Vittorio Colao, Vodafone’s chief executive, has said that not having the iPhone was a key reason why the operator lost 159,000 customers in its latest quarter.
O2 dropped the ball by keeping the iPhone pricing high and seems to have hinged it’s hopes on the Palm Pre which it unleashes on the network on October 16th. The Pre has awareness in probably 1% of the UK and their App Catalog policy seems to be as bad, if not worse, than Apple’s.
It’s going to be a tough battle for the Pre in the UK, of course, with Apple holding 3 of the top 5 brands (according to CoolBrands) and iPhone being currently the #1 brand in the UK. Certainly the iPhone has penetrated suburbia – at a house party at the weekend, nearly half the attendees had iPhones and the rest were a mix of Nokia and Blackberry devices (and a smattering of lesser manufacturer fashionphones). And this was not a geek party – it was a party of bankers, firemen, teachers, HR personnel and homemakers (and I was the only geek there).
The investment that people put into their apps is an anchor to a platform. This worked well for Windows back in the day as people couldn’t do without certain apps and it was hard to convince them to re-buy their apps on the Mac (or just do without on Linux or BSD). The same goes for the iPhone. Some people have hundreds (or even thousands) of pounds worth of apps on their iPod touch and iPhone devices – it’s going to be hard to convince them to move to another platform and their loyalty to iPhone will now start to convince hold-outs who resisted the iPhone due to the networks it was available on. After that – once they’ve bought one Apple device, it won’t be long until they buy another. That’s the halo effect in operation.