AT&T: With partners like this...
About this time last year, most every conversation I had with someone started to sound like this once they found out where I worked for a living and what I did there.
Them: So you write about Apple products?
Me: That’s right.
Them: That’s cool… so what do you think about this iPhone that’s coming out? How’s that going to do?
And that would be the point in the conversation where I’d stroke my chin wisely and furrow my brow and say in even, measured tones that the iPhone looked like a fine product, but I wasn’t sure how it would measure up to the successes Apple enjoyed with the iMac or the iPod.
So yes—I’m the guy who predicted that the iPhone might not take off. You may now point in my direction and giggle derisively. Or better still, invite me to your next party or social gathering and have me make spectacularly wrong forecasts for the amusement of your guests.
I bring this up not because I feed on humiliation, but rather because one of the reasons I gave for my admittedly off-the-mark prediction struck me as somewhat relevant in light of recent events. When asked why I was dubious about the iPhone’s prospects for success, I would explain that Apple had enjoyed its greatest triumphs when it had total control over a product. Unlike the iMac, the iPod, or any one of a number of other Apple offerings that the company designed, built, sold, and supported all by its lonesome, the iPhone required a partner—in the case of the U.S. market, AT&T. And while the two companies probably hammered out the whos, whats, wheres, and hows of iPhone marketing, they still differ in how they deliver on those goals.
Or to put it another way, while Apple has a very specific idea of presenting a unified experience and message to its customers, AT&T may not have that same notion. And that can lead to a confusing experience to the end user.
I think we saw this in recent weeks with a pair of bungled AT&T announcements regarding wireless connectivity and iPhone availability. AT&T’s messages to current iPhone users and potential customers were contradictory and confusing. Users were left scratching their heads while executives Apple, presumably, were left shaking theirs.
Let’s tackle the wireless connectivity issue first. Coffee retailer Starbucks is in the process of switching the Wi-Fi offered at its stores to an AT&T-provided service. The Starbucks-AT&T deal was thought to offer some benefit to iPhone users—specifically, in the form of free wireless access at Starbucks’ stores. Indeed, my colleague Dan Moren was among the many iPhone users to successfully log on to the network at his local Starbucks. Testing out the connectivity at the start of this month, Dan went to a Somerville, Mass., Starbucks, fired up Safari on his iPhone, and was greeted with a login screen that let him online after he entered his 10-digit phone number.
The free access lasted all of a weekend, as iPhone users started to report that they were now unable to connect with the AT&T network at Starbucks—at least, not without a user ID and password. That was certainly Dan’s experience when he followed up on wireless connectivity a few days after his initial success at connecting.
Ah, but the situation gets murkier. That same week, AT&T updated the information on its iPhone Web page to state that access to AT&T Wi-Fi hotspots (such as the ones now appearing at Starbucks) were included in iPhone calling plans; a few hours later, AT&T updated the page to remove references to the hotspot access. (Our sister publication Computerworld also covered the appearance and disappearance of the promised feature.)
Our attempts to get any sort of clarification from AT&T have been met by a stream of “no comments,” but The New York Times managed to talk to an AT&T rep who attributed the Web page switcheroo to “human error.” In that same interview, the rep also says that AT&T plans to let iPhone users access its wireless hotspots, though he wouldn’t say when and to what extent.
So, if you’re scoring along at home, first AT&T allowed iPhone users to hop on the Wi-Fi hotspot at Starbucks locations until it didn’t, then it promised you could though that was a mistake, and now it’s saying that one day you should be able to, though it doesn’t know when. Seems clear enough to me.
Compared to that morass of contradictions, AT&T’s stance on iPhone availability is positively crystalline. As Macworld reported last week, iPhones are in short supply, though some AT&T stores report still having 8GB and 16GB models. We also confirmed reports that AT&T had placed a one-iPhone-per-customer limit on purchases at its stores.
And that was true… until AT&T rescinded its limit after one day. The company confirmed to InformationWeek that it was going back to its old policy of three iPhones per customer after realizing that “we have sufficient inventory to go back to our original policy.” And that continues to be AT&T’s policy, at least as of the moment I’m typing this sentence. Five minutes from now, who knows what the limit will be?
These flip-flops are annoying, certainly, but are they having an appreciable effect on Apple’s iPhone business? It would be hard to make that argument, considering Apple has sold more than 5.7 million phones in a little less than a year and that it should meet its goal of selling 10 million—especially if the rumored 3G iPhone becomes a reality fairly soon.
But I can’t imagine that Apple, which places such a premium on delivering a clear, consistent message to its customers, can be terribly pleased by this “Yes! No! Maybe! Ask again later!” approach to public relations. And it’s a bad time to have a displeased Apple, as the company moves away from its previous approach of having an exclusive service provider in each country. After inking non-exclusive deals with Vodafone and Telecom Italia to provide iPhone service in Italy, Apple also went the non-exclusive route in Australia and India. If Apple has concluded that it doesn’t need single partners in other countries, it might reach the same conclusion about the U.S.
For now, though, Apple and AT&T seem certain to be partners for the length of whatever contract brought them together in the first place—five years, reportedly. After that, who knows? Surely, Apple realizes that a partnership is only as strong as its weakest link. And after the past couple weeks, one half of the Apple-AT&T relationship is looking fairly weak indeed.