The iPhone is coming. What now?

Globe and Mail Update

No cellphone created as much of a stir as the introduction of Apple's iPhone a year ago. It was the must-have high-tech gadget of 2007. But Canadians couldn't get it.

Finally, after a year's wait, Canadians will be able to walk into a local store and drop $200 or more on their news device. While many know what the original iPhone offered, Steve Jobs announced a slate of new applications and functions for the 3G model that will be landing July 11.

  • Join the Conversation with Apple superfan Sandy McMurray, who will take your iPhone questions until 2 p.m.Sandy can give you an idea what to expect with the new model. Join us here.

This phone promises to offer the full Internet experience as well as the usual phone calls, all in the same beautifully designed package that is even smaller than the first iPhone.

One thing that is immediately obvious is that Apple is charging much less for the new phone — Apple is dropping the price of the eight-gigabyte version to $199 (U.S.) from $399.

Early reports had shares fall in companies with competing products, such as Palm and Research in Motion, maker of the BlackBerry, when Apple announced the news.

Will the new iPhone make an impact on the cellphone market as big as the hype surrounding it says it will?

We asked Sandy McMurray, editor of Techstuff Canada, the Corante blog on all things Apple and an Apple industry analyst, to answer readers' questions on the new iPhone at 1 p.m. Wednesday.

Editor's Note: globeandmail.com editors will read and allow or reject each question/comment. Comments/questions may be edited for length or clarity. HTML is not allowed. We will not publish questions/comments that include personal attacks on participants in these discussions, that make false or unsubstantiated allegations, that purport to quote people or reports where the purported quote or fact cannot be easily verified, or questions/comments that include vulgar language or libellous statements. Preference will be given to readers who submit questions/comments using their full name and home town, rather than a pseudonym.

Jack Kapica writes: Good afternoon and welcome, Sandy McMurray. We had a lot of advance questions posted, so let's start with them, right away.

David Hosten from iPhoneville writes: Will the price of the newly announced iPhone really be $200 U.S. to buy the phone, or will that be actually be $200 with a three-year Rogers plan price?

Sandy McMurray answers: Rogers will launch the 3G iPhone on July 11. The price is $199 for the 8Gb model and $299 for the 16Gb model. Rogers will require customers to sign up for a three-year plan. Nothing else has been announced.

Rogers says, "More details on pricing and availability will be available soon."

Here are some info-rich quotes from the joint press release issued on June 9 by Apple and Rogers:

"iPhone 3G will be available in Canada on July 11."

"iPhone 3G will operate on Rogers' High Speed Packet Access (HSPA) wireless network, the fastest mobile network in Canada. HSPA is nationally available in the top Canadian urban centers from Vancouver to Halifax, covering more than 60 percent of the population."

"iPhone 3G will also operate on Roger's coast-to-coast GSM/EDGE network, proven to be the country's most reliable wireless network. More details on pricing and availability will be available soon."

The iPhone 3G may also be available through Fido in Canada but Rogers will neither confirm nor deny this, saying only that "more details on pricing and availability will be available soon."

Tweev D from Halifax writes: I live about six months in Halifax and the other six in southern California. Cellphone plans are not known for flexibility. Is there any way I could get a plan for an iPhone that would accommodate my lifestyle without costing thousands of dollars a year?

Magic 8 Ball (Sandy McMurray) replies: "More details on pricing and availability will be available soon."

Seriously, Apple and its partners seem to have agreed to a quiet period regarding data rates and carrier plans to focus attention on the iPhone 3G, its new features and its new price. The worldwide launch begins July 11. We may not get many more details before then.

Steve Miller from Toronto writes: I've read that the first generation of the iPhone is not actually a great phone (from Consumer Reports: "As a phone, it's only so-so in voice quality"). Will the 3G version see any improvements in this area and can we expect "better" phone functionality?

John Deere from Canada writes: In the WWDC keynote speech Jobs claimed there would be "dramatically improved audio" on the iPhone. Has there been any technical briefings or explanations that have been released explaining the reasons for these claimed improvements?

Sandy McMurray answers: I haven't used an iPhone 3G, but I think the "dramatically improved audio" mentioned in its feature list is the fix for voice quality issues in iPhone 1.0.

M.O. from Canada writes: I'm less concerned about the eventual purchase price of the device as I am about the operating costs. The iPhone may be an amazing piece of technology, but how will the average Canadian be able to afford to use it?

Sandy McMurray answers: Wait. Early adopters always pay through the nose for cool technology. Later on, it costs less and works better. If you're interested and you can afford it now, great! Buy an iPhone 3G. If you can't afford it, stay away.

If the iPod teaches us anything, it's that the iPhone will eventually come to you, with more features and a lower price.

Linda Smith from Edmonton writes: I use a Mac at home with Entourage and a PC at work with Office. Will I be able to sync with both programs? Is there any specific program I need to purchase in addition to an iPhone to make the syncing with two different formats possible? Why would I buy the iPhone instead of a Blackberry, other than brand loyalty and coolness factor? I suppose that's three questions -- thanks in advance for your help!

Sandy McMurray answers: Apple's just-announced MobileMe service is the answer to your first questions. MobileMe is a Web-based tool that synchronizes data among various devices including Windows PCs, Mac computers and the iPhone.

MobileMe (and the iPhone) will support Apple's own Mail program as well as Outlook in Windows. (Monday's keynote address did not mention Entourage, which is the Outlook equivalent in Microsoft Office for Mac.)

Apple describes MobileMe as "Microsoft Exchange for the rest of us." It's an update and a replacement for the current service, which is known as .Mac.

As for why you should buy an iPhone rather than a BlackBerry, that's up to you. Apple's answer would include the third-party software programs that are about to arrive from Apple and its partners, which will turn the iPhone into a software platform, not just a phone and Web browser.

Monday's demo of several games was eye-opening. Game developers can use the built-in "accelerometer" to turn the iPhone into a controller that works like Nintendo's Wii. Turn the iPhone to steer in driving games; tip the iPhone to move a ball on the screen in MonkeyBall. I think we're going to hear a lot more about games on the iPhone in the very near future.

Julio Moreno from Etobicoke writes: I have a Treo phone. The main uses are as a phone, to keep appointments and contacts with personal and company information. Will the iPhone do all of these items?

Sandy McMurray answwers: It will do all of that and more. The iPhone has real web browsing, a music player and a direct link to YouTube videos. The new iPhone 3G adds a faster wireless connection and a GPS (global positioning system), so you can always know where you are (and find things nearby).

The iPhone can also use Wi-Fi instead of a cellular plan, so you can do web browsing, e-mail and so on from anywhere there's a wireless connection, without paying cell phone fees.

Shawn Boutin from Canada writes: Is there any idea of how much stock will be available at launch? And will there be any pre-orders taken?

Sandy McMurray replies: As far as I know, neither Apple nor Rogers has commented on availability or pre-orders. I expect there will be lineups. And if the rumours are true, that you won't be able to buy an iPhone 3G without activating a Rogers/Fido contract at the same time, the lineups will be slow as well. I expect that both Apple and Rogers will do everything they can to avoid iPhone Rage in the malls.

Alex Kitz from Toronto writes: Sandy, in the United States, AT&T has $25 all-you-can-eat data service. Knowing that Rogers will never be so kind or so business-savvy, what do you think the average customer will need to pay for a data plan that takes advantage of the many new features on the iPhone?

Sandy McMurray answers: As previously mentioned, Rogers and other carriers are saying they will announce details closer to the July 11 launch date.

Here's what we know, though: AT&T customers with iPhone 1.0 are paying about $60 per month for voice plus unlimited data and a limited number of SMS messages. AT&T says it will charge $10 per month more for its iPhone 3G contract, and SMS will no longer be included. That brings the total to $75/month.

This will be the number against which Rogers' offering will be compared. Note also that Rogers is requiring a three year plan. Some carriers are going with two years or even 18 months.

It won't be cheap.

Shiela MacKay from Toronto writes: What will Bell and Telus need to do to stay afloat come July 11?

Buy Apple shares?

Seriously, although I believe the iPhone is a game-changer, there will still be demand for other phones. If Bell or Telus can provide a national 3G network with comparable service, the iPhone may yet be available from multiple carriers in Canada. (Not any time soon, of course.)

M. Samra from Toronto writes: I have read that the new iPhone will have GPS and live mapping capabilities. Does that mean I will be able to use it the same way as any TomTom or Garmin product? I was thinking about buying one of these, plus I need to replace my cellphone, so it would be nice to have the two-in-one functionality.

Sandy McMurray answers: As mentioned earlier, the iPhone 3G will have GPS built in. It will be better than stand-alone GPS devices in that software developers can release "apps" (iPhone software) that use the GPS hardware to do cool things.

One iPhone app demonstrated Monday combined social networking (like Facebook) and GPS to provide a way to find where the people on your friends list are right now. If you see someone you know is six blocks away, you can send a message and invite them to lunch.

I think we're also going to be writing a lot about the privacy issues of GPS very soon as well. ;-)

Bryon White from Toronto writes: The iPhone has some Microsoft software capabilities and supports Word, Excel, PowerPoint, much like the Palm phones do. Will an external Bluetooth keyboard be available with the iPhone, as with the Palm and the old Dell, and Compaq/HP type phones, thus making it a mini computer? I use my Palm that way and it's great ... when it works. Thanks!

Sandy McMurray answers: As far as I know, Apple has not announced or approved any computer-like accessories for the iPhone 3G. It seems to be their preference to have people use the touch screen to type and edit. It will be interesting to see what develops. My prediction is that Apple will not market the iPhone as a computer replacement any time soon.

Ted Parkinson from Kitchener, Ont., writes: Okay, so this is a big improvement in features, speed and much lower price. Sounds great except for the two-year or three-year deal we'll have to sign up for with our friends at Rogers (or FIDO according to the Apple site). So what's coming next year that's even better and cheaper?

Sandy McMurray answers: That's my concern about the three-year contract -- Apple doesn't sit still. The iPhone 3G is the hottest new technology right now (well, on July 11), but we just know there will be something better (or smaller or cooler) from Apple before the contract ends.

I read a clever blog entry last night from someone who figured out that the $600 he spent on the original iPhone should have been invested in Apple stock. Today, he would have enough to buy an iPhone 3G and have $600 left over. If you have any uncertainty, maybe you should buy stock instead.

Dave Cook from North York, Ont., writes: I have been very impressed and pleased with previous Apple products' immunity to virus attacks and such like. Can I expect the same with the iPhone?

Sandy McMurray answers: People are often surprised to learn that I don't run anti-virus software. Mac OS X is anti-virus software.

Mac users know there's not a single virus that affects OS X today. Not one. It's been more than seven years -- surely if the relatively small market share was the only reason Macs are virus-free we would have seen one real virus by now.

Will this same great security record be extended to the iPhone? It should be -- the iPhone uses the same system software ("kernel") as Mac OS X.

If anything, Apple seems to be trying to ensure that the iPhone is more secure than the Mac. Consider the new App Store. This is the only way you can download new software onto your iPhone or iPod touch. This means Apple can do security scans on software before it gets to iPhone users. It's tough on software developers, but great for customers -- everything you install will be pre-screened.

Let's face it -- most viruses, malware and worms that affect computers affect Windows computers. Most are based on design flaws in Internet Explorer and Windows (specifically, the ActiveX scripting language in Internet Explorer, and the fact that most Windows user accounts have full administrator rights to install software without typing a password.

I'm off-topic now, but here's the point: the iPhone avoids most viruses and malware by avoiding Windows and Internet Explorer. It's more secure by design, just like the Mac and other UNIX-based operating systems that separate user data from system data.

K.S. from Toronto writes: A lot of the hype surrounding the iPhone and other new devices has been about their Internet capability and high speeds. But with the cost of mobile data as high as it is, will anyone be able to afford to use these devices for more than a few minutes a month? Also, as a long-time Treo user, how difficult would it be to migrate my existing applications and data to a new device? Have Apple or RIM put much effort into addressing this issue? An application which I have now but which doesn't seem to be widely available for other devices is one which tracks my data usage. Given the aforementioned high cost of data, why isn't the capability to track usage a basic function built into every smart phone?

Sandy McMurray answers: The answer to your first question is that both the iPhone and the iPod touch can do everything except phone calls using Wi-Fi wireless instead of cell phone networks. Wi-Fi is faster and cheaper than cell, but not as available when you're on the road.

So you can do most things on Wi-Fi and avoid big data usage.

In case you missed it in two of my answers, please note that the iPod Touch does everything the iPhone does except for voice, and costs about $300. Games and other apps for iPhone 3G will also work on the iPod Touch, so you might want to look into that product if you're not willing to pay for a three-year cellphone contract.

The iPod touch doesn't have the new built-in GPS but that (and phone calling) are about the only features missing. iPod Touch is cool.

To answer your second question, I'm not aware of any tools to migrate data from other devices to iPhone, but if there's demand, I'm sure someone will make the software and offer it via the new App Store. That's what it's there for.

To answer your third question, see a recent blog entry from the Globe's own Jack Kapica. The answer sounds awfully cynical, but the reason there's no way to track your data usage is you might use less data if you could track your usage. Ask Jack about that one.

Shiela MacKay from Canada writes: Is there anything coming out of the pipes for Bell and Telus? Something like the recently announced Blackberry Thunder (CDMA) for Verizon perhaps?

Sandy McMurray answers: Sorry, no idea. I'll watch my e-mailbox for press releases right after this chat and post to my TechStuff.ca blog.

N.J. from Canada writes: A three-year contract seems unfair since AT&T has it on a two-year contract. Does a three-year contract guarantee that Apple will not introduce more iPhones until then? I just don't want to be stuck in a three-year contract only for them to introduce the iPhone v3 next year. Is the iPhone going to have copy/ cut/paste options?

Sandy McMurray answers: I can cut and paste the answer to your first question. Rogers says, "More details on pricing and availability will be available soon."

The iPhone 3G announcement did not highlight copy/cut/paste features. If it's not there now, I don't think it's been added.

JD Smith from Toronto writes: 1) Will Apple be successful using its App Store distribution model which restricts developers to using Apple as the sole distributor (yes, there is an Enterprise instance of App Store) and in which Apple will take a whooping 30 per cent of each sale?

2) Is there an ability to replace or augment the low-level communications drivers in the iPhone?

3) Can you say anything about iPhone and Google's Android? Yes, these questions are a bit technically specific (marketing and OS) but they are relevant to Canadian software developers.

Sandy McMurray answers 1: Like music labels, iPhone software developers can take or leave Apple's terms. 30 per cent is a lot, but remember that Apple does all the heavy lifting including all transactions. Remember also that the App Store provides an instant worldwide market for your iPhone app. Only 4,000 developers were accepted into the program, so I expect initial quality will be very high. Yes, I think it will be successful.

2: Check out the new iPhone 2.0 software development kit, which was highlighted in the keynote address on Monday. It gives iPhone software developers the same tools used by Apple itself.

To address your specific question, I doubt that Apple will permit one bit of software to replace or bypass any system software needed by other iPhone applications.

Answer 3: Android looks interesting, but Apple's winning strategy has always been integration of hardware and software. Unless Google starts making the hardware themselves, Android-powered devices will always be playing catch-up with Apple. (This is fine, of course, if Android-powered devices come later but cost less, or provide another compelling reason why they're better.)

Randy Chatterjee from Vancouver writes: Apple's revenue- sharing contract with service providers, where it takes a monthly cut from subscriber payments, is a significant change for the industry, as also is its requirement (at least in the United States) for the selected provider to include unlimited data transmission at a fixed rate. In the U.S., this rate, including Apple's cut, starts at around $54 from AT&T, below many basic Canadian rate plans with no data service. After a year of wrangling with Rogers, what do you think Apple has negotiated for rates and services in Canada?

Sandy McMurray answers: AT&T has confirmed that the revenue-sharing agreement with Apple will NOT continue with iPhone 3G. I see no reason why Rogers and other carriers would ask for this deal, so it's probably over.

The iPhone 3G deal is different (at least, it is with AT&T). Apple gets paid for the hardware and the carriers get all the money from the cell phone contract.

Strategically, the new App Store is all about giving Apple a new revenue stream. Rogers and Bell and Telus won't be able to sell $4 ring tones to iPhone owners if they can download software to make their own, or to convert their iTunes songs into ring tones.

Furthermore, if Apple is right and the iPhone is not just a phone but a software platform -- like Mac and Windows -- there's much more money available to Apple from add-on software than they would get from a share of the carrier agreements.

This is especially true if Apple eventually is able to do an end run around cell phone companies and offer VoIP (voice over IP) phone services on Wi-Fi networks. But that's a topic for another day.

Jack Kapica, moderator, says: Wow, we;ve one way beyond out hour-long limit. I want to thank all those who wrote questions and Sandy McMurray for answering them.

Sandy McMurray writes: Thanks for reading! If you have more questions about the iPhone 3G, feel free to drop by TechStuff.ca or send an e-mail to editor@techstuff.ca

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