I've already written that Apple's obsessive control of the App Store and the open source nature of Android will doom the iPhone. Today, it's all about how the iPhone 4's high cost will spell the end.
A computer's price is usually the greatest factor when you're looking to buy one. That's why HP sells five times more computers each year than Apple. It's no wonder, when the HP Pavilion laptop starts at $579 and the Apple MacBook Pro costs at least $1,199.
Apple's strategy is to build expensive high-quality machines that appeal to a niche audience of computer users who are willing to pay up. I actually own a three-year old MacBook Pro myself, and am typing these very words on it (so take that, Apple Fanboys who think I'm anti-Apple!).
When the iPhone was the only phone like it on the market, Apple could afford to charge whatever they wanted with little competition. What were you going to do, buy a Palm phone? Please.
The world has changed quite a bit since the first edition, however. The iPhone 4 now has a worthy adversary in the form of Android. Not just in terms of style and the quality of apps, but the Android is priced much lower than the iPhone.
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Yesterday, I wrote that Google is only concerned with getting you online, so you can do more Google searches. Apple's not. Google lets any cellphone maker use the Android operating system for free. The iPhone operating system is expensive, and besides, you can only get it on the iPhone.
Android phones cost significantly less than the iPhone, in large part because Google's operating system is free. The 32GB iPhone 4 costs $299, while Android phones like the LG Ally cost $49. Some Android phones have even been offered free with contract.
The Android offers many of the same features as the iPhone, and is equally stylish, but much less expensive. Apple could fight this insurgency by cutting prices, but, um, have you seen the prices in the Apple Store? Apple made its name charging more than $3,000 for a great desktop computer, not low prices.
Apple's market share will fall precipitously as more users abandon the iPhone for the more economical Android. That's not to say the iPhone will die. I believe the iPhone will become in the phone market what the Mac is for personal computers: a niche product for affluent customers.
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Android's Openness Will Doom iPhone 4
New iPhone 4 Won't Stop Android
Photo: Justin Sullivan/Getty Images
Tags: Cell Phones, Electronics
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