The Mac Sucks!

According to a post on The Register, four U.S. Senators have asked the acting FCC chairman to review whether mobile phone makers should be allowed to enter into exclusive contracts with wireless service providers. The senators’ thinking is that exclusivity agreements may “unfairly restrict consumer choice or adversely impact competition in the commercial wireless marketplace.”

Even though The Register reports that this is “a direct shot across Apple and AT&T’s shared bow”, I have to wonder if Apple itself isn’t behind this. At the recent Apple Worldwide Developer Conference (WWDC), Apple indicated that it was AT&T’s fault that they wouldn’t have MMS support in the iPhone until late in the summer, and that tethering support was not likely to be coming from AT&T soon. It’s even said that “AT&T’s network has been commonly regarded as the iPhone’s weakest link for as long as there have been iPhones (especially 3G ones).”

There was talk a couple of months ago about Apple inking a deal in the U.S. with Verizon to distribute the iPhone. The problem with those rumors is that it would imply that Apple had a way out of its deal with AT&T. But sources in the USA Today article linked above indicate that the Apple/AT&T agreement is good until some time in 2010. To get out of that deal early, it’s likely that Apple would have to pay through the proverbial nose to get AT&T to let go.

But let’s imagine a completely hypothetical scenario. Let’s assume that Apple really is fed up with AT&T, and wants out of its agreement now. And let’s assume AT&T is unwilling to play along. At the same time, Apple would really like to hurt the Palm Pre and Sprint, arguably its closest iPhone competitor right now. How might it do that? In this entirely hypothetical scenario, Apple could approach some lobbyists to pressure the FCC into ruling that handset exclusivity deals are anti-competitive. How does this accomplish all of Apple’s goals?

If such deals were ruled illegal, suddenly the Apple/AT&T agreement is null and void. Apple wins. It can start selling iPhones to any carrier whose networks its device supports. AT&T might be hopping mad about this, but Apple would be free to sell the iPhone through any carrier, just like it theoretically wants to do. Not entirely coincidentally (I suspect) that DOESN’T include Sprint with its CDMA based network. Having dealt with carriers on multiple continents, Apple already has experience adjusting the iPhone to work with carriers other than AT&T, so adapting it for other U.S. carriers would probably be relatively trivial.

At the same time, killing handset exclusivity deals in general also kills the deal between Palm and Sprint. Instead of focusing its development resources on improving the Pre and making it more competitive with the iPhone, Palm will have to expend effort adjusting the Pre to work with other carriers (something it would have done eventually, but is now being forced to do sooner). This would be an unplanned change to Palm’s Pre business plan. This sudden shift in focus would likely set the development of new features for the Pre back by several months, giving Apple even more time to improve the iPhone (relative to itself and the Palm Pre) and market the iPhone to other carriers. Given that many feel the Palm Pre is what will save Sprint as a company, the timing of this senatorial interest in handset exclusivity certainly seems very suspicious. It would potentially leave Sprint with a handset stuck at today’s functionality level (which, while quite good, is not yet superior to the iPhone in many areas) and a handset which is no longer exclusively a Sprint offering.

Outside the U.S., the proposed FCC ruling would not affect Apple (since the FCC has no control outside the U.S.). Apple can continue having exclusive deals with foreign carriers as long as it likes, at least where such deals are legal. Again, Apple wins.

There really isn’t a down-side for Apple in this scenario… at least none that I can see. If the agreements stand, Apple keeps selling iPhones through AT&T until the agreement runs out next year. If they’re struck down, Apple can sell iPhones through any carrier it wants to work with, and the Palm Pre (and Sprint – who couldn’t sell the iPhone anyway) takes a hit in the process.

Remember, the scenario I’m describing above is entirely fictional as far as I know. I have absolutely no knowledge or evidence that Apple has anything to do with this sudden interest by the U.S. Senate in cellphone handset exclusivity. This is entirely speculation on my part… it just happens to be speculation that meshes well with known facts and observations.

The folks at ABC News present a comparison of the iPhone and the Palm Pre in a video segment. The comparison lasts about 10 seconds and basically indicates that they like both phones, but the iPhone’s app store gives it a big advantage over the Pre. The Pre’s app store contains very little right now, compare to the iPhone’s 30,000+ apps. The segment on ABC News features USA Today’s Ed Baig, who penned a comparison of the two devices on that paper’s web site. Here are a few of the highlights from the comparison:

• “I’ve been testing the Pre for more than two weeks and like it a lot. Pre is easy on the eyes. I can’t think of a more comfortable cellphone in my hand. It has a lovely screen for taking in YouTube videos or browsing the web. The ‘always-connected’ software foundation at its code, which Palm designed from scratch and calls WebOS, is slick and rife with possibilities.”
• The Pre allows you to bring in phone numbers, calendar entries, and email accounts from Google, Facebook, and Microsoft Exchange (Outlook) and consolidate them in one place.
• The Pre allows you to keep multiple applications open at one time and switch between them with a swipe of the finger.
• “…I encountered occasional sluggishness and bugs…I also longed for the visual voice mail feature of the iPhone… And I wish the Pre had more third-party applications at launch.” (Bear in mind that the first iPhone was buggy at launch and had no third-party applications until much later.)
• Sprint’s voice and data plans are priced aggressively. A monthly voice/data plan with 450 “anytime” minutes goes for $69.99. An unlimited voice and data plan goes for $99.99 a month. Plans include unlimited text, picture, and video messaging, plus Sprint GPS navigation and Sprint TV.
• “Pre is 3.9 inches high by 2.3 inches wide and two-thirds of an inch thick – shorter but thicker than the iPhone. The compact, slightly curvy design results in a screen that’s a tad smaller than the iPhone’s.”
• “As with the iPhone, the Pre has sensors that change the orientation of the screen when you turn it to its side. Another sensor makes the screen go dark when you hold the phone to your ear during a call.” (In other words, two of the same features found in the iPhone.)
• “You can sync Pre with iTunes, just as if it were an iPhone or iPod. Well, there’s at least one difference. You can’t sync music or video saddled with digital copy restrictions. Nor can you buy iTunes music directly from the pre.” (You can, however, buy MP3s directly from the Amazon MP3 store on the Pre… though for some reason you need to be on wi-fi to download it.)
• The Pre’s web browser, like the Safari browser in the iPhone, doesn’t support Flash video.
• “The Pre has a better camera than the iPhone, though that’s not saying much.”
• “…the Pre, unlike the iPhone, comes with an easily removable battery.”
• “Though a splurge at $70, Palm has come up with a nifty accessory called Touchstone that lets you charge the Pre without a cable, by putting it on top of the dock.”

As I said in my own commentary, the iPhone still has advantages over the Pre. It’s more recognizable (largely due to Apple’s seemingly 24×7 ad campaign), there are more apps for it (though that is likely to change over time), and it’s a more mature device than the Pre. On the other hand, the Pre has advantages as well. It’s got a hardware keyboard, a better camera, a swappable battery, a potentially cheaper service contract, and (based on the “anti-AT&T buzz” at the recent WWDC) it’s not tied to AT&T (though I know there are many people not fond of Sprint, either).

In my recent post on the Palm Pre, I suggested that Microsoft needs to get its act together with respect to Windows Mobile if it wants to remain in the market for long.  Reader “Joshua” commented that I did Windows Mobile a disservice in that article, and he may be right.

Windows Mobile is a very functional OS.  Microsoft provides some great development tools for Windows Mobile, comparable to those offered for the desktop version of Windows. 

As one simple example, the iPod Touch has a decent web browser, but it doesn’t allow you to download software or media files onto the device from the web sites you visit.  Windows Mobile allows that.  I don’t have to use a special sync software from Microsoft to get files onto the device.  I can put music or a movie on the phone without an “iTunes equivalent”.

My Windows Mobile phone incorporates a micro SDHC slot, which the iPhone and iPod Touch do not.  This makes it easy to shuttle pictures and other media between the phone and computer.  There are ways to do this with the iPod Touch and iPhone, of course, but there’s no SD slot.

But Windows Mobile has some significant issues.  Microsoft has addressed some of this in the upcoming Windows Mobile 6.5 update, though my phone as it is right now exhibits all the issues I describe below.

First, every Windows Mobile device I’ve ever used periodically wakes itself up.  I remember reading that it does this to perform maintenance activities, check calendar appointments, etc.  Why it has to activate the screen when it does this, I don’t know.  Worse, why it can’t always remember to shut off when it’s finished is inexcusable.  On the day I visited the Sprint store to look at the Pre, I pulled my HTC Mogul out of my pocket and it was completely dead.  It had been charged the previous day, so there was no reason for it to be dead, yet it was.  I’ve seen this on non-phone Windows Mobile devices going back several releases.  I’ve never seen it happen on the old Palm Pilots, the iPod Touch or iPhone, or Blackberry.  I recognize that this might be a hardware issue, but why isn’t Windows Mobile smart enough to realize that no one is using it and shut itself off before it drains the battery?

My Windows Mobile phone requires me to remove a “hidden” stylus in order to interact with some applications because their interface elements are too small to touch with a finger.  There’s no reason a modern smartphone OS should need a stylus.  This is addressed somewhat in Windows Mobile 6.5, but I suspect Microsoft will need time to sort out issues with this. 

Then there’s the mobile version of Internet Explorer.  Functionally, it’s at about the same level as the Windows (desktop) version of Internet Explorer was at version 3.0 (as opposed to today’s 8.0).  Apple has been making a killing in the consumer space with the iPhone because its browser is genuinely superior to Mobile Internet Explorer.  Don’t get me wrong.  I don’t really like Safari compared to Firefox, but “Mobile Safari” is way, way better than the crappy version of IE bundled on my phone.  The Skyfire browser for Windows Mobile is far better than Mobile IE, but even it isn’t as easy to work with as the iPhone browser.  (Skyfire is better in several ways, but not as easy to work with.)

While Windows Mobile does look “dated” compared to the iPhone or Pre, I don’t need the eye candy.  I’m more interested in having a smartphone that doesn’t randomly go dead, doesn’t require a tiny little stylus to be kept in it, and can display relatively modern web pages properly.  My current Windows Mobile phone fails those criteria.  In the end, I don’t much care which mobile OS my phone uses, as long as it works well.

I’ve read a lot about the new Palm Pre phone lately. Since I had the day off, and I’m already a Sprint customer, I decided to go take a look at the phone at my local Sprint store. After spending about 10 uninterrupted minutes with the phone, here are my quick observations:

• The web browser in the Pre is based on WebKit, just like Safari on the iPod/iPhone. As such, it renders web pages every bit as well as Mobile Safari. And given the speed of the Sprint wireless network in my area, pages load impressively quickly, too.
• It only took a few seconds to get used to the interface, which is iPhone-like, though a little lighter on the eye candy (by which I mean it tends to use eye candy where it’s appropriate and only to the degree necessary to get a point across). In spite of that, I found it as fun to use as the iPod Touch.
• The screen is gorgeous, and made the iPod Touch screen seem a little bit “cartoonish” in comparison.
• The touch screen responds instantly to touches and gestures, though there is just the briefest hint of a delay between touching the screen and getting a response.
• The built-in GPS application was great, and is based on Google maps. It launched and displayed my exact location in a matter of maybe 2-3 seconds. It would definitely be useful in an unfamiliar location.
• I watched a sample video on the device. It played without any stuttering and the image quality was at least as good as what I see on my iPod Touch.
• The hardware keyboard looks cramped, but I found that I could actually “type” on it more quickly than I could the iPod/iPhone’s on-screen keyboard.
• The device had a solid feel, maybe not as solid as the iPod Touch, but more solid than my HTC Mogul (which is no slouch either). It’s light and comfortable to hold.
• The images people had taken in the store with the built-in camera were excellent. They were head-and-shoulders above anything I have gotten with the Mogul and certainly better than any other cell phone camera I’ve seen or used. I could actually imagine printing some of these pictures.
• Unlike my Mogul, which is a Windows Mobile device, the Pre connected instantly and effortlessly to the Sprint network. It usually takes the Mogul several seconds to “warm up” that connection.
• If Microsoft doesn’t get its act together, and quick, it may as well get out of the smartphone market. Between the Pre, the iPhone, and the Blackberry, I no longer see the point of Windows Mobile. If I had it to do over again, I would not be using this device… and I used to love Windows Mobile (before it was used in cell phones and Palm was its main competitor).
• Apple timed the new iPhone OS at the right moment, since it includes some of the things that make the Pre impressive, like multi-tasking. It’s very cool to have multiple phone apps running at once, just as it was once really cool to have multiple apps running simultaneously in “Classic” Mac OS. (Yes, I’m dating myself there.)
• The Palm Pre app store, compared to what Apple has right now, is pretty much just a “placeholder”. Apple definitely has the upper hand there. However, if Palm makes the SDK available free and encourages Pre developers, I see no reason just about any iPhone app out there right now couldn’t be written for the Pre. Granted, there’s not much there now, but it’s growing. The iPhone didn’t have 10,000 apps overnight.
• My local store has the Pre on a waiting list. I was told unofficially that they have 11 people on the list right now and get shipments of 20 units every few days. While people clearly aren’t camped out on the street to get the phone, there’s definitely an interest in it and it looks like Palm and Sprint have a success on their hands.
• Depending on your needs, you can get a data and voice plan for the Pre as low as $69.99 from Sprint. That includes their “unlimited” data usage plan, 450 “anytime” minutes, and unlimited night/weekend minutes… plus other features. For $99.99 you can have unlimited anytime minutes and unlimited data. That’s not bad when compared with the iPhone and AT&T.
• The Pre’s retail price is $549. If you’re an eligible Sprint customer, you can get the Pre for $199 at my local store after rebates and other discounts. At that price, it’s comparable with the iPhone (though not cheaper).

The above sums up the “positive” side of the Pre. I don’t have a lot of negative things to say about it, though:

• I know the Pre is primarily supposed to be a “cloud based” device, but I’d still like to see more local storage on it than 8GB.
• I’d also really like to see a micro SDHC slot (or two) in the device, as this would make it possible to download information or media from the Internet to the device and transfer it to a PC or Mac.
• The iPod/iPhone seemed a little tiny bit better at figuring out what link I was trying to tap on in the web browser, though I don’t think I actually got the wrong link in the Pre at any point.
• The built-in keyboard gets a lot of criticism for being small and oriented toward a “portrait” view only, and some of that criticism is definitely justified. While I found it easier to use than the iPhone/iPod keyboard, I can easily see where fatter fingers or bigger hands than mine would have a lot of trouble with it. The keyboard on my HTC Mogul is superior to both.

In the final analysis, I was very impressed with the Pre. In fact, in six months when I’m eligible to get the Pre at something closer to that $199 price than the $549 retail price, I fully expect to walk out of a Sprint store owning one. With any luck, the next-generation model will solve the keyboard, app store, and storage issues, making it a very worthy competitor to the iPhone.

Would I advise anyone with an iPhone to run out and get the Pre? No. I would admit that overall the iPhone is probably still the superior device. However, if you are looking for a smartphone and you’re not already an AT&T customer, you might want to visit your local Sprint store and give the Pre a test drive. If you don’t like it, well, there are always the Blackberry and the iPhone…

AppleInsider has published a chart showing the “emerging iPhone contenders” and comparing their specifications to one another. They look at hardware features, application stores, email/messaging, content strategies, pricing, data plans, distribution, and milestones. If you’re curious to see that the competitive landscape for the iPhone looks like, check it out.