The iPhone 3G Is at Wal-Mart, but Where Is the Smartphone Industry?


Wal-Mart began yesterday to sell the iPhone 3G at almost 2,500 stores. The news was expected, but it's a milestone nonetheless. The 8 GB version of the phone will cost $197 and the 16 GB $100 more. Those prices are dependent upon a new two-year contract with AT&T or a qualified upgrade.


This CNET commentator clearly thinks the move is significant. In fact, he essentially says that it is game, set and match in the consumer smartphone sector. The combination of Wal-mart and Apple, says Don Reisenger, "has changed the face of the cell phone industry." He adds:

[W]hen you consider Wal-Mart's size and importance, along with its decision to ignore devices from every Apple competitor, I think it's abundantly clear that the opportunities for success for RIM, Google, and the rest are severely diminished.

There is an even bigger picture question here, however: How will the financial meltdown affect the evolution of smartphones, which are at a sensitive point in their evolution? They clearly have caught the public's fancy, but there still is a long way to go.


The good news is that the sector apparently will enter 2009 with positive momentum. In addition to the Apple/Wal-Mart news, Gearlog cites comments from High Tech Computing CEO Peter Chou that more than 1 million T-Mobile G1 smartphones have been sold in 2008. The comments originally appeared in the Economic Daily News, a Chinese publication. Gearlog adds that several reports said that in October there were 1.5 million pre-orders for the device. The writer points out that it is difficulty to translate orders into real users. It is clear, however, that the T-Mobile G1 had a good rookie season.


FierceDeveloper carries several bits of Android news that it says are from Google, though the source probably was the Open Handset Alliance. In any case, the piece says the Android Dev Phone 1, a version of the G1 that comes with an unlocked hardware and subscriber management information (SIM) functionality, had been released. The site also says that release 2 of the Android 1.0 software development kit is available. It fixes what the story says are "relatively minor" bugs in the earlier SDK.


More news will be made by Android during 2009. Samsung will introduce a phone with similar features to its Instinct and Behold, Motorola is said to be working on a device with strong integration with social networking sites and Sony Ericsson, which recently joined the Open Handset Alliance, may be heard from as well.


There seems to be a bit of cognitive dissonance in the cellular field. The world is facing an economic emergency and people are losing their jobs by the thousands. However, smartphones continue to be healthy, at least compared to other sectors of the economy. It will be interesting to see if this continues during the first weeks of what undoubtedly will be a difficult new year.