As the first iPhone sales are about to happen on the East Coast, we thought we'd offer a few thoughts.

A Business thought
The iPhone is an (almost) free business expander for brick and mortar retailers. The iPhone turns every shop into an internet café. Sure you can haul out your laptop in a Panera Bread Café and enjoy their free WiFi while having a meal, but short visit eateries or businesses where shoppers walk around browsing can now offer that friendly open WiFi speed boost that will draw in visitors. All the business needs is a DSL connection, and many shops already have them, and a small WiFi router to draw in the customers.

A Technical thought
Since the iPhone switches from EDGE to WiFi when it finds an open service, the iPhone is a hand held WiFi detector.

A Product Support thought
Since Apple announced yesterday that the company is giving a free 8GB iPhone to every employee and long term part timers, the iPhone becomes the first product in history that will be used daily by every employee of the company that makes it. OK maybe Coke was first, but colas don't need bug fixes and ongoing product development. A brilliant move on Apple's part, considering the implications for better quality control and faster revision cycles.

A Feature driven thought
The iPhone is the first mobile phone that is not limited to the features built into the product in the box you buy today.

Criteria's business is knowing about genY and sharing that market intelligence with our clients. We are not in the business of prognosticating about Apple. Yet, as Macworld is only two hours away, it does seem timely to make a few observations, not really predictions, about what Apple may announce and whether analysis by strategic marketing wisdom will help businesses, consumers and competitors understand what they are about to do. Criteria's point is that genY possesses a New Buying Paradigm (NBP) that traditional marketing is blind to. Apple understands this NBP and their competitors don't. Neither do the analysts who pontificate on Apple, so all the guesses about Apple's future products that don't take into account this NBP will be incomplete or wrong.

Right now, the key to guessing what Apple will do next lies in looking at what they already do well. From this we can see the Apple Grand Strategy. That strategy is: eliminate efforts at tactical planning and recovery with an environment that lets the user make one strategic decision and avoid a lot of small worries. In its simplest form it is: Act Now - Benefit Later. The action for a consumer is usually: buy some Apple product today, then ignore a whole bunch of trivia later.

We can see this in the first iPod.
There were plenty of music players before the iPod but they required the user to plan ahead and pre-load the music he or she wanted to hear. The invisible appeal of the iPod was, "take it all with you" and choose your listening later.

The solid state iPods and the shuffle address a slightly different market. Both eliminate the need to constantly answer the question, "do I want to carry this?" by being so small and durable that no one needs to really think about taking it along.

Most recently this strategy appeared in the Time Machine feature in the upcoming Leopard version of Mac OS X. Developing a strategy for computer file backups has been a nightmare since programmers duped card decks and IT managers hauled around giant reels of mag tape. At the moment there are at least a dozen software packages to back up a Mac and all of them, even Mac's own Backup, requires the user to guess at which files to back up, when to schedule the backup, and what media to use. Time Machine's approach eliminates all these questions of advanced planning and tactical operation. Just nominate one hard drive as the target and then, at any time you can recover any file that ever was created on the machine. I'm surprised Apple didn't spin off the iPod appeal and sell this feature as, "The Past is Still With You." Just as the iPod strategy simplifies to "take all your music," Time Machine simplifies to " bring the past into the present."

Another example of this is the way iChat works for online messages, audio and video chat. Once someone is in your buddy list, you can see them (subject to a do not disturb flag) wherever they are. All message systems sort of work this way, but Apple's gift is to make a commonly available generic product or service just practical enough and glossy enough to sell their version.

Oh, yes, don't forget the Choose to Ignore appeal of all Macintosh computers: once you have a Mac, you can pretty much ignore viruses, trojan horses, spyware, and other operational problems that annoy windows users.

So...

The Wall Street Journal says Apple will introduce a phone that plays music like an iPod. Apple probably will introduce a phone but the appeal of the phone will not really be the ease of use improvements on what cell phones already do (although it will) or the slick design (it will be slick) but in some space that makes it easier for users to communicate with their friends. Notice, we did not say "dial them" or send them a "text message" lots of phones do that now.

Another source suggests Apple will introduce some kind of Mac nano that will remake computing. This sounds more like wishful-geek-thinking, than serious prediction, but any such product would have to fulfill some yearning of users, especially genY, who are the bellwether buyers of iPods, not just create a tactical, operational nightmare later. The invisible appeal of such a product would be: don't choose what stuff to put on your PDA, take your whole computer in your pocket. We will know the answer in about ten minutes.