Fast Company

Why Apple's Next iPhone Is As Important As The First One

Apple's next iPhone already have you hot, bothered, and insanely curious? You're not alone. And there's a good reason for it, too. For Apple, and for consumers the world over, the next iPhone may be Apple's most important edition since the first one rocked the cell phone world in 2007. There are two reasons why.

Design

Check out the video below. It's of some leaked parts of the purported next-gen iPhone, assembled to give you a sense of what the device will look and feel like in your hand...all that's missing is the electronic guts that actually make it work.

Enough of these leaked parts have arrived that we can be pretty confident this is likely to be genuine. The phone is slightly slimmer than the current 4S, and has a bi-material back face that seems to be part metal part plastic--probably more resilient to drops and impacts than the 4S is with its prominent glass front and back pieces. It looks like it has a bigger 4-inch screen, and the video shows why this is a great size: It's just about possible to touch most of the screen with a single hand grip on the phone (try doing that on a 5-inch screen, and it'll be tricky). The base has room for the new-style small dock connector, but other than this it's familiar.

While these details are interesting, the design itself tells us something about Apple: It's very much a design evolution, carefully thought out and seemingly incorporating lessons learned from earlier versions and the milled-metal chassis techniques Apple's been using on its iPads and Macs. It's also new and unusual looking, while being instantly recognizable as an iPhone--you're not going to mistake it for a rival's device. Court filings from the protracted Samsung case suggest this is a design whose origins are a concept device codenamed Purple that dates from 2005. Basically this is a classic Apple tactic, one that it's used on its other devices with great success--design, refine, then completely redesign...and repeat.

This phone is also going to shape the smartphone market the world over for the next year or two. Like it or not, because it was first the iPhone really is the gold standard in the new smartphone world...and more and more of us are ditching our dumbphones and adopting smartphones the world over. Think of the iPhone for 2012 as the phone equivalent of the MacBook Air--a super-slim mix of plastic and metal that represents the peak of slowly evolving laptop design, and one that's prompted a whole new class of portable computers that are designed to be curiously similar to it.

This is important because the next evolution of the iPhone, in a year or so's time, may be into something radically different. It almost has to be--there are few new directions Apple can evolve the phone in that marry to its clean design philosophy of thinner, simpler, smarter. So 2012's iPhone may be the peak of the device that debuted in 2007 and changed how we access the mobile Net and think about touchscreens, photography and casual gaming. It may even be the end of the iPhone's beginning.

Money

Apple's last quarterly finances seemed to disappoint Wall Street, despite the fact that as the world's biggest company it achieved year-on-year revenue growth and improved margins--a duet of facts that any company of any size would be proud of. But analysts expected Apple to sell more iPhones than the 26 million it did, and punished the stock price as a result. Apple explained that poor sales in financially damaged Europe and a slow down in sales ahead of the next iPhone were probably to blame.

And if you think about it, that's a crazy, and yet totally plausible fact: The average phone-buying citizen is now aware of Apple's yearly update cycle and is excited enough about the prospect of a new phone that they're holding off buying the current, very capable, highly applauded device for a period of up to five months. More and more, the iPhone is becoming a signature device for Apple that can influence millions of people's buying decisions.

As such, it's vital that they get the iPhone for 2012 absolutely right. It has to technically amaze, and sell like the blazes.

The selling part is even more important than you might think, because recent statistics show that Apple makes around twice as much profit selling a single iPhone as it does from selling an iPad unit, and it sells many more iPhones than iPads (at least until the rumored iPad mini goes on sale at a lower price point). Part of this profitability comes from design efficiencies in Apple's production line process, part of it comes from carrier subsidies. The production efficiencies are important because they let Apple make twice as much money from a similar device than Nokia does from its flagship Lumia 900 device. The subsidies are important because carriers are desperate to sell the iPhone to their clients, tying them into long-term contracts where they can earn revenues from the high data consumption the iPhone promotes. Carrier subsidies may be slipping as this business model begins to get old, although Tim Cook made a point of arguing the opposite during Apple's earnings call.

It's being guessed that the iPhone for 2012 (iPhone 5? iPhone 6?) will sell so many units globally that it'll achieve 170 million units sold for fiscal year 2013--roughly one new iPhone sold for every two U.S. citizens. The iPhone drives over 50% of Apple's profits. The latest rumors say it'll be revealed September 12, so we don't have long to wait, at least. 

What will all that money let Apple do? It might let it launch a radically new device (like the long-fabled HDTV) or, more importantly, it could let Apple take a big risk, and launch a wearable computer that competes with Google's Project Glass, but bringing Apple's design cool and the iPhone halo effect with it. 

[Image: Flickr user David Pham]

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17 Comments

  • Robert Gold

    If the new tech era appears in December 2012, we won't be making calls anymore. Apple might call mobile units iMoble. Apple, Microsoft, and Google are probably getting word of a simple shift that will at first annoy them as they contemplate scraping (altering) their plans for the next seven years.

    They are very bright people at these organizations that will see the obvious simplicity of a new era. For some it might seem too simple, but I doubt it will for these giants.  What does it mean for you and me? We get to live in a technical environment wherever we are that anticipates our desires and supports our actions each moment as we become ever increasingly effective each day.
    Forget about iPhone 6. An organizational scientist educated to reorient, has reconstructed technology, communication and the very structure of accounting. If everything keeps moving forward as in the first three weeks in August by December, we will be "dwelling in a new world."

  • mrmrsf

    The flat black on black is aesthetically beautiful but also very appropriate. In the evolution cycle of Apple's color palette it makes sense. Most importantly, how evoking is it that apple nods to the death of Jobs by doing all of their products in black. It's beautiful.

  • Aureliano d'Agazio

    I think there is a lack in this article: the very important fact that with the first iPhone Apple was setting new standards in the consumer imagination and changing the game, now Apple is moving following what some other did before (size, that's not a tiny aspect, I still recall when Apple said that any size bigger of 3.5" was totally useless).

  • Rochelle Fainstein

    I just got the Galaxy s3 and see no reason to move over to an iphone with this iteration. Samsung has done an amazing job creating a phone that distinguishes you from all the cracked iphone carriers. I think an important point, which I assumed would be mentioned, is the fact that this phone needs to do well post-mortem of mr. jobs. It's a morale booster after the fearless leader has gone- even a year later- at least, it should be. 

  • Nicholas M. Cummings

    iPhone has better app selection, takes less steps to make purchases, and takes far far less steps to change settings.  do I miss widgets on my Droid 2?  Google Voice which was far better than Siri?  do I miss that physical keyboard?  yes, but I don't miss bloatware.  at least my iPhone's unremovable apps sync in things like my iTunes library, while putting media files on my Droid was a multi-step chore ... the bloatware on my Droid 2 was absurd, the battery life was worse, and the memory management was *terrible*

    I'm pretty happy with my switch from the Droid 2 to my iPhone 4S.  Plus the hardware is more beautifully designed.  I'd only consider switching to the Galaxy, which is a push, or the Lumia 900 which is an entirely different animal.

  • Elliott Hansen

    Less steps to make purchases? I have to type in my password every time I want to buy an app on my iPod. On my android I have to check the box to agree to the terms and then accept the charge.

    Android has evolved a lot since you got your Droid 2 (that phone wasn't even that good in my opinion). Try to avoid basing your entire android experience off of a sub par phone.

  • Nicholas M. Cummings

    I know they changed the purchase format for Google Play, but the bloatware lives (and consumes memory and battery)

    I stand by my assessment. It must have been too objective in weighing the advantages of both platforms for your liking

  • Durgesh Kumar

    Nice Post KIT EATON...
    iPhone... (No Comments :) )   True. not much aware about what lumia has achieved, but yes, one x has done well to the consumer's perception right from the touch screen to the technology inside...Android OS has been spreading like virus even being fragmented. People put their ears to awe if the handset in hand next to them is running Android...Handset manufacturers have enjoyed this it seems...Where's RIM's BlackBerry??only a 1700$ handset and octopus keyboard?(Octopus keyboard articles are more captivated by idevice's forums :P )

  • Prakash

    not sure if its just me.. i feel the new iphone back part looks horrible.. that piece of grey metal looks like an odd patch... this cant be an apple design

  • robinkristianparker

    I really can't see how any iPhone from hereon in could be as important as the first one. The first iPhone was a revolution; the iPhone 5 will be an evolution

  • AnonUser

    just curious what may be so important about this phone? will it make calls and receive texts in a way we can't even comprehend? 

  • Info

    Hyperbolic and very slanted article. As I post this comment from an iPhone 4 I'm very intrigued by the Samsung release and turned off by Apple's legal insecurities (not to mention the big 5in Samsung screen is sexy and useful in-hand). Best of luck to Apple but things are going to get tough. Look forward to what shakes out for us lowly consumers ;).

  • Vansh Kapil

    aah too much pressure .. That is alot of anticipation. I think this time around competition is much tougher. I believe iPhone has to perform out of its skin to meet these expectations. Not that it will not be a successful product, I am sure with the kind of momentum iPhones have had this will be another blockbuster hit. 
    Problem is that market is saturating, replacement market is the key and a huge chunk of mind share of that market is grabbed by Galaxy S3 and One X. There is only so much a market can stretch. 
    I believe that with a price drop iPhone 4s would be a bigger hit on arrival of the new iPhone.

    Lets wait and watch.

  • Jarmo Matilainen

    Good article, which clarifies the smartphone market situation and near future. Apple is a great company and iPhone X (X=1..6) is a great gadget and I hope that their success will continue.

    But, there are two things, which I want to challenge:

    Firstly the touch screen user experience and desing are nothing special and hot anymore for most of us. I want to see much more developed solutions for user interface than wiping the screen with finger - it's something that 3 year old children do daily basis not what we are capable of - the smartphone should be better integrated to our senses - and I mean more than speech recognition.

    Secondly if the user experience and design is already seen in many devices, why pay too high price ang margin from something, which is not hot ? If Apple has so good margins I believe that people are soon opening their eyes and waiting that the price go lower and maybe they are waiting to get something really hot - like iPhone was when it was launched many years ago ?

    Android and Lumia ecosystems are in a same situation - I have openend my eyes and started to think about this ...