figure out how much your phone + service will cost me over the same period of time, you’re doing it wrong. The data plan doesn’t cover text messages, the syncing features cost extra, existing iPhone customers can’t figure out if they’re going to have to pay the full price or $199, and the beat goes on. It’s easy to figure out who screwed this one up:  Apple let AT&T dictate the pricing in the usual giant telecom conglomerate fashion which is to say “vague and unintelligible.” This pricing fiasco deters people not because they’re unable to pay the costs of the phone, but because the apparent disorganization of the pricing makes potential customers insecure. I can’t fit a new wireless service plan into my budget if I can’t figure out how much it costs.
• Apple killed the goose that laid the golden eggs - Most of the people lined up around the street to buy the damn phone were the same fanboys who threw down $599 for the original iPhone, many of them already pissed off about AT&T/Apple’s deceptive pricing. Apple made it abundantly clear that it does not give a shit about these people; let’s review:
  • Apple dropped the price of the original iPhone by $199 not long after the first release, and their “store credit” apology was not well-received even by many hard-core Apple acolytes.
  • The new 3G iPhone pricing is revealed, and guess what? New AT&T/iPhone customers get a better deal than the same folks who already got screwed over once before by the price drop.

  The same hard-core user base who kept Apple alive during the dark days of the mid-late 90s are the same ones who’ve gotten slapped in the face with every update since the iPhone release, and you know what? I think that this time Apple actually killed the goose that laid the golden eggs, and for what? 1 million units sold on one day? What about a lifetime of sales from loyal Apple customers? If Apple starts an annual product cycle for its line of phones then I don’t think we’re going to see as many people line up so enthusiastically next time. They’re not going to drop Apple like a bad habit, but I don’t think those same people will be so quick to shell out money for a new unit every year.

• Apple’s “Bluescreen” moment, the App Store Activation Cock-up - Face it: the opening day activation process for the iPhone was an unmitigated disaster. This is something that we’ve come to expect from Microsoft, not Apple! What happened? Poor scalability design, which is insane given that Apple knew the exact number of maximum activations, which is to say every iPhone old and new. This epic failure is to Apple as what Bill Gates’ infamous “bluescreen moment” is to Microsoft.

Maybe if AT&T figures out its pricing I’ll revisit the possibility of buying a 3G iPhone, but I have to admit, when my service plan with Verizon expires in December I am awfully tempted to buy another Treo.

On that note, what are all of you buying? iPhones? Gphones perhaps?

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