Every Company Needs a Good Map

Apart from the fact that you have some facts wrong, which lends false credence to your argument (Apple has sold over 100 million iPods see: http://www.apple.com/pr/library/2007/04/09ipod.html, and more than 10 million in the last quarter alone -- see: http://www.apple.com/pr/library/2007/04/25results.html), I think you've largely missed the point about why there is excitement about the iPhone and what it means.

First of all, the iPhone is categorically not a phone. So, of course it isn't the end-all be-all of all phones -- it wasn't designed to be. Is my notebook a phone because I can use it to make phone calls? Most people would say no. The same applies to the iPhone, despite it's naming.

However, it does represent a transformational change in computing (it isn't obvious yet, but it will be in 6 months), and defines an entirely new category of device, with an exciting new man-machine interface and outstanding functional integration. It is a leap forward, and a thing of beauty, and that's why it inspires such excitement.

No one perceives the iPhone to be the market leader in cell phones, unless they don't understand what that means. And, it's a silly category to put it in. On the other hand, you almost get it right with the statement:

If you want to be the king of your market just learn to define the market in such a way that no one questions it.

In fact, the iPhone is the leader in its niche because it is a new segment that the iPhone defines. Since they've defined the market, received unparalleled hype for the launch, and set the bar high with design and r+d, it is entirely likely that Apple will be king for a long time.

I almost agree with your conclusion, although we arrive at it for different reasons, but it too is too simplistic.

If you want your product to have the attention and notoriety of the iPhone, then you need to be Steve Jobs. End of story. (Or, you need to find a drug that cures cancer and AIDS in one fell swoop.)

So in as much as the iPhone benefits from Steve Jobs personal branding and reputation for cool design and quality breakthrough products, then yes, time, brand building and design are required.

But the kind of hype that Steve generates is almost impossible to replicate, and if you doubt it, ask yourself whether Apple alone could have done this without Steve's reputation and personal charisma? It's like that famous Masters Tournament final day chip shot on the 16th by Tiger Woods a couple of years ago. On any given day, lots of golfers make those kind of shots. But we expect them from Tiger, and we expect him to do it under the magnifying glass of everyone watching and expecting him to win every time he steps on the course. So, we remember his remarkable shots, and the excitement about them defines his career. As does Steve's reputation for remarkable accomplishment in technology and marketing.

I'd like to challenge one other red herring in your analysis. Again, apart from the fact that your numbers are very wrong, there is no meaningful market share category for all things that can play MP3s, (or if there is, your figures conveniently don't include all the PCs and standalone CD players that can also now play MP3s), any more than one would try to create a share number for "all things that can hold water that I can drink out of" which would include pots and pans, plates with enough curvature to hold water, empty bottles, etc. as well as cups. But clearly, all those other things aren't cups, and measuring sales of pots and pans versus cups is nonsense. The same holds for all possible devices that can play MP3s, and comparing that to iPod's share.

It's hard to believe how far we have to stretch to try to reduce the scale of the iPod's market dominating success.

For more detailed analysis of what Steve is up to with the iPhone, see: http://thewaythingsare.typepad.com/antimarketer/2007/06/what-is-steve-j.html

Wow Paul, you certainly have invested a lot of thought and emotion in this topic. Your response here is trivial compared to your very comprehensive post on your own blog.

I appreciate your comments, slaps and all. I think you have me wrong on some aspects but that's fine. You seem to have missed my point and I am in no way trying to take away the iPods success, but I think it has been overblown on behalf of those who own iPods. I do think Apple without the return of Jobs would not be what it is today. People used to speak of Walt Disney in a similar fashion, he could hardly make a movie that failed, but some did.
Back to the missed point however. I was not trying to rip Steve or the iPod. What I was trying to show is that a market can be what you define it as, if you work at becoming the voice people want to hear. Don't you think Gates did that in the 80's or 90's? For a few years didn't everyone look to Netscape, then Amazon, and then Google to tell us what the Internet was? I seem to recall the Paradigm shift in business that didn't really happen. The total dominance of the minidisk that never happened. Perhaps we can talk about the Newton?

I disagree that the iPhone will be a "Transformational Change" - as defined by Richard Foster and Sarah Kaplan, in their book, "Creative Destruction" - A transformational change renders prior ability or knowledge virtually obsolete. the iPhone may be a substantial change but it is not transformational. It still remains to see if it will be the Mac or the Newton all over again. I can see reasons for both.

Which market is what is not really my point. My point was that if you define the market you can make your case with greater ease. Becoming that person who defines the market is the real challenge not what you sell.

Are you looking to help Apple by already working to not define the iPhone as a phone - change the rules and change the game? So now Apple can have 100% of a market that it did not even define.

Again, thanks for your view. I wish I had more people who put as much into their comments but I am glad I don't. I would never get any work done. If I am wrong on the numbers, and I did concede that I might be, I still think the argument holds - a market is what you can convince others it is. BTW - the pots and pans is a good counter argument. I was thinking for the MP3 market only of handheld portable devices that can play MP3s - PDAs, Cell Phones, otehr gizmos but not laptops, or boomboxes. If we add the capability to play video it changes everything but that is the point isn't it?
In the end what matters is: Perception is reality.