Apple Jars Consumer Electronics World

With his usual flair for publicity, Steve Jobs this week upstaged the world's largest electronics trade fair with new products aimed squarely at the heart of the consumer market—and he wasn't even there. On Tuesday in San Francisco, Jobs unveiled: a new music player with touch-screen controls; a slick, slim camera-phone; and a stylish hand-held computer; all in one form factor. The multi-purpose iPhone, which had been rumored (and denied) for over a year, immediately sent a seismic shockwave through the industry.

While Las Vegas was teeming with enthusiasts, vendors, and media attending the giant Consumer Electronics Show, Jobs was trumping the competition at MacWorld, the company's own show held each year to promote all things Apple, which he pointed out was now so focused on the consumer space that he's ordered the company to drop the word 'Computer' from its corporate name.

As has become his custom in recent years (see our blog from last year on this), Jobs rightly knew that he could focus more of the spotlight on Apple Inc. by acting the artistic-loner type who shuns the mainstream and thus stands out all the more. It's a bit of dramatic posturing that the iconoclast Jobs has been using effectively ever since he commissioned the legendary "Big Brother" ad of 1984. Still, the success of that one TV commercial, which aired nationally only once, was predicated on having something incredibly cool to market: the new Macintosh computer. Word of mouth did the rest.

Twenty-two years later, Jobs has almost dropped the advertising part altogether and these days relies just on the word of mouth from free publicity for his firm's latest innovations. This time, the big announcement is for a device that looks like it will not only generate a hype frenzy but might just be the gadget that a subset of the consumer market will actually embrace as the "next cool thing." Based on the "last cool thing," the iPod, Apple's new iPhone promises to be an electronics phenomenon, integrating a music player, personal digital assistant, Web browser, and camera-phone into a next-generation hand-held connection to a user's business and entertainment files, wherever they may be.

The next cool thing, though, will not be the next cool cheap thing. Starting in June, the US $500 (4-gigabyte) and $600 (8-gigabyte) units will launch into the crowded world of hand-held devices for computer and communications services. Reviewers and adopters will take hours and hours to offer up early judgments on the likely technical success or failure of the implementations. However, it took the financial world literally no time to pronounce the iPhone a looming success story, as shares of Apple stock rose precipitously even as Jobs bestrode his conference stage. Meanwhile, the shares of newfound competitors such as Palm Inc. and Research in Motion fell in counterpoint.

"Every once in a while a revolutionary product comes along that changes everything," Jobs declared in his trademark showman's style at Macworld. "Well, today, we're introducing three revolutionary products of this class. The first one is a widescreen iPod with touch controls. The second is a revolutionary mobile phone. The third is a breakthrough Internet communications device. These are not three separate devices. This is one device. And we are calling it iPhone. Today, Apple is going to reinvent the phone."

Leave it to Jobs to keep an air of mystery about the new product until the last possible minute. Somehow, he convinced those who knew of its development to embargo their words—for maximum effect—for over two years (which has got be some sort of record in the consumer electronics sector). And he got to be the one to make its long-stayed introduction "a really big show," as Ed Sullivan would have said.

Another old quote from popular culture probably sums up what Jobs must think of the work Apple's engineers, designers, and partners have done to make such an impact in one day: "It ain't brag if you can back it up." Consumers will eventually decide just how much brag they want to buy, of course. But if recent history is any guide, the first words from the iconoclast of digital media on the iPhone could very well back up what people will be buying soon.

It's still astounding to see just how much cool can be worth.

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