Watch out, BlackBerry -- iPhone flaws cited in survey soon to be remedied

Fans of the iPhone and the BlackBerry both have their reasons for preferring the device of their choice, but coming changes to the iPhone could make it more tempting to a wider audience.

A report released today by Rockville, Md.-based ChangeWave Research on customers of the top two smart phones identifies what they like and don't like about Apple's iPhone and Research in Motion's BlackBerry. The report data was drawn from a previous ChangeWave survey on smart phones conducted in March.


The results echo commonly accepted notions about the strengths and weaknesses of the rival communication devices, but also illustrate how a few changes to the iPhone – several of which are expected in June -- could make it far more attractive to many more customers.

The single most important feature to BlackBerry customers is overwhelmingly "e-mail access," with 56 percent calling it the feature they like best. The second-most mentioned response, mentioned by just 7 percent of the respondents, was "size."


The original iPhone software could not integrate well, if at all, with corporate e-mail systems. But Apple has an answer in the pipeline -- the iPhone 2.0 software due out in June. In one stroke Apple will neutralize the BlackBerry's single biggest advantage.

Customers' dislikes about the BlackBerry were more varied. They disliked the Internet browser (13 percent) most, followed by the keypad (11 percent) and application problems (10 percent).

The iPhone enjoys an edge in Web browsing, with its customized version of Mac OS X's Safari. Instead of "application problems," iPhone users complained their device "doesn't support third party software" -- but again, Apple has targeted that issue with the impending release of the iPhone Software Development Kit.

The dissatisfaction with the BlackBerry's keypad surprised me a little, as numerous critics have claimed the iPhone's touch screen keyboard is harder to use. Yet 27 percent of iPhone users cited the touch screen interface as their favorite feature.

Not surprisingly, even more iPhone owners (36 percent) preferred its "integration of phone, iPod and Internet browser" functions in a single device. Those two features comprise the essence of the iPhone's appeal.

The iPhone dislikes chart similarly contains no major surprises. The top two items involve AT&T, Apple's designated cellular provider in the U.S. One in five iPhone owners (21 percent) said their biggest gripe is the slow speed of AT&T's EDGE network, and nearly as many (17 percent) objected to the requirement to use AT&T.

If recent conjectures on the June arrival of a 3G iPhone prove true, Apple soon will have an alternative for those dissatisfied with AT&T's network speed.

Citigroup analysts Richard Gardner and Yeechang Lee predicted in a research note last week that Apple CEO Steve Jobs will introduce the 3G iPhone in an as-yet-unannounced keynote address at the Worldwide Developers Conference (June 9-13).


A report yesterday on the DigiTimes Web site that Chinese-based FoxConn Electronics – which makes the current iPhone models – had landed orders for the next-generation model added more weight to the likelihood of the 3G iPhone. The first 3 million units supposedly are due to ship in June (fancy that!), with a total of 24 million to 25 million expected to ship through the model's life cycle.

A 3G capability was the feature most cited by iPhone users (19 percent) in the ChangeWave survey when asked which new feature they'd like to see. Third party software (18 percent) followed close behind along with GPS (15 percent).

Talk about giving the people what they want. A 3G iPhone married to the iPhone 2.0 software will satisfy several customer desires in one swoop.

Only two significant impediments to iPhone sales appeared in the ChangeWave survey: price and the AT&T requirement.

Of those surveyed that said they planned to buy an iPhone but had not yet done so, 24 percent said they were waiting for the price to drop. Almost as many (22 percent) said they were waiting for the iPhone to become available on other service providers.

I have said often on this blog that Apple should sell an unlocked version of the iPhone at a higher price, and someday it probably will. But not in June.


So when Apple makes its numerous iPhone announcements in a little over a month, the only murky piece of the puzzle will be the product's price -- a sticky issue ever since the startling $200 price drop last year just 10 weeks after its introduction.

American Technology Research analyst Shaw Wu said in a note to clients last week he foresees a reduction in the price of the "old" 2.5G iPhone models to $349 and $299 when the 3G versions arrives. (The current prices are $499 for the 16 GB model and $399 for the 8 GB model.)

Matching the ChangeWave data with what we know of Apple's plans, I see a strategy that squares extremely well with what current iPhone customers have asked for and what potential iPhone customers have been waiting for.

That goal of selling 10 million iPhones in 2008 looks more realistic every day, doesn't it?