One of the success factors for the iPod was the fact that it emerged is the only "brand" in the MP3 player market. Despite the fact that there were many MP3 players that predated the iPod, Apple created the most user-friendly device at the time and then, when an eco-system grew up around it, the only brand in the segment.
Putting aside the third-party accessories, feature for feature there weren't so many things that were unique about the iPod vs. rivals like Creative's Zen player. But in the eyes of consumers there was really only one device: the iPod. Competing MP3 players became imitators or "wannabes" in the mind of the consumer. The iPod has about 70% of the market share for MP3 players in the US.
The iPhone appears to be heading in the same direction. A significant caveat in the U.S. is the AT&T exclusivity that could limit sales somewhat.
A BusinessWeek article this morning broadly and speculatively explores the impact of the iPhone on competing handset makers and carriers. We've already seen the market respond with various "iPhone killers," both in the market and yet to be released. On the growing list are the LG Voyager, HTC Touch (and Touch Diamond), Samung Instinct, Blackberry Thunder, Nokia Tube and so on. So far none have lived up to the promise of the label.
Sprint is running a Cinema/TV campaign in which the Instinct is favorably compared with the iPhone in quotes that appear on screen at the end: "An iPhone killer;" "Zippier download speeds than the iPhone." But that was the previous version of the iPhone they're talking about.
Recently, Walter Mossberg of the Wall Street Journal posted a mixed review of the Instinct that basically condemns it to "also-ran" status.
The more "iPhone clones" there are in the market the more the brand of the iPhone is reinforced as authentic compared with rival offerings, which become perceived as inauthentic or imitators in the same way that happened to MP3 players competing with the iPod.
There are devices in the market that feature touch screens and better cameras, browsers with flash support or other features not found on the iPhone. But nobody has yet developed the ecosystem around their phones that the iPhone has. This further differentiates the device and helps it stand out. Blackberry and Android, in particular, are very focused on creating an apps ecosystem. However, they've yet to bring them to market. The iPhone will likely have a lead of at least 6-8 months on rivals in that regard.
The only way for rival handset makers to shake off this growing "imitator" or "wannabe" perception is to actually build devices that outperform the iPhone across several key categories or present a next-level of innovation comparable to what the iPhone offered when it came into the market a year ago.
Both will prove very difficult indeed.
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Related: T-Mobile to offer the iPhone for 1 Euro in Germany.
Samsung is making phones from plastics derived from corn; this could add a "green" cool factor that might appeal to certain market segments.