3G iPhone creates buzz

The new 3G iPhone is creating substantial buzz. Check out Om Malik’s interview with Ralph de la Vega, CEO of AT&T Mobility.

http://gigaom.com/2008/06/09/att-mobility-ceo-new-3g-iphone-game-changer/

One of the concerns is that increase in mobile data usage for social networking, LBS or streaming video apps is going to cause a lot of network congestion on AT&T wireless network. Mr de la Vega is confident that AT&T network can handle it. For more power users of mobile data, the hope is that they are smart enough to use WiFi connection on the iPhone to download large data files instead of congesting the wireless network. A future filled with FMC devices like Femtocells only makes sense here. Femtocells will allow bandwidth hogging home wireless to pass on broadband wireline connections allowing the wireless network to remain somewhat available.

AT&T is taking some hits on its earnings estimates due to the lowered iPhone price and Apple is taking a hit as well as AT&T will no longer share the subscription revenue. But overall sales volume is expected to increase dramatically with the lower price and that is expected to more than compensate for the lower price on the device.

The new iPhone is loaded with good stuff. The App Store will allow for a slew of cool consumer and enterprise apps. The enterprise support is great with MS-Exchange integration. GPS is cool for LBS accuracy.

Nokia and RIM need not fear however. iPhone will only increase smartphone penetration increasing the size of the market for everybody. We feel the smartphones will cannibalize the non-smartphone cellphone market to some extent.

MT