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Last Updated: Friday, 16 March 2007, 09:07 GMT
Muscling in on the mobile market
By Mark Ward
Technology correspondent, BBC News website, Hanover

Sony makes the W950 music playing phone

Most people would agree that the iPod rejuvenated the digital music market and, by the by, restored the fortunes of Apple.

With the launch of the iPhone, Apple is looking to do the same again - set the trends, corner the market and leave everyone else looking like also-rans.

But selling phones to people is very different to selling them a portable music player.

To begin with, most people already have a mobile phone. In the UK, upwards of 80% of households have one. Worldwide, more than one billion handsets were shipped in 2006. By comparison Apple, which has a more than a 70% share of the mobile music player market, sold 39 million iPods in 2006.

And with the iPhone, Apple will not be creating a market, it will be muscling in on a lot of very established companies.

Direct competition

A quick look at the technologies Apple is pushing in the iPhone shows that many others devices, either on shop shelves or about to be launched, share these features.

Take the touchscreen, for instance. Many smartphones - which more resemble a PDA than a plain handset - can be used with a stylus or a deft finger.

Nokia's 6708 and SonyEricsson's M600 and P990 are examples of this. All are made for corporate road warriors and, it has to be said, they look like it.

SonyEricsson also makes the W950 music-playing phone that has a touchscreen plus buttons, stylus and handwriting recognition. It also looks a lot funkier than the business versions.

iPhone (AP)
The iPhone is not the only mobile with a touchscreen

Gilles Oriol, product marketing manager for Western Europe at SonyEricsson, declined the opportunity to talk directly about Apple's iPhone. "We do not comment on rival products," he said.

But, he told the BBC News website, that he "doubted" that SonyEricsson would ever make a phone that only had a touchscreen.

"It must remain a good telephone first," he said, "consumers are more willing to dial a number with the keyboard than they are to do it with a touchscreen."

"Also," he added, "the point about a touchscreen is that it affects battery time. You need a powerful battery because to use the touchscreen means it remains on all the time."

Apple's iPhone is due to make its appearance in the US in June, but before the big day Asian rivals will have launched handsets that will be in much more direct competition.

In February, Samsung showed off the F700 that resembles the iPhone in many ways. The screen of the F700 is smaller at 2.78in (7.06cm) compared with 3.5in (8.9cm) for the iPhone - but in almost every other respect they are very similar.

The two have comparable amounts of memory and features, but the F700 has the advantage of including a slide-out keyboard and a five megapixel camera. By comparison, the iPhone Steve Jobs showed off in January only has a two megapixel camera.

Looks matter

But the greatest competition for the iPhone in terms of looks might come from the phone that LG has designed with Italian fashion house Prada.

Not only does this have a touchscreen, but it also shares some of the sleek looks of the Apple gadget.

LG Prada phone
LG's Prada phone

John Bernard, marketing manager for LG UK and Ireland, said the Prada phone was being designed long before Apple made its announcement.

He said that Prada had been looking for a partner to help it make and market handsets for several years.

Prada oversaw the design process for the phone, he said, and had the final say on what it looked like and the way that people navigated through its many menus.

"It looks gorgeous and that's what people are going to be buying it for," he said.

So far LG has no plans to sell the phone in the US, believing the customers in Europe and Asia are a better fit for its charms. It will be aimed at those who are aged between 20 and 45, said Mr Bernard.

He admitted that the slimline look of the phone had meant some compromises on features such as onboard memory.

But, he said, for many consumers good looks outweighed features. "The Motorola Razr is not a very well-specced device but it's one of the most popular ever."

The fact that people will buy for looks rather than features suggests, said Mr Bernard, that the mobile market is changing. No longer do people buy phones for what they can do but for what they say about them as a person.

A fact that has worked well for Apple when it comes to selling iPods - but the competition in the mobile world suggests that may be a tough act to follow.

Mobile makers show off new devices at Cebit

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