In the end, it's a problem of making business. Apple has a great concept: look for what people might want to do with a cell phone, and market that. Let's see:
-people want to phone, check
-people want a camera for prints, check
-people want a pda, check
-people want e-mail, check
-people want it to work wherever they are, and not just near a wifi router, check
-people want a mp3 player, ipod-like, check.

On top of that, Apple offers a few things for which it is not clear (yet) whether people will use them or not:
-a mobile browser that works
-a video player that works, including the ability to get videos to play on it.

That last point is important: there are many small video players on the market (e.g. Archos), but none of them makes it simple to actually get videos to watch on them (except in China, as I found to my surprise when travelling there, and those devices are indeed much more popular in China). Apple understood with the iPod that a store was a necessity for broad acceptance of a mp3 player, and they did the same for a portable video player.

Apple also is the only company who understood how to get around the limitations of the Internet for mobile devices. All mobile Internet devices face the same problem: web sites are designed by *****s who assume that you are running windows on a 2GHz pentium and a 1280x1024 screen (today, add 10% every year). All mobile browsers manufacturers face the same problem: squeezing those sites on a small, underpowered device is no fun, and you need regular upgrades of the software to keep up (flash 9 anyone?). Apple does it the other way around: partner with popular, content-rich sites so that they design their offer in a more sensible way (youtube is transfering all their videos from flash to h.264 for example). Notice the words: popular and content-rich, and not the joke that wap was.

True: all this comes at a price. So what? Who wants to make business with customers who are not prepared to pay a dime anyway?


Let's compare this business model with the one of other mobile browsers, the N800 but also other failed attempts like the Sharp Zaurus. First, they aim at an unproved market (mobile Internet), second, they don't do what people want. Those devices are supposed to be used concurrently with a cell phone, and be in your poket. So for this "Internet device", which doubles as a portable "thing", replacing whatever you may have had in your other pocket beforehand, what do people want? Let's see:
-people want it to work wherever they are, and not just near a wifi router, failed
-people want e-mail, failed for the most part
-people want it to replace their pda, failed
-people want a mp3 player, only so-so for lack of software
-people may want a video player, failed.

On top of that, those devices offer:
-a phone option, for which the main argument is that it is free or very cheap (voip, skype), but has the obvious limitation that you need to be near a wifi router: failed, you still need a cell phone.

So in the end, all mobile browser manufacturers faced the same problem:
-they have high software maintenance costs (to keep up with the Internet and web sites designed by *****s)
-their main selling point, mobile browsing, is not that popular (it's actually a small market as mobile operators who bought the UMTS licenses found out)


On top of this, the Nokia second selling point, free phone calls, is a business problem in itself: it's certainly far easier to make money with customers who bought your device for convenience at a price than with customers who bought it with the idea of saving 50$ on their phone bills.


So, in the end, it is a question of business model. Apple has found a great way to have their customers pay the device price and 10-20$ a month back to them. With this, they can finance future development. Nokia sells the N800 close to cost (200$ today), and has yet to find a way to finance future developments. Sure, they have linux enthousiasts who work for free, but that's not enough to make a device survive, as the Zaurus has shown. Sure, they can try to get the customer to register for rapsody (a service that is basically bankrupt and only exists in the US) or to pay for GPS maps, but that won't be sufficient, I'm afraid.


In the meantime, as N800 customers, we are riding on the proverbial free lunch, while iPhone customers have to pay every month but what does the proverb say about free lunches?

I think you (Jerome) fail in one important point:

- the iPhone is a phone, thus needs to substitute the one you have in your pocket. And it does. (Even if worse in many cases)

- the Tablet is not a phone, thus it needs to couple with a cellphone, not substitute it. And it does.

The iPhone is targeted at a specific target (a well known one). Easy life.

The Tablet is targeted at a specific target too (but one that is just growing: web people). Hard life.

Who get a tablet, usually expects a PDA (for many: touchscreen equals to PDA) but it's her, let's say, fault. She did not really know what the Tablet is.
And here comes Nokia's fault. People DO NOT know what the Tablet is.

But you're right in many of your points. Particularly the last one about the monthly subscription...but don't forget that Nokia's going to sell Maps and bringing people to the next mobile world (OVI and the alike)... They are big and they can dare anticipating stuff... may be they'll be able to forge it somehow... that's (I think) they bet on the Tablet.

LoL

If I buy an iPhone, can I join your cool offline social group? I've had it with these geeky losers and their "I know what, let's not believe everything we're told by the media" attitude!

I know perfectly well that the iPhone is a phone and the N800 isn't. That's because of this difference that I am saying that the N800 business model is a problem.


No, it's not an easy life. For example, Nokia sells phone internet devices and has been for years. They have the "communicator" series, they have phones like the N80i which can browse the web. None of those has been a stellar success. Compare with the following:

So, in just three months of sales, the iPhone managed to pass all but one competitors, all of whom have been on the market for years. That, and they chose an expensive business model which also force many customers to change their service providers. Frankly, calling that less than a stellar success is a fraud.

Bear with me here. I am not saying that they deserve their success (or not, please save me iPhone bashing, I don't have one), I am just stating the facts: they are incredibly successful. Obviously they sell a product that the customers want. And obviously they make a lot of money with it. Conclusion: good business.

Now, compare that with the N800. And compare that with the Nokia "communicator" series. And compare it with palm or pocket PC devices. Find out why Apple succeeded to make a lot of money where the competition does not.

The answer is quite simple: they sell what people are prepare to pay good money for. And that is a central problem with all devices similar to the N800:
-they aim for a small market
-their customers are penny pinchers (*)

That's an unsolvable problem. A firm can aim for a small market, if it brings corresponding high profits (e.g. the communicators series or the blackberry, aimed at businesses). A firm can make good living selling cheap devices if they sell millions of them (e.g. cheap Nokia phones, they are still number one cell phone maker). The two together does not work.


(*) Yes, they are penny pinchers. And so am I, too. I remember very well that all people I knew bought the Zaurus (including myself) loved the idea of linux programs being "free" software, in the monetary sense, while palm, WinCE or phone applets cost 20$ a piece in average. The Zaurus line is dead. Now, one of the main selling point of the N800 is that skype and gizmo have no roaming charges...

How many ads for a Nokia have you ever seen in a Time publication?

I think we are saying the same thing in different words and with a slight difference in point of view.
When you say "n800 aimed at a small market" is what I've said for "Nokia is pointing to Web2.0, a small but growing, hopefully, market".
When I said "easy life" for the iPhone I wanted to pointed out that Apple already knew what people want, as cellphone are here since years now... so it was easy to look at what was available, what people wanted and give it to them..

For the rest I agree with you.

Well usually, at least here in Italy, I almost never see Nokia's own ads.
Usually the phone providers put advertisements of Nokia's (and other companies') phones to advertise also their own plans (often you see plans bound to particular phones).

If it was so easy, why didn't anyone do it before? It's not like internet-enabled phones are a new thing, they have been on the market for at least 5 years... for example from Nokia (the communicator series).

There was a catch, of course. Nokia has the problem that their phone business model is such that their primary customers are the network operators, not the end customers. So they built phones to please the network operators (who get revenues from sms, downloaded ringtones and games, etc...). You know the result.

Palm and MS (pocket PC) are simply incompetent. That happens. On top of it, MS main motive is to tie you to Windows.

Blackberry went for a successful business model, and chose premium customers. Fair enough.

Something like the iPhone could only come from a new player (no ties with the networks) with good marketing clout.


Now, about the N800 (and the Zaurus, etc...). Those little machines seem to me more an exercise for the development team than anything really marketable. I can't believe Nokia's executive to be so incompetent to believe that the N800 (or the N810 or the N900) will bring big money. But sometimes, a firm like Nokia needs to test new waters: the portable game console market (N-gage anyone), the camcorder phone, the luxury, designed-for-fashion-conscious-women phone, etc... The N800 looks like one of those exercises to me.

Personally, i don't believe skype video will be there. Gizmo already has it, but skype... not sure. Minimal hardware requirements for skype ppc say 300Mhz, which is what nokia has too. And that's only audio. I guess gizmo uses simpler voice and video codecs than Skype, so they can work on that type of CPU. I haven't tried it yet though, not sure how fluid that stuff is.

In some ways, it's certainly a toss up considering the N810's SRP and the price of an unlocked iPhone. Apple's philosophy has always been make it simple, seamless and innovative for the average consumer. The PC and hacker crowd instead wants more open hardware and modification abilities. It's like a yin/yang, left/right brain thing. Apples do what they do very well, but they're not for everyone.

ITs are excellent, handheld browsers. I just think if Nokia said, right from the start, that they're also going to make and sell the N8xx (with their camera and Voip abilities) as a turnkey video call system, they'd be on the cover of Time instead.

Before they released the series, they could have approached Skype, Gizmo or Google just like Apple approached AT&T and Youtube. They could have presented this vision and put something together that would benefit everyone. Just a few well placed TV ads showing generic American families making handheld video calls (for "FREE", over their home WiFi ) and the shelves would clear rapidly by Xmas. Heck, they could have tied the devices in a with major ISP like a Tivo ("Get a free portable wifi browser & videophone with a 2 year contract").

Instead, if they're thinking about that at all, they may have shifted such developments to their cell phone research and newer signal protocols.