If you think Apple's iPhone touch screen is just a neat cell phone interface you're missing the big picture--and possibly three to four years of new products.
That's the message from UBS analyst Benjamin Reitzes. According to Reitzes, the iPhone and its touch screen interface signal the beginning of a multi-year product cycle. The analyst argues that Apple is likely to see "a replay of the iPod multiplier effect." That term refers to what happened when Apple launched the iPod, offered new online services around it and sold more Macs along the way.
In other words, Reitzes sees the iPhone touch screen fueling years of new Apple products. Is there any reason that the iPhone touch screen won't make it to the iMac, iPod or any of Apple's products?
Here's what Reitzes says in a research note:
"We believe the multi-touch platform initially to be shown in the upcoming iPhone can be integrated into several products, including Macs and iPods, facilitated by Apple's software and retail ecosystem. We believe this 'mega-platform' could help Apple become an open-ended growth story again, with a logical chronology."
If Reitzes' theory is on target--and it sounds quite plausible--Apple will offer a neat counterpoint to Microsoft's approach. Microsoft's big focus is voice as an input to the multiple devices. That's why the software giant bought Tellme. Apple could be touting touch as the best way to work with your devices.
"We expect multi-touch to be prevalent in Apple’s major hardware products within three to five years—making its way into touchscreen Macs next year. We also foresee new touch screen video iPods, ultra-portables, more phones, and possibly even TVs," writes Reitzes.
The big question: Is touch or talk better? Ideally, I'd have both working well, but initially look for touch to gain traction a bit faster.
Even if you don't buy Reitzes touch argument, he makes a valid point on seeing the big picture when it comes to product announcements. Since the Jan. 9 iPhone launch most of the chatter has been about features of the device and its potential. Collectively, all observers should zoom out to see the big picture.
"We believe some in the investment community are too focused on the minute details of the initial iPhone that was announced (talking about the choice of Cingular initially, 2.5G technology, price points, etc.) and ignore the power that lies in the unannounced multi-touch “ecosystem” that can be integrated into several products across Apple’s portfolio, including Macs and iPods—all facilitated by vertically integrated software. We believe Apple is in a position with the multi-touch platform similar to its position in 2001-03, when it launched its first iPods with the popular click wheels. At that time, it was perhaps irrelevant to focus on the details of the initial iPods—things like capacity and the relatively high $399 price point."
Point taken. Remember this argument when touchscreen iMacs hit the market. There's most likely a bigger product plan and roadmap to be found.
Update 11:05 PDT:
One lingering question is how this touch screen idea would be implemented in practice. John, a reader, noted the following in an email:
Consider putting the touch screen into a keyboard. The biggest knocks I know against touch screens is the large arm motion, the software that may put a button anywhere, and having to wipe off fingerprints. Trackball with a touch screen towards the inside so that for a righthander you're looking at keyboard, touchscreen, trackball (or mouse) from left to right.
Interesting point. Thanks.