This report will focus on the company, Apple Inc. and their newest product, the iPhone. Also included will be the target markets, company information and background, specific product information and comparative analysis of Apple Inc. and its competitor, Samsung. The prospect company is Sprint Nextel Corporation and this report will help their company to have a better understand of Apple Inc. and their innovative product, the iPhone. GENERAL INDUSTRY History of the Cellular Phone Industry
Motorola is widely considered to be the inventor of the first practical mobile phone for handheld use in a non-vehicle setting. Using a modern, somewhat heavy portable handset, Motorola manager Martin Cooper made the first call on a handheld mobile phone on April 3, 1973. The first commercial cellular network was launched in Japan in 1979 and fully automatic cellular networks were first introduced in the early to mid 1980’s with the Nordic Mobile Telephone System in 1981. This was followed by a boom in mobile telephone usage, particularly in Northern Europe.
(1) The first modern network technology on digital cellular technology was launched by Radiolinja, in 1991, in Finland on the GSM standard and marked the introduction of competition in mobile telecoms when Radiolinja challenged Telecom Finland. A decade later, the first commercial launch of 3G (Third Generation) was again in Japan and by the early 1990’s, most mobile phones were too large to be carried in a jacket pocket, so they were typically installed in vehicles as car phones.
Today with the miniaturization of digital components, mobile phones have become increasingly handy over the years. (1) Sales and Trends Approximately 812. 5 million cell phones were sold in 2006 and more than 900 million cell phones are estimated to sell by year-end 2007. Nokia remained at the top of the pack with 265 million phones sold while following close behind were Motorola, Samsung, and Sony, the major competitors in the cell phone industry.
For 2006, the annual sales for these companies are as follows: Nokia $15. 2 billion, Motorola $11. 8 billion, Samsung $18.16 billion, and Sony $70. 3 billion. (In case there is any confusion, the annual sales of cellular phones alone determine what company is the best in the industry so companies such as Sony who have over $70 billion in sales can attribute most of those sales to other product lines whereas Nokia sales of $15. 3 billion are strictly cellular phone sales.
Innovations On October 31, 2007 innovations in the industry include V Cast Mobile TV airing live NBA Games, Yellowpages. com launching new local search engines on mobile phones sold at AT&T Inc., Google-powered cell phones are coming to Sprint and Verizon, Samsung introduces a new line of smartphones comparable to the iPhone, Motorola launches the first ROKR (Bluetooth in-car speaker phone that plays music) for automobiles and Apple limits iPhone sales to 2 per customer. (1) APPLE INCORPORATED History of Apple Incorporated Steve Jobs and Steve Wozniak had been friends for some time, having met in 1971, when their mutual friend, Bill Fernandez, introduced 21-year-old Wozniak to 16-year-old Jobs and Jobs managed to interest Wozniak in assembling a machine and selling it.
With this idea, Jobs approached a local computer store, The Byte Shop, who said they would be interested in the machine, but only if it came fully assembled. The owner, Paul Terrell, went further, saying he would order 50 of the machines and pay $666. 66 each on delivery. Jobs then took the purchase order that he had been given from the Byte Shop to Cramer Electronics, a national electronic parts distributor, and ordered the components he needed to assemble the Apple I Computer. (2) Before Steve Wozniak co-founded Apple, he was an electronics hacker.
By 1975, he was working at Hewlett-Packard and helping his friend Steve Jobs design video games at Atari. In that year, Wozniak received an issue of Popular Electronics Magazine on how to build your own computer terminal and using off-the-shelf parts he designed the Computer Conversor, a 24-line by 40-column, uppercase-only video teletype that he could use to log on to the minicomputers at Call Computer where Alex Kamradt commissioned the design and sold a small number of them through his firm. (2)
As you can imagine, these small projects led to larger innovations and eventually the founding of Apple on April 1, 1976 by the “two Steves”. On January 3, 1977 Apple became incorporated and later that year an update of the Apple I is introduced, called the Apple II. On July 30th the Apple III was designed and released in January 1983. Previous to the innovation of the Apple III, on December 12, 1980 Apple Inc. became a publicly traded company making more than 40 employees instant millionaires. (2)
With all the updates taking place over the next 20 years, including updating the operating systems yearly (MAC) and coming out with new and improved products in the computer electronics market; Apple is brought into the 21st century with the creation of a new product line, and in October 2001 the Apple iPod is introduced, from here, the iPod nano, a smaller version of the iPod is created and sold in 2005 as well as iTunes which Apple had to sign five major recording companies to achieve the rights to sell the songs for these devices.
In the current year 2007 on June 29, their newest innovation the iPhone was created and sold and proved to be the most technological smartphone on the market to date. (2) Current Company Information Apple has been in business for 31 years, since early 1976, and now employs over 17,780 people worldwide in their headquarters and office locations. Headquarters are located in Silicon Valley, California, while all other regional offices are located in Austin, Texas, Cork, Ireland, and Singapore.
Apple factories on the other hand are located in Longhua, China and Suzhou, Shanghai and employ more than 250,000 workers combined. (3, 4, 5) Apple Inc. is a publicly held corporation that is traded on the Nasdaq under ticker symbol AAPL. In third quarter, 2007 annual sales for Apple reached $24 billion, up from $19. 3 billion in 2006. Product and service lines at Apple include lines of MAC Computers, iPod and Apple TV, iTunes, iPhone, and downloads to any of the existing product lines from a series of downloading hosts. (3, 4) PRODUCT INFORMATION Apple iPhone
The iPhone is considered a smartphone because of the amount of information it sinks and loads. This revolutionary new product is also a widescreen iPod, a breakthrough internet device, and a high technology cell phone that includes basic and many not-so-basic features as a regular cell phone that include contacts, calendar events, e-mail, photos, music and video, and an iTunes account. The iPhone is used as a regular cellular device with additional features that make it comparable to a blackberry and an iPod all in one small, technological device.
To use the iPhone, a consumer is able to program all information that he/she wants to have as features on their phone. This makes life simple as most phones come already programmed for the consumer. This product will be customized to each individual. The screen is large for easy viewing and includes state-of-the-art touch screen technology that include over 300 patents, that no other phone, up until its release, could duplicate.
The iPhone stands 4. 5 inches tall by 2. 4 inches wide and weighs approximately 4.8 ounces. It is comprised of two colors black and silver and includes a 3. 5 inch widescreen multitouch display. (4) Product Information (Packaging, Warranty, Pricing) The packaging of the iPhone is set in a box that is black with a picture of the iPhone on the front. In the box there is a stereo headset, dock, dock connector to USB cable, USB power adapter, documentation, and a cleaning/polishing cloth. To see the actual packaging and reveal of the iPhone, you can go to Youtube. com and type in iPhone packaging.
Though every iPhone comes with a one year hardware repair coverage warranty and two years of technical support, consumers are urged to buy the “Apple Care Protection Plan” that extends the warranty and expert telephone support for 2 more years for the price of $69. The price of the iPhone is now $399 for the 2007 Christmas season which is down from the original price of $599 at the introduction of the product.
Promotions and Distribution The Apple iPhone is promoted virally through the internet and Youtube. com and also though TV commercials. Youtube.com has over 15,000 videos on the iPhone at their site that instructs consumers how to better use their product including all the features and benefits in short demonstrations. You can even watch the unboxing of the iPhone that has been seen over 4 million times. Another promotion for customers is $100 rebate on the product for people who bought the phone before August 22, 2007. As for distribution, you can buy an Apple iPhone on the Apple. com website, visit any of their over 300 Apple retail stores, or over 1,800 AT&T locations across the U. S. (4, 6)