“This is the first year when last year’s specs remain good enough to serve as the mass market new iPhone.”

— John Gruber nails the key to the iPhone 5C: Smartphones have matured to the point that last year’s is still more than good enough. This is the phone I’d recommend to most people now, and should become Apple’s best-seller. This might also mean that Apple can do crazier things with the “pro” model without having to worry so much about supply.

iPhone 5 S.C., As In, Supply Constraints?

Today’s iPhone 5S/5C event went spookily close to the predictions. The phones look fine, and I think the colors will actually help. I’m excited about the future potential of fingerprint identity, payments, and whatever else it may someday enable.

The real question, though — since we are talking about Apple’s most important product, by far — is whether Apple will be able to keep up with demand. Now that new iPhone launches happen so close to the holidays, the two demand forces crash into each other, and Apple has struggled to keep up.

“We sold every iPhone we could make” is only a “good problem to have” to a certain point, and then it suggests that you should probably do a better job at making more iPhones. (Then again, Tim Cook is supposed to be the best in the world at this, so maybe the real limitation is reality. Still.)

I’m planning to sit out this year’s updates, so one of you can have my place in line. But this is definitely one of the things I’ll be keeping an eye on this year: Has Apple gotten better at making more iPhones, faster?

What If Microsoft Had Bought BlackBerry In 2009 Instead?

If Steve Ballmer had taken my advice four years ago, would he be better off today?

Steve Ballmer

The big tech story this week — until another iPhone part leaks, that is — will be Microsoft’s $7+ billion acquisition of Nokia’s smartphone business.

I actually like this deal. As Apple and Samsung have proven in recent years, one way to a profit in the smartphone industry is to sell expensive hardware at significant scale, which operators subsidize to reasonable retail prices. That’s not necessarily going to work forever, or even for long, or especially for everyone, but it can work today. For Microsoft, it’s worth trying.

Until now, Microsoft didn’t have anything like this at all — just a lousy mobile-OS licensing business, a patent strong-arm over the Android world, and some services revenue. But nothing that moves the needle.

Now, Microsoft has a credible business model for mobile — producing and selling high-end smartphones. (Not to mention its likely CEO-in-waiting, Stephen Elop.) As always, execution is everything, and Microsoft’s mobile history suggests it could easily screw this up. But there is at least an opportunity for bigger success that didn’t really exist last week.

This reminds me of a series of articles I wrote starting in 2009 urging Microsoft to buy BlackBerry, or Research in Motion, as it was then known. Why? For essentially the same reason: To give itself a real possibility at making money in mobile.

RIM, for instance, gets several hundred dollars in revenue for each BlackBerry sold, plus BlackBerry email/Web service fees. Microsoft, on the other hand, has stuck itself with a lousy business selling Windows Mobile operating system licenses for $8 to $15 per phone, according to research firm Strategy Analytics.

So while analysts expect RIM to top $14 billion in revenue next fiscal year, Microsoft will be lucky to reach $400 million in Windows Mobile revenue (30 million Windows Mobile licenses at an average $12 a pop). That’s couch change for Microsoft, whose revenues should top $60 billion this year.

Since 2009, of course, BlackBerry has imploded. Its longtime co-CEOs were forced out, its tablet bombed, and its market share and profitability have declined significantly. The future looks bad, too.

The main problem: It was never able to create a mobile platform that could compete with iOS, Android, or even Microsoft’s Windows Phone. For example, here are John Gruber’s brief thoughts on the recent BlackBerry Z10: “Pretty nice” hardware, “disaster” software.

This is exactly why a Microsoft-BlackBerry tie-up in 2009 could have been good! Just as Microsoft was starting to put together a really solid software platform in Windows Phone 7, BlackBerry needed a grownup OS. Plus the obvious overlap in enterprise, RIM’s worldwide distribution, and even a budding mobile social network in BBM. There’s a possibility that it could have been a good combination.

The price, especially relative to the Nokia deal, would have been high. As I wrote at the time, “With RIM’s market cap down to around $21 billion, Microsoft might be able to get the deal done for $35 billion.” Today, BlackBerry is worth $5 billion — most of its value has disappeared. But Apple has also generated more than $200 billion in iPhone revenue since then — and huge profits. This is an industry where you need to go big.

It is, of course, actually impossible to know whether a Microsoft-BlackBerry tie-up would have been better or worse than where we’ve landed. Given the characters and track records involved, it could have easily been a disaster. But this is also the most important transformation in the history of computing, and the biggest software company in the world has missed the boat so far. Buying BlackBerry four years ago and executing well could have been better.

Now for the charts. We all know about Google’s amazing Android rise over the past few years, but do you remember back to 2006 when Microsoft led the U.S. smartphone scene? (Stats by comScore.)

The market wasn’t nearly as big back then — see the second chart of actual subscriber numbers, showing what happens when you top out early — and it was soon dominated by BlackBerry, which also didn’t last. And it’s worth noting that whatever lead Microsoft had wasn’t because people were in love with Windows Mobile — it was just the least-bad option for companies like HTC, Motorola, Samsung, and even Palm. The story here isn’t that Microsoft didn’t see the mobile revolution coming. It just peaked way too early, and wasn’t prepared when Apple showed up with something a lot better.

The Nokia deal doesn’t solve this problem quickly, but again, it at least puts Microsoft into a position where bigger and better things could happen.

Smartphone Market 2006 2013

“For thousands of qualifying books, your past, present, and future print-edition purchases will soon allow you to buy the Kindle edition for $2.99, $1.99, $0.99, or free.”

— Amazon’s Kindle MatchBook program — coming in October — sounds like the “AutoRip for Books” I’d hoped for. Let’s hope the book publishers don’t screw up a good thing.

UK Carrier Drops International Roaming Fees: A Trend I Can Get Behind

Three, the U.K.-based mobile operator owned by Hutchison Whampoa, just launched a new feature called “Feel at Home” in seven countries where it also has local networks: Australia, Italy, Denmark, Austria, Sweden, Hong Kong, and Ireland. In short, it lets you use your mobile plan — calls, data, messaging, etc. — the way you would at home, whether you’re on a contract or a prepaid plan.

This, of course, sounds awesome, and I’d love to see more of this. International roaming — especially data roaming, especially when it’s $20 per MB — is one of the most absurd rip-offs in mobile. While rates for AT&T and Verizon subscribers have improved over the years, they’re still much higher than they should be, and other carriers like T-Mobile still only have rip-off rates.

This was one of the great hopes I had for Verizon Wireless when it was still part-owned by Vodafone: A large, international network of roaming services at rates that made you excited to use your phone abroad. (I’m also surprised that T-Mobile, owned by Deutsche Telekom, hasn’t jumped on this concept.) Even if there is a slight surcharge — sure, there are some costs involved in roaming — that would be a great pitch to many frequent travelers. But now that Verizon is buying Vodafone’s stake, who knows.

In the meantime, I’ll keep taking advantage of my unlocked Verizon iPhone 5, and will keep filing global data roaming reports.

“Suddenly, everyone’s discovered the wrist … We’ve known for a long time it’s prime real estate. We’re prepared.”

— Casio CEO Kazuo Kashio talks to the New York Times’ Hiroko Tabuchi about the rise of the smartwatch. Watches represent 85% of Casio’s operating profit. (Reminds me of Ed Colligan’s infamous quote about “PC guys” and smartphones.)

Now You Can Book Me On Emissary

Quick update: I still entertain occasional, interesting consulting gigs, ranging from digital and editorial strategy sessions to product feedback to assembling lists of must-poach candidates for great jobs.

I’m also testing a new tool for paid video chats called Emissary. Want to talk about something for less than an hour? (App store economics? Apple’s future? How to grow your website’s traffic?) Here’s your chance without any complicated contracts to slow either of us down.

Need more than an hour? Say howdy.

The Apple TV App Store Can’t Be Too Far Away

Apple TV owners just got a bunch more channels: Vevo, the Weather Channel, more from Disney, and Smithsonian. This follows a recent update that added HBO Go and ESPN apps, and represents a continued acceleration of new content being added to Apple TV.

My guess is that the individual companies — not Apple — are making these apps. As The Verge’s Greg Sandoval reported in June, HBO’s app was made completely in-house — “100 percent created by our software and design staff.”

  • This suggests some sort of Apple TV SDK is in functional shape for outsiders to use, and could eventually be distributed publicly the way it is for iOS and OS X.
  • Then there’s the App Store component that needs to be figured out — sooner than later, I hope, as the Apple TV home screen is now starting to get cluttered, and I’d like more control over what’s there.
  • There is the problem, now, that Apple TV’s UI looks nothing like iOS 7. Perhaps that will be figured out first?
  • And what about navigation control? So far, these have been simple video apps. Assuming there’s a future in Apple TV gaming and other more sophisticated apps, there’s more work left, both hardware and software.

Still, it seems we’re getting closer to a real Apple TV App Store. I’ve been on this case since 2010, and it turns out that my enthusiasm was premature. But things seem to be moving in the right direction.