Living with the iPhone

For those of us who have a hard time deciding what to eat or where to dine out, Urbanspoon has made a slot machine/roulette application (complete with 'pull' slot machine sound effects) to help us make a decision on where to eat. The application will determine your location from the GPS feature (which is still a pretty marked and powerful feature to the iPhone 3G that invariably raises privacy issues) and you can select he criteria you want, i.e., neighborhood, cuisine and price. And, for some inexplicable reason, you literally shake the phone to activate the selection feature. The wheels spin and your restaurant is selected (Alternatively, you can push the button too). It's a kind of Magic 8 Ball effect. Strange, but amusing.

Urbanspoon with its gourmet result.

(Credit: Kevin Ho)

All sounds good in theory, but in actual application, it's a little, well, beta. "California cuisine" encompasses a sweeping and surprisingly large number of restaurants. Also, the $$$ price guide is a bit off with some joints being way above and some being way below. And, in terms of content, well, given that San Francisco's Mission District is home to many Top 100 Restaurants, Burger King was definitely a surprise result.

How 1.0 iPhones use battery life with the 2.0 firmware and all those tantalizing applications is something that may be worth considering against the iPhone 3G's voracious appetite for power. During the past weekend, as new applications get tested out, I've seen the iPhone 3G use more and more power with the charge indicator gradually slipping away, ultimately flashing the "low battery" warning. This warning wasn't something common with the 1.0 iPhone I had. In fact, I had never seen that "low battery" indicator even after 7 days of camping-like condition on the AIDS Ride.

Of course, with 3G, improved sound quality, GPS locating, and very loud ringer, it would make sense that battery life would suffer. Short of putting a stick of plutonium in the iPhone 3G, it would seem a safe bet that power chargers will get a good workout with the iPhone 3G. Invariably, battery fatigue will soon follow and Apple will have a secured a revenue stream of captive iPhone users who will eventually shell out $80 for battery replacement. That or third-party chargers for cars (or solar chargers) will see increased sales. Either way, this is where the 3G falls short.

Loopt has an appealing application that allows you to track your friends and allows them to track you on a graphic map. It's kind of like a GPS-sonar radar that I've just discovered on the iPhone 3G. But, is this application really more like an electronic leash? Will your significant other track you? Will moms and dads track their children this year? Yes, Loopt has an extensive privacy policy that discourages/prohibits kids under 14 years old from using the service, but even one of my most 'public' friends (both online and in off-line) was actually hesitant about installing Loopt on his iPhone 3G. Disclosing your location to a third-party seemed to bother him greatly. The thought is that if you're near a store that is having a special you may get an SMS-text bulletin or coupon. The ultimate direct-marketer's dream once Loopt obtains some demographic information. Your movement patterns are one thing, but add-in your physical location, shopping patterns, travel patterns... You've become a human cookie.

To me, it's not necessarily the third-parties I'd be concerned about, but would disclosing your location to first-parties, i.e. your friends and family, be the best thing? We are all entitled to privacy of course. (Well, penumbras of privacy under the Constitution). Some choose to have Dick Cheney-like undisclosed location privacy, while others have Martha Stewart ankle-tracker privacy. But, balancing privacy requires takes a certain amount of prudence (or sanity perhaps) that will evolve as the line between public and private blurs even more. At least, at this point, Loopt allows you to opt out and only updates your location when the application is launched. What happens then you can't opt out any more? That'll throw all of us for a loop. (Sorry for the pun).

Was it worth the wait? The 5-hour phone service/text/data outage? Do you really have to get the new iPhone on the first day? The first weekend? From a rational point of view, the answer is probably not. But, from an admitted early-adopter Apple-phile, a resounding hot tamale train YES is the answer. But, this is not without caveats of course (battery life, hassle, and jittery/buggy application crashes). Overall, the new iPhone 3G is slick. The applications (which work 90 percent of the time) are even slicker (many worth special attention to come in the next few posts). Sound quality is much improved. The handset feels bigger, but is lighter. It's more than a refinement over 1.0, but I wonder if that has to do with the 2.0 firmware update that allows those long-awaited, legitimate third-party application bringing in outside innovation.

iPhone 1.0 say hi to iPhone 3G

(Credit: Kevin Ho)

In any case, with the white 3G version that yours truly got, people stop and notice and ask questions like they did last year. Today, I've already had two people stop and ask about the iPhone when they noticed it wasn't the typical one that we all have grown accustom to seeing. Sure, they've seen iPhone before, but when they spotted this one, which is different (it's white for Pete's sake) they stopped and asked to see it and the new applications with a lot of attention paid to the GPS-maps feature (deservedly so).

The fact that people stop, look and ask, and that there are still long of people willing to spend part of their weekends in line is pretty fascinating - even given the tough economic that 2008 had over 2007. As the Field of Dreams quote goes: If you build it, people will come.

It didn't take a check of other CNET stories to confirm that Apple/AT&T's registration servers have either went back to bed or checked out early on a Friday. After the cheers at 8:00 a.m. the line moved less than 20 feet within the first hour. There were at least two announcements from Apple reps (one in a utila-kilt even) that things are "a little bit slow," because of the "overwhelming demand." An insistent, we could always come back later was touted too.

At one point, I was getting discouraged. The Apple Store'ss WiFi connection was increasingly out of range as the line arced around itself. Laptop batteries were fading. Many with iPhones in line started to look antsy and bored too. A geek 2.0 shantytown was at risk of developing. Gripes about AT&T and it's 'ease' of in-store activation were heard. And yet, the line grew longer and added more people. Somehow, the line started to move - or maybe it was just my turn...

But, after 2.5 hours of waiting I was in! And yes, the white 16-gig iPhone 3G was indeed available. "Mike" my handy Apple assistant told me stories of the various difficulties that AT&T has presented to its new and existing customers. Rightly so, as I had to talk to an AT&T rep about my upgrade. Eventually, I won. But others in the store weren't so lucky. One customer apparently dropped his new iPhone 3G and returned it wanting another one. After processing that return, moments later AT&T told the customer he was no longer eligible for the 'incentive' upgrade pricing. Oops.

As for my iPhone is still begging to be connected to iTunes and I have yet to snych it yet. So, more to come. But at least I have one. And it was tax-free too.

Some things never change: Despite being a stranger in a foreign land (a San Franciscan in sales-tax-free Portland on business), despite only getting 4 hours of sleep and despite iPhone 1.0 waffling towards getting iPhone 3G, I found myself in line in front of the Apple Store at 7:00 a.m. in Portland, Oregon waiting for the new iPhone 3G. And, of course, I wasn't alone.

Can you see the line now? The line in front of the Portland Apple Store wraps around the Verzion booth.

(Credit: Kevin Ho on his old iPhone)

My goal: the white 16-GB iPhone. Will I get it? Only time will tell. But like last year's wait in San Francisco, those earliest of the early adopters are primarily male, white and middle-aged. There are free bottles of water, coffee and random post cards of iPhone 3G literature. There are many folks who are toting their 1.0 iPhones too. But, unlike last year, I haven't been in line for more than an hour, there aren't people hawking their places in line for profit, and there aren't the throngs of media (apart from your loyal blogger). And, instead of a release time of 6:00 p.m., early adopters are being made to get up early to adopt their iPhone 3G, well, early on in the day. But like last year, there buzz, excitement, and all that buzz that Apple has been successful at creating, not quite the same as the original, but a more 2.0-like version.

Strangely, I found myself with 30 minutes of free time yesterday. And, instead of doing something productive, I found myself drawn to watch the latest 30-minute iPhone 3G video from Apple.

Sure, it's that same creepy guy from last year, and this time, he looks even more CGI-generated than last. I think he gained some weight too. But, the new features made up for the the excessive use of "most advanced," "incredible" and other doped-up adjectives. Those are 30 minutes down the tubes watching this man, but, the 3G iPhone does look pretty enticing. No idiotic recessed earphone jack (a 'redesign,' really?), mass-email edits, Exchange services, slick Stek Trektricorder-like GPS tracking, finally allowing legitimate third-party innovation via applications... the list does go on. The bells and whistles showcased here did partially counter the weariness I've heard some of my friends fret about the ritualized procedures (and fee increase) that AT&T seems to have imposed on the 3G iPhone launch.

Being an attorney with an iPhone, I've wondered about the privacy of my SMS-text messages and whether they can be withheld from prying eyes. I don't mean that dinner date across from you, but in a larger sense. Think about what we've all begun to say via text messages: Carrie Underwood got dumped this way and Detroit's mayor was brought down by his text messages, for example. Like it or not, texting has become a communication medium that is here to stay, meaning that the contents of those messages are also susceptible to legal discovery, i.e., you have may have to fork it over in a lawsuit. The iPhone itself is purported of being capable of storing about 75,000 SMS-text messages. That is almost too much data in your hands! You could probably write a small novel with that amount of text messages. If you're like most people, you gripe about life and work inevitably. But, what if your employer pays for your SMS plan, can they have a peek? Especially if you go over a plan's limit? What if you're sending (gasp) personal SMS-messages on work phones?

Well, according to the 9th U.S. Circuit Court of Appeals, the answer is "no." An employer needs a sender's or receiver's consent before examining those messages. In a decision issued Wednesday, ( Quon v. Arch Wireless) the court (the highest federal court in the West short of the U.S. Supreme Court) said that the Fourth Amendment provides a reasonable expectation of privacy that extends into the world of SMS-text messages.

In the case, a city police department provided text-paging services for its officers, but had no clear text-use policy. Instead, the city relied on a general employee Internet/computer usage policy and tried to say that the SMS-texts were akin to e-mail messages. During an internal affairs investigation for excessive text-messaging charges, no less, the police department wanted to see if service-charge "overages" were work-related necessitating a better SMS-plan. After the messages were not on the PDA (d-for delete, anyone?), the city ended up getting the messages from the SMS-service provider itself. The appeals court determined the SMS-provider was subject to the provisions of the Stored Communications Act. Under that act, a "electronic communication service", like a SMS-provider, will need to get your OK before releasing the contents of these communications (which are akin to a sealed letter) because you have a legitimate expectation of privacy under the Fourth Amendment. So, for now at least, your SMS-text messages are safe from your bosses prying eyes. Is that a collective "whew" I hear?

With iPhone 2.0 coming soon, a question I've heard many a current iPhone owner wanting to get the next iPhone ask: what do I do with my old one? This emerging question highlights the early-adopter's plight against the law of diminishing returns. It's doubtful that a current iPhone will fetch more than $100 on eBay. But you never know. This presupposes that people will dump their old iPhones for a new one, but the incentives are there this time around especially with the lowered price, and given our disposable cell phone culture, it's more than likely that people will replace. (This leads to other questions: if you plan to get a new iPhone anyway, why would you buy Apple Care when a new iPhone comes out each year? And, now, with an even lower price, why bother?)

For those who haven't replaced with iPhones and bought them near to day 1 last year when the 1.0 iPhone came out, the clock is ticking to replace them. I've seen these original 1.0 iPhones with batteries that are deteriorating and many 1.0 iPhone screens and cases that are scratched, rendering them even less valuable once iPhone 2.0 comes out.

In my case, I've been a bit luckier as this is my third iPhone which means it's still relatively 'new' (if not refurbished). There hasn't been noticeable battery deterioration (yet) nor is the iPhone scratched especially after I encased it in plastic - sounds like a good eBay tag, doens't it?

Given Apple's previous willingness to swap out iPhones over this past year, will Apple see a sudden surge of iPhones returned this month before the 1-year warranty window runs out? Will this willingness to accept returns for 1.0 carry over to 2.0 and be as generous? After all, when they replaced my dropped iPhone they said it was for research purposes, presumably for the 2.0 iPhone, but if this carries over to 2.0 iPhones is not clear. With mandatory in-store activation and a lowered price point, it doesn't seem like 1.0's goodwill will carry over into 2.0.

A newly negotiated deal with Apple could hurt exclusive U.S. iPhone carrier AT&T in the short term, but the cell phone carrier sees a big upside for the future.

Following the much-anticipated launch of the iPhone 3G at an Apple event in San Francisco on Monday, AT&T announced that it had struck a new deal with Apple. The new arrangement between AT&T and Apple is similar to other contracts AT&T has negotiated with other smartphone manufacturers such as Research In Motion and Samsung.

(Credit: Apple)

Since the first iPhone was launched last summer, AT&T and Apple have shared ongoing revenue from iPhone users. But now AT&T will pay the upfront cost for the iPhone 3G and subsidize the total cost of the phone by making customers agree to a two-year service contract.

The arrangement will benefit consumers by allowing the new iPhone to be sold at a much lower price point. The 8GB version will cost only $199 and the 16GB version will sell for $299 with AT&T's subsidy. This puts the iPhone on par with other smartphones such as RIM's BlackBerry and Samsung's BlackJack.

But the new deal comes at a price. AT&T executives said on a conference call with analysts and investors on Monday that the arrangement will put pressure on the company's profit margins and dilute earnings for the next year and a half. That said, the company believes that the new price point and improved Web surfing experience of the iPhone on AT&T's 3G wireless network will drive sales of the iPhone and get more customers using its data services.

"Less than 20 percent of our customers have integrated devices," Ralph de la Vega, the head of AT&T's mobile business, said during the conference call. "And at the $199 price point we could have mass adoption and put the iPhone in the hands of people who have never surfed the Web on a phone."

What's more, AT&T sees iPhone users as highly valuable customers. Executives said that they are willing to make upfront sacrifices to get these customers on their network.

Specifically, iPhone users typically generate more revenue than basic AT&T cellular customers because they use more data services, de la Vega said. And with the new 3G capability and more applications coming to the phone, executives expect that to increase. iPhone users are also more willing to recommend the device to friends and family. And the churn or rate at which they drop the iPhone and the AT&T service is very low compared with customers using other devices.

"The 2G iPhone experience helped us understand what the customer characteristics are likely to be," Rick Lindner, CFO of AT&T, said during the conference call. "These are high value customers."

As a result of the new arrangement, iPhone users will subscribe to the same kind of voice data plans already offered to other AT&T smartphone customers. This means that as part of the two-year contract commitment, customers will be required to have at least a $39.99 voice plan. And they will choose from one of two data packages. Consumers will get the full smartphone data package for an additional $30 extra a month. Business users who want corporate e-mail can select a data plan for an additional $45 a month.

Update 3:59 p.m. PDT: The new AT&T iPhone 3G data pricing means that consumers will now pay $10 more a month for data service. The original iPhone data plan, launched a year ago, costs $20 a month. An iPhone 3G must be activated in either an AT&T or Apple store, and customers must agree to the two-year service contract with AT&T, de la Vega said.