Thursday, January 19, 2006

Apple Drops Hints of iPod Phone

Four trademark applications submitted earlier this month by Apple are adding grist to the rumor mill concerning the launch of an iPod phone, which has been the subject of speculation almost since the launch of the company's popular digital-music player.

As filed with the U.S. Patent and Trademark Office, the applications for the term "Mobile Me" cover a litany of technologies ranging from telecommunications and satellite networks to computer services and portable devices.

Apple already has a presence in the mobile-communications realm with the iTunes-enabled Rokr phone from Motorola, which, by most accounts, has not lived up to expectations and has suffered poor sales as a result.

But possible efforts by Apple to push further into the mobile market with an iPod phone have drawn mixed responses from analysts.

New Playing Field

"They certainly have the potential to deliver an iPod phone, based on their design skills and the iTunes platform, but they would be entering a field where they have never played before," said IDC analyst Dave Linsalta.

He cited several possible challenges for Apple, including decisions regarding mobile-network partnerships and sales channels for an iPod phone.

"The company likes to control the distribution of its computer hardware, but with a phone they would need an agreement with wireless operators and would have to license the device," said Linsalata. "There are a significant number of core competencies in telecommunications that Apple lacks."

Still, the analyst said that the iPod has a strong following that could be extended to the world of phones. He also said that Apple could create its own mobile virtual network, much like the one Virgin has created, and offer phone services by leasing network access from an established carrier.

Matter of When

Yankee Group analyst Michael Goodman contends that it is only a matter of time before Apple introduces its own mobile phone.

"They certainly have the ability to do this," he said. "Apple strongly believes in vertical integration and controlling the design process, but the question is, 'How do they get into the wireless side?'"

Goodman suggested Apple could focus on device manufacturing only, or get more involved as virtual-network operator.

"The company most likely will add more wireless capabilities to the iPod as well, enabling communications between devices or between the player and wireless networks," he said.

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