Answers for Telecom Pros on Eve of iPhone Release

June 25, 2007 (Vol. 28, No. 13)

Here comes the “gadget guy,” the nickname telecom manager Robert La Fata has for one employee at Glen Raven, a North Carolina-based fabric company, who is always first in line to plead for the latest and greatest cellular technology. This time the request is for an Apple iPhone, but – to LaFata’s surprise – the man has come ill prepared and is easily dispatched. “I want one,” is the man’s only argument before slumping away.

Don’t count on deflecting iPhone requests at your enterprise so easily.

Apple is expected to end months of anticipation on June 29, as Steve Jobs promised, and ship between 50,000 and 75,000 devices to AT&T Mobility’s 1,800 company-owned stores and Apple’s 160 locations nationwide – an average of roughly 26 to 38 devices per store. At least that’s Merrill Lynch’s prediction. The investment firm predicts 200,000 to 300,000 iPhones will be shipped in the first month and 4 million within the year. Apple says it expects to sell at least 10 million iPhones by the end of 2008.

Neither Apple nor AT&T have yet to reveal how many iPhones they will have available when sales are permitted to begin at 6 p.m. on June 29. But drooling prospective buyers appear ready to form long lines to pay the advertised sticker prices – $499 for an iPhone with a 4 gigabyte (GB) hard drive or $599 for one with 8 GB – and sign a minimum two-year commitment with AT&T, the device’s exclusive wireless carrier for the next five years.

AT&T does plan to market the iPhone to business users, according to wire reports, but good luck even getting one to test. That’s what Jeff Mazzabufi, telecom manager for Hubbell, was trying to do recently when he contacted his national AT&T account rep. The rep was unable to secure even one iPhone for the Orange, Conn.-based technology manufacturer, despite the enterprise’s considerable relationship with AT&T – the network used by 400 of its 1,000 cellular devices, including 150 smart phones, Mazzabufi reports. The enterprise has a dedicated AT&T Web site, where Hubble employees can secure any of AT&T’s cellular device at a 15% discount. 

But the iPhone’s high sticker price and the fact that users will be forced to commit to AT&T are just two of the expected downsides of Apple’s coming iPhone.

Visual Voicemail Part of iPhone’s Bling Bling

There’s no denying the iPhone’s irresistible appeal. Rather than carrying a separate cell phone, Web browser/e-mail device and music player, users now may wield just one attractive 4.50-inch by 2.40-inch (it’s 0.46-inches thick) and 4.80-oz. piece of equipment to perform all three functions. By contrast, RIM’s popular Blackberry 8800 is 4.49 inches by 2.60 inches (0.55-inches thick) and weighs 4.73 oz.

Thanks to touch-screen technology, the iPhone’s screen can be quickly converted to a phone pad or used to type e-mails and text messages. So, while the Motorola Q’s screen is just 2.50 inches (measured diagonally like a television screen), for example, the iPhone offers a 3.50-inch screen.

There are a few practical voice features, too, including a first-ever visual voicemail on a mobile device that “lets you select and listen to voicemail messages in whatever order you want — just like e-mail,” according to Apple. Another feature will allow users to merge calls to create a conference call.

This is the cell phone the younger generations of execs are going to “have to have,” says Steven Atkinson, owner and chief consultant of E-S Technology Consulting, in Chestertown, Md.  Better cast off the “narrow-minded view” that the iPhone is simply an iPod that can make phone calls, as the “consumer-centered excuse” will only work for a short time before end users see their friends with an iPhone and want one of their own, he says.

No Exchange Sync, Slower Data Among 6 Critical Weaknesses

Still, to Michael Voellinger, VP of wireless services for Pleasanton, Calif.-based telecom consulting firm Telwares, the device isn’t enterprise ready yet and that will be reflected in the breakdown of buyers, which he predicts will be 90% consumer and 10% enterprise. One significant reason: The iPhone doesn’t sync easily with Microsoft Exchange.

While Apple says its smart phone will work with Yahoo! Mail, Gmail, AOL, and .Mac Mail, using iTune to set up the account, it requires the use of POP3 or IMAP email protocols. It’s an approach that your network administrator is unlikely to deem secure, notes Mitch Barlow, chief technology officer at UCG, the publishing company that produces Voice Report.

Rob Enderle, principal analyst for the Enderle Group, in San Jose, Calif., agrees. “Supporting an IMAP or POP client on Exchange is nothing an Exchange administrator wants to go through if they can help it,” he says. “They like to see native Exchange Server. That gives them a certain amount of control over what’s on the phone. You don’t run into little problems like somebody suddenly downloading all of their mail to the phone and deleting it on the Exchange Server.”

Gartner analysts also are recommending against allowing the device. The firm is expected to release a report Monday that advises enterprises to not let iPhones near their networks due to a lack of security features and support for Microsoft Exchange or Lotus Notes. There’s no ability to wipe the device if it’s lost, they note.

Additionally, direct push does not appear to be available on the iPhone, which means reverting back to getting your e-mails at scheduled intervals, not as soon as they are sent.

“I can’t justify getting the iPhone for anyone at that price except our uppers,” Glen Raven’s La Fata says, referring to the top execs at his enterprise. “It’s a consumer-based phone at this point that isn’t business ready.”

 Mazzabufi shares the same sentiments. “I feel sorry for anyone who would get pushed around by its employees into buying cell phones to listen to music and watch movies,” says the telecom manager, whose 400 combined smart phones chiefly include Motorola Qs, Treos, Cingular 8525s and Samsung BlackJacks.

Five other issues with the iPhone:

M Extra personal expenses and billing issues. To access many of iPhone’s features, users will have to set up an iTunes Store account and provide credit card information. This threatens to mix the cost of personal music and video downloads with enterprise-related voice and data expenses. Plus, while Apple boasts that its iPhone will be able to “display rich HTML email with graphics and photos alongside the text,” the feature is expected to be a big data hog.

Meanwhile, AT&T has yet to release specific billing or voice and data plan information related to iPhone, leading Wayne DeCesaris, VP of managed solutions for Tangoe Inc., to fret. “Split billing can be a real challenge,” warns DeCesaris, whose Orange, Conn.-based telecom expense management firm tracks expenses related to 475,000 cellular devices owned by about 100 enterprises.

M A slower data network. While AT&T continues to expand its use of its wireless data technology UMTS/HSDPA (400 to 700 kbps) [VR 4/2/07], the iPhone will be on AT&T’s older and slower EDGE network (75 to 135 kbps). AT&T spokesman Michael Coe argues that the network’s speeds are sufficient, however, since the iPhone comes with the ability to automatically link with any of AT&T’s more than 10,000 WiFi hotspots.

M Lack of third-party applications. There’s no software development kit for the iPhone, Voellinger notes, though Apple recently announced that its device will support applications written using Web 2.0 standards. And some applications already have begun to appear. For example, a Safari-based interface has been written for Digg.com, a Web site where users determine the top stories, reports MacDailyNews, an apparently pro-Apple information service.

M Drain on the battery. As recently as last week Apple announced that it was upgrading the battery that would be placed in its iPhone to one that will allow for up to eight hours of talk time, six hours of Internet usage, seven hours of video playback or 24 hours of audio playback. But what happens to the battery when users want to do all of the above consecutively?

Further complicating the matter is the fact that the iPhone is the only smart phone that won’t allow users to remove or replace its battery themselves, Enderle notes. Apple has yet to describe its replacement procedure.

On the plus side, the iPhone will contain a proximity sensor that detects when it is lifted to a user’s ear, turning off the display to save power and preventing inadvertent touches. Another power-saving feature is an ambient light sensor, which adjusts the brightness of the display based on its reading of light in the room.

M The reliance on a visual keyboard. Whether they should be doing it or not, heavy e-mail users will have a hard time typing or dialing while driving since they can’t feel the keys, Voellinger points out.

Hang On a Bit Longer or Consider Snazzy Alternative
 
So, given all of the above-mentioned problems, how do you avoid crushing the spirits of iPhone-seeking employees? Answer: Tell them that a “better and cheaper” version of the iPhone, with solutions to the above problems, is likely to come from Apple in the fourth quarter, Enderle suggests.

Atkinson agrees. There is no denying the hype over the iPhone, which Atkinson claims will be an “eye-opener for everyone once it hits the market.” But, if you can convince end users to wait it out a little while longer, a more enterprise-friendly iPhone will probably arrive that will make everyone happy.
 
Alternatively, Keith Shaw, the editor of Network World’s Cool Tools, recommends directing your employees toward real business-class smart phones, like BlackBerry devices. With the U.S. arrival of LG’s much ballyhooed Prada still uncertain, there may not be a new device as pulse-quickening as the iPhone right now, Shaw concedes, but there are a few devices that can generate at least a little excitement. The Samsung Upstage, for example, includes a music player and synchs with Exchange, though it does not come with a QWERTY keyboard. The BlackBerry Curve is the smallest and lightest of RIM’s QWERTY keyboard devices. Working on AT&T Mobility, like the iPhone, it also handles multimedia, including MP3s, and can be purchased for just $199 with an AT&T contract. (