Analyst: iPhone Faces Several Business Challenges

By Sharon Linsenbach  |  Print this article Print


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While consumers are crazy for Apple's iPhone and business-users are increasingly adopting the device for professional use, a new report shows that several technical and business model barriers will impede the iPhone's growth compared to RIM's Blackberry.

The iPhone is making slow inroads into the enterprise, which has traditionally been the stronghold of Research in Motion’s BlackBerry, but some of the barriers to adoption may be beyond Apple’s control.

In a recent study that sampled its general user base, wireless bill auditing firm Validas found that of a sample size of 625 devices, iPhones and BlackBerrys each represents 3 percent of customers devices.

In another study sampling 9,628 phone lines, Validas found that, among users represented, BlackBerrys outnumbered iPhones by nearly 2 to 1. That same analysis showed that 'regular’ cell phones still dominated the business-user market, with 9,027 represented in the study.

With the third-generation release iPhone, a lower price point and July’s launch of business-friendly software, it would seem Apple has a strong position to take on the BlackBerry.

In the iPhone’s favor, Gartner recently praised the iPhone’s improved suite of business applications and plans to integrate support for Microsoft’s Exchange e-mail server.

But according to a Validas spokesperson, they’re not seeing more overwhelming penetration from Apple because of the device’s high price and the exclusive nature of their contract with AT&T.

"The major barrier of adoption for Apple is having an exclusive deal with AT&T–only having their device operate on that one network means there are about 160 million customers in the U.S. that they can’t reach," a Validas spokesperson says.

While the availability of the iPhone is ostensibly an issue Apple could remedy, another major adoption barrier isn’t one Apple can control–the economy.

In tough economic times, an iPhone might seem too pricey to appeal to budget-conscious businesses, especially if users were performing adequately without them, according Validas. The same could be said of any expensive mobile device, and it remains to be seen whether sales of RIM’s answer to the iPhone, the Blackberry Storm, which will make its debut this week on Verizon Wireless, will also be impacted by the looming recession.

Whether or not the iPhone becomes the overwhelming smartphone of choice for business users, it has already had an effect on the design and functionality of the handset market in general. Look around in any public place and you’ll see an increasing number of Internet-capable, touchscreen-oriented handhelds–and that’s no small impact on the enterprise.

Sharon Linsenbach Sharon Linsenbach is a staff writer for eWEEK and eWEEK Channel Insider. Prior to joining Ziff Davis, Sharon was Assistant Managing Editor for CRN, a weekly magazine for PC and technology resellers. Before joining CRN, Sharon was an Acquisitions Editor for The Coriolis Group and later, Editorial Director with Paraglyph Press, both in Scottsdale, AZ. She holds a BA in English from Drew University and lives in the Philadelphia suburbs with her significant other and two neurotic cats. When she's not reading or writing about technology, Sharon enjoys yoga, knitting, traveling and live music. Sharon can be reached at Sharon.Linsenbach@ziffdavisenterprise.com.