The Apple iPhone - July 2007

Will this much-anticipated new entry to the smart phone market live up to the hype?

After years of rumors and rampant speculation, Apple finally released its much-anticipated iPhone in late June. Apple's entry into the cellphone market has been one of the most hyped new technology product launches this century. TV networks covered the iPhone’s debut like a Hollywood premier.

Although reviews on the whole have been positive, is the iPhone right for you? Will it change mobile phones forever, as some claim? And before you throw out your Blackberry or Palm, just what does this “revolutionary” smart phone do? How is it different than what’s on the market currently? And what value does it bring to real estate professionals?

What Is the iPhone?

Most people already know that the iPhone is a type of ‘smart phone’. These are mobile multimedia and internet-enabled devices that extend the functionality of the cellphone into the realm of the personal computer. Smart phones not only allow users to make standard voice calls, but also provide access to email, calendars, personal contacts, the Internet, music, video and various other functions. Similar products on the market today include RIM’s BlackBerry, the Motorola Q, and the Palm Treo.

The iPhone combines a standard mobile phone, an iPod, a camera, and several internet applications into one sleek package behind a 3.5-inch glass screen. Two models are available with either 4 or 8 gigabytes of memory. The face of the iPhone has only one button, relying instead on an innovative touch screen and virtual keyboard. Buttons for the 16 main applications are located on the home screen. The 4-gigabyte model retails for $499 while the 8-gigabyte model costs $599.

How Does It Work?

The iPhone works like any other mobile phone, relying on a carrier’s cellular network to complete a call -- in this case AT&T, which has a five year contract as the iPhone's exclusive carrier in the United States. iPhones must be attached to a personal computer (PC or Mac) with the latest version of Apple’s iTunes software to be activated. Current calling/data plans range from $59.99 to $219.99 per month plus taxes and a two year contract, in addition to the cost of the phone itself.

The iPhone has several innovative features. Unlike most other phones, the iPhone does not use a stylus or keypad, relying instead on bare fingers. Other than a power button, a mute button and a volume switch on the side and a ‘home’ button on the face, all other functions are handled by a ‘multi-touch’ touch screen. Different motions, finger combinations or taps will cause different results depending on the application. For entering text, the iPhone uses a virtual keyboard on the touch screen with a built-in spell check and predictive spelling functions. As the user types, the phone will guess the word allowing for quicker data input. Several reviewers thought the touch screen and virtual keyboard would be a significant liability to the iPhone, but have since found them to be non-issues.

Scrolling on the touch screen is also different than with most mobile devices. Users can ‘flick’ rapidly through lists, such as contacts or song titles, as if the names were attached to a wheel. The list will continue to spin for a few seconds after the finger is lifted from the touch screen. When viewing web pages, placing your finger on the touch screen locks it to that section of the page, allowing the user to drag the page much as one would move a piece of paper. Zooming in and out on web pages or photographs is done by pinching or unpinching your index finger and thumb. Another nice feature of the iPhone is its accelerometer which senses the orientation of the phone and adjusts the screen image accordingly, either landscape or portrait.

The iPhone is one of the few smart phones to be able to access Wi-Fi wireless networks. The phone automatically searches for available networks (often found at coffee shops, cafes, and libraries) and connects automatically. The web browser is a version of Apple’s own Safari browser and will display most web pages normally, though without the animation or blinking of Flash or Java. The iPhone also links to Google Maps, displaying street maps, local lists or aerial photos for any address. Live traffic information is displayed by color coded roads on the map.

iPhone connects to popular consumer email services, such as Yahoo, Gmail, AOL and Earthlink. It can also handle corporate email through Microsoft’s Exchange system. Although Blackberry email services cannot be used on an iPhone, Yahoo Mail provides a similar service to ‘push’ email to the phone. Voice and email are displayed as lists so messages can be retrieved in any order. Incoming email messages are fully formatted, including graphics. Users can open and view - but not edit - Word, Excel and PDF attachments.

While the iPod is similar to what can be found in the latest stand-alone models, it does incorporate a few new features. Cover flow, found on the latest version of iTunes, has been added, allowing the user to scroll through songs and albums as if they were browsing record bins in a store. Apple’s standard earbuds for the iPhone have a mini microphone and the ability to pause a song or to answer a call by pinching the cord.

Drawbacks

With all the hype, the iPhone does suffer from some negatives. The most commonly cited problem is its reliance on AT&T, perennially low in customer service ratings. Unless you already use the carrier, a switch could prove costly. And even if you are an existing customer, the iPhone does not use AT&T’s faster cellular data network, instead relying on its slower but more widely available EDGE service. That means unless you are tapping into a Wi-Fi network, data transfer will be painfully slow. Don’t even think of watching YouTube with EDGE.

The list of what the iPhone lacks is almost as long as its innovations: there’s no memory card slot, no chat program, no voice dialing. You can’t install third-party programs, the camera doesn’t have a flash, you can’t send photo messages, you can’t capture video, and most egregious of all considering this is an Apple product, you can’t buy songs directly from iTunes, nor can you set any of your songs as a ringtone. Apple does promise that future models will address some of these concerns and the phone will eventually migrate over to AT&T’s faster network. There’s also space on the home screen for another row of application buttons which makes one wonder what’s to come.

Impacts on REALTORS® and the Real Estate Industry

The iPhone potentially could be a valuable tool for REALTORS®, although at this point it is probably more flash than substance. With high-speed data transfer limited to areas with Wi-Fi networks, the phone is not a reliable device for tapping into listings in the field to show clients. The iPhone doesn’t support Flash or Java software, which means most virtual tours are unavailable. Before the iPhone can become a valuable tool for real estate professionals, functionality will need to be improved along with the speed of the wireless connection. Users should view this model of the iPhone as version 1.0. Apple has promised enhancements will follow.

But once that day comes, what then? Some industry bloggers are already dreaming big:

Imagine this: your client is driving through a neighborhood you serve, and they receive an RSS notification that there is a new listing available to view in that area on their iPhone. They can now immediately view the video listing on their phone, get detailed information about the property, research the area & even contact (call OR email!) the seller for more information...all from one device that sits in their pocket wherever they go!

Prospects & Potential Uses

Apple is known for its integrated and stylish designs. The iPhone certainly has plenty of both. As previously stated this current model should be viewed simply the first version of iPhone. Although it incorporates many unique and innovative features, more will be added in later models. Apple has said it expects to sell as many as 10 million phones by the end of 2008. While the iPhone will not capture a major share of the mobile phone market, it is looking to become a very profitable part of Apple’s future.

Probably more important for the mobile phone market is that the iPhone has raised the bar for other manufacturers. They will need to incorporate some of the iPhone’s new features into their models to remain competitive, at least in the U.S. The general trend toward a convergence of the telephone, television and personal computer has been discussed for over a decade. The iPhone is simply the next step in the process. Other manufacturers may use the ideas put forward in the iPhone to drive their own technology forward. Already some Korean firms are exploring touch screen technology. So while you may not rush out to buy an iPhone right now, somewhere down the line you will probably have something similar.

- Dave Shumaker

NAR Information Central's Technology Report - No. 84 (July 2007)

For Further Reading

Check the Center for REALTOR® Technology's detailed hands-on review of the new Apple iPhone.

Apple has a very informative 20-minute video ‘guided tour’ to the iPhone on its website explaining much of the phone’s functionality.

Questions or comments?

Send an e-mail to NAR Information Central's Technology Report.