Nokia N97, iPhone, and Modu Go Head to Head

Posted on 19. Jul, 2009 by in iPhone, Mobile

A lot going on in the mobile industry in the last few days and Israel is in the hot spot (no pun intended). Let’s start with the fact that all 3 cellular providers; Orange, Cellcom, and Pelephone recently announced that they will be launching the iPhone 3Gs over the next few months. The word on the street, and when I say street, I mean Twittersphere of course, is that at least two of the three providers bought 100 thousand iPhones from Apple. Now you have to understand that fact in the context that these providers max out at 150 thousand mobile devices sold annually! So out of the 150 thousand phones they will sell in 2009, 100 thousand will be iPhones?! I think it is safe to say we are going to be seeing some serious hard selling of the iPhone, not to mention Capitalism at its best!

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Another scoop I learned from Twitter is that supposedly Apple gave many conditions before agreeing to sell the iPhone in Israel. To just name a few, the iPhone ads need to be iPhone ads, no Cellcom ads or Orange ads, but ads made by Apple. This is good news for the average Israeli since most commercials here needs improvement to say the least! Another prerequisite was that the iPhone cannot exceed a certain price! From what I have heard, Apple put a cap on the price of the iPhone, another fact that will of course make a lot of Israelis happy. If you look at the markup of other phones, you will understand why. The bottom line is that the iPhone will be available on every street corner, will be advertised using every form of media, and will be offered at a minimal price.

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If all the above conditions are in fact true, Apple’s competition has a challenging few months ahead of them, which brings me to my next point. Nokia is launching the N97 in Israel over the next few weeks. Now, putting all the initial and generally negative reviews aside, the N97 is an impressive device. A 3.5″ touch screen, full QWERTY physical keyboard, a whopping 32GB of storage with the ability to add 16 more GBs with a Micro SD card, HSDPA, Wifi, GPS, and a 5 mp Auto Focus camera. What else can one ask for in a phone?

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The thing is, in this industry, it is all about timing, and Nokia Israel does NOT have timing on their side. With the iPhone launching, there will be many consumers that will refuse to pay such a premium price for the N97, when they know that the iPhone, which has a screen that actually responds (Sorry, I just could not help myself), almost all the features of the N97, and Apple’s revolutionary interface, will be available for significantly less, even if the camera is not 5 mp.

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Nokia has to be creative here if they want the N97 to become the next E71, which was extremely successful around here. I have to say that, putting my personal feelings aside (keep reading, you will understand), Nokia is on the right track. They just started a very smart and innovative campaign for the N97. Basically, they have a list of bloggers and they go from one to another with a package, while streaming it live on the Web. Each one opens the package with the hope that it will contain a brand new N97. If it does, the blogger gets to keep it, if not, he/she gets to decide who gets the package next. Of course, every blogger along the way blogs/tweets about this interesting contest and creates more hype surrounding the N97. Now, although I was not on the list (hence the personal feeling comment earlier), there is no denying that Nokia did a brilliant thing here. They targeted their ideal audience, the exact people who would even consider purchasing an N97, and they did it without writing one press release or launching one expensive TV campaign.

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So far we got two major players competing for the same people, Apple and Nokia. As if that was not enough to cause complete chaos in the cellular scene here, add another variable to that equation. Remember that company that once claimed they are the next big thing in the mobile world? They were designing modular devices? Sound familiar? Well Modu is launching! They are launching this week and they are doing it in…you guessed it, Israel.

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Now, I really do hope they succeed as a company, but I have to say, when I heard about it, what feels like a lifetime ago, I thought it was a cool idea with potential, but now, I have to admit, I do not see what need there is in the market for such a device. The basic principle is that the Modu is a tiny and basic mobile device, which can be inserted in different “jackets” that take on various forms and functions. So if you are at work and need a QWERTY, put the QWERTY jacket on. If you are going out with the guys and want a cool looking touch screen, simply put the touch screen jacket on (I am pretty sure they have not released the touch screen jackets yet). It is a cool idea but in today’s market, the people that want a QWERTY have a Blackberry, the people that want a touch screen have an iPhone. Not sure this idea will fly anymore. Even if it does have potential to take off, with buzz words like iPhone and N97 in the air, I am pretty sure now is NOT the ideal time for Modu to launch and Israel might not be the ideal place.

modu_modular_cellphone_1I don’t think there is any doubt who will prevail in this upcoming battle. Apple has successfully created so much hype surrounding its iPhone ecosystem, that when the iPhone finally does launch here, Israelis of all ages will be running to buy them. If the amount of Facebook groups appealing to Apple to bring their device to Israel or the amount of Israelis who already have iPhones they bought, jailbroke, and unlocked are any indication, the iPhone is on its way to a major success in Israel.

iphone-3g-s-200906081I am pretty sure the N97 will also see a relative success, after all if the providers reach their goal and sell 100 thousand iPhones, they still need to sell 50 thousand more devices, the N97 can comfortably fit into that category.

As for Modu, as much as I personally wish them success, I am very skeptical. As Dov Moran, the name behind Modu said, they had so many obstacles along the way, whether it be the developer of the Modu interface going bankrupt or the worldwide recession, someone apparently does not want them to succeed. In my opinion, their initial statements about how amazing their product is and how it will revolutionize the mobile world did them no good either.

However, given all the obstacles Modu met ¬†along the way, there is no doubt that a failed launch can be a very detrimental thing for a company and as much as all the above factors might have damaged Modu, the two words that will pose the most serious threat to Modu’s success are Apple and Nokia.

-Hillel

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6 Responses to “Nokia N97, iPhone, and Modu Go Head to Head”

  1. miry

    20. Jul, 2009

    yay! iPhones for israelis.
    Apple products simply perform better, last longer, and look sexier than any other brand or product on the market. I recently sold a 4 year old powerbook g4 for 3000NIS. Think about it: what other computer would sell for such a high price after being used for 4 years? Dell? IBM? Viao? Any of these computers would be completely useless and worth practically nothing after 4 years.
    I see the iPhones taking a similar wave- I just say a posting for a 2G iPhone for sale for about $300 with very competitive bidding.
    To put it simply, people want Apple products and EVERYONE, even non-Mackies would consider an iPhone a huge upgrade from whatever devise they currently use- BB, Palm, Nokia, you name it.

    Side note, Nokia posted a 66% decline in profits from last year.

  2. jon b

    20. Jul, 2009

    iPhone will trump the N97 unless Nokia can blow past not only bloggers, but the mainstream media. They need to bring high production value (ala Apple) to Israel in a locally compelling manner.

    Because head to head, the iPhone has a stronger cultural cache, and a MUCH stronger app store offering.

    Modu is still an incredible concept, but they need to become very tactical. However, the concept was developed in a different day and age, when phones were still clunky. Their proofs of concept are nice, but their real world execution needs to be smooth, complete with curves, a groundbreaking UI and a strong phone-envy. The experience, from the unboxing through the day to day user experience needs to scream “better”. The QWERTY add-on needs to be flawless, and their GPS add-on needs to have a large, possible foldable screen.

    iPhone has powerful momentum. And while blogger pass along is a strong driver of perception, Nokia needs to go further to overtake iPhone cultural cache. Modu needs to prove their value as a competitor. Looking forward to seeing this play out, it’s an exciting time to be in mobile in Israel!

  3. hilzfuld

    20. Jul, 2009

    John, thanks for reading and commenting. Could not agree more, although if Modu had everything you described, they would not be Modu, they would be Apple :) Anyway, keep reading.

  4. tnspr569

    20. Jul, 2009

    Sadly, I think you may be correct about Modu, Hillel. Their time has passed.

  5. hilzfuld

    20. Jul, 2009

    tnspr569, let’s hope they surprise us all…

  6. james

    25. Jul, 2009

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