Apple CFO Peter Oppenheimer says the iPhone can be a hit for business customers with "a very little bit of help from the corporate IT department."
That statement made on Apple's third quarter earnings call was notable on a few counts. First, Apple's iPhone is clearly positioned as a consumer device, but the company realizes it needs corporate customers. Second, Apple is looking for a little help from IT managers to get the corporate messaging ball rolling with the iPhone.
The big question is whether corporations will play along. They will if enough employees and CEOs bring the iPhone into the workplace. But Apple is likely to need more than the 1 million iPhones sold by the end of the September quarter. Apple reported stellar earnings on Wednesday largely fueled by Mac sales (see Techmeme roundup).
Before going over what needs to fall into place here's Oppenheimer's complete statement on the conference call:
In terms of the corporate market, we think the iPhone is a breakthrough product for all customers, including business customers. It’s a great Internet device that includes the best email client out there with the best web-browser ever on a mobile device. With a very little bit of help from the corporate IT department, it can be set up to work with corporate email. We already have a number of corporate customers that are piloting the iPhone in their enterprises and they have told us that they are very happy with the results so far.
It's currently unclear who is conducting iPhone pilots and how big these tests are, but the point is notable. Here's what needs to fall into place to make the iPhone a corporate reality--and a Blackberry killer.
- A little messaging would help--and we're not talking about email just yet. AT&T notes that the iPhone is a consumer device. The implicit message: companies need not apply.
- No corporate accounts. Everything related to the iPhone is personal--iTunes, data plan etc. That means employees would wind up expensing each employee if it supported the iPhone. That's a headache.
- The iPhone SIM card doesn't appear to be replaceable, which means it's difficult to swap an iPhone into an existing corporate account.
- No discounts and no pooled minutes. When you're talking corporate accounts and devices volume matters. If the iPhone sticks with its current price and every plan is individual it won't be cost effective for companies to bother. Let's say you are outfitting 200 employees with mobile devices. You get 200 Blackberries at an average of $200 ($40,000). The iPhone is at $499 ($99,800). That's real money. This pricing could change with an iPhone corporate phone, which may be in the works at some point.
- AT&T's EDGE network is pokey for swapping PowerPoints, Excel spreadsheets and other corporate mumbo jumbo. And the iPhone doesn't allow you to edit these corporate documents.
- And the real killer. Email, calendaring and contacts are an issue--unless you're using a software as a service app where the iPhone is a real enabler. The iPhone needs to support Good Mobile Messaging and Microsoft ActiveSync. There may be some deal with ActiveSync, but it's a bit fuzzy.
These are just some of the issues Apple says that IT departments should offer a little bit of help. The rub: IT departments are strapped and unless every C-level executive has an iPhone and is screaming I doubt Apple is going to get the help it's looking for.
In the end, the iPhone will get some corporate support--because the CEO has one. But Apple will have to meet IT departments half way on some things.
End note: If you're one of these companies piloting the iPhone and offering Apple a little bit of IT elbow grease I'd love to hear how the experiments are going.