That iTunes Phone is Coming, Again...

Posted by: Olga Kharif on August 23, 2005

We’ve been hearing for months that Motorola will release a cell phone running Apple’s iTunes. Yet another confirmation that the phone will be released, despite all claims that Motorola has pulled the plug at the last minute, came this Saturday, when the Federal Communications Commission posted a document indicating that it’s approved the phone for sale in the U.S.

Frankly, I am surprised that anyone has had any doubts that this phone will be released — by September, as Motorola has previously said. This is Motorola’s most anticipated upcoming product; so why would the company axe it? Plus, unless Motorola releases the phone now, it risks losing ground to cell phone makers that are coming out with new music phones.

Sure, the details of a partnership between Motorola and Apple have had to be ironed out, that's why the phone hasn't been released already. Offering a cell phone music service, and figuring out how to do revenue sharing between the two companies is not easy.

But there's no doubt in my mind that the phone will come out, since the product's cancellation will deal a blow to both Apple and Motorola. Both companies' investors are counting on it.

Besides, if Motorola waits much longer, it will fall behind its main competitor, Nokia, whose new N91 music phone is getting rave reviews. Motorola was late to market with camera phones, and it lost market share, big time, as a result, a few years ago. I am sure the company isn't keen on repeating the experience this time around, when music phones just might be the hottest new gadget on this year's Christmas lists.

TrackBack URL for this entry: http://blogs.businessweek.com/mt/mt-tb.cgi/

Reader Comments

Jim Hughes

August 24, 2005 06:35 AM

The main reason that people are wondering about the iTunes phone is that it's so far behind the curve even before it's been launched. It would have been an average phone a year ago; it's now just mediocre.

Apart from the iTunes integration, it offers far less than many other music phones. Personally, I think it's such a dud that not even the iTunes integration will save it.

John

August 24, 2005 12:39 PM

Olga,

You forget to mention the control the top carriers have in the U.S. regarding which handsets get to come to market. Obviously, they don't want to offer a music phone that will circumvent their network like the current iTunes model does.

When you add in the music labels, who see consumers paying up to $3 a pop for a 15 second ring tone, then it's even more difficult to figure out revenue sharing or pricing for that matter.

Personally, I think it'll be more of a blow to Motorola if the handset never sees the light of day. Apple has other options (i.e. other manufacturers or establishing its own MVNO service) and an ever-increasing, built-in cult audience that would love to get their hands on an iPhone.

John

Post a comment

 

About

BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

Categories

 

BW Mall - Sponsored Links

Buy a link now!