10 years of the iPhone

Telecoms.com periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece Biju Nair, HLYA Mobile’s CEO, give his thoughts on a decade with the iPhone.

It’s hard to believe that Apple launched its first iPhone 10 years ago – and it was a device that came along and completely changed the game for both the mobile and the technology industry as a whole. Before its introduction to the market, no one truly envisaged the real impact the device could have on our daily lives. Essentially, in a world of feature phones, where a flip screen, music, or if you were lucky, a camera, were the height of sophistication, this mini-computer in your pocket was the thing of science fiction movies.

Fast forward to 2017 and iPhones are enabling users to do much more than anyone could have ever imagined. They are integral to almost every aspect of our daily lives, from managing bank accounts, controlling home security systems, paying for groceries, Snapchatting, Tweeting, to boarding aeroplanes. iPhones have also successfully replaced the indispensable camera for most vacationers.

Where it all began

Ultimately, the iPhone kick-started the mobile internet revolution. While feature phones of the 2000s had internet capabilities, they were slow, and were nothing like the internet experience on a PC. It was a similar case with music on phones – while storage was an issue, the quality of sound was also nowhere near those of personal music players.

Apple had revolutionised the technology market with its Macs and iPods, and it then went on to do it again with the humble iPhone. It brought the iPod, the Mac and the feature phone together into one easy-to-use device. Having done away with the keypad and replaced it with a large touchscreen and computer capabilities, Apple had reinvented the mobile phone, setting a new standard for the modern device.

But while the iPhone had been warmly received, it was without 3G and GPS.  When these were installed on the iPhone 3G a year later, the potential of the device was truly recognised. And even more so when the App Store was launched.

The reason that the iPhone was such a significant innovation of its time, and why the App Store was a trigger for realising the device’s true potential, was because Apple had thought well beyond the device. Really, Apple had contemplated an entire ecosystem. By developing apps, Apple made software available for consumers to do all of things they wanted to do, simply and conveniently. And by creating an App Store and a developer ecosystem, it could all be commercialized too. In fact, Apple changed the game so much that the phrase “there’s an app for that”, became (and still is) a standard part of our vernacular.

The ever-important upgrades

Over the next nine years, there was a multitude of updates to the iPhone. Not only did we see upgrades to the look of the device with the iPhone 4 and 5, there were significant improvements to the camera function, the introduction of the lightning connector, and not forgetting Siri. The evolution of the iPhone didn’t stop there either and in 2014, we saw the launch of the iPhone 6. This wasn’t just the introduction of one device, Apple brought two devices to the market, with the iPhone 6 Plus a device that followed the market trend for bigger devices.

And let’s not to forget the other iPhones that popped up along the way. The iPhone 5C and the SE gave consumers the option of an iPhone at a smaller price tag. We’ve also seen the launch of the iPhone 6S, 7 and 7S (albeit new devices with not too drastic updates) – with rumours of the iPhone 8 launching this year.

The biggest impact – the used device market

The iPhone has not only had an impact on the way we interact and engage with almost everything,  it has brought new business opportunities. Firstly, by revolutionising the mobile phone market, competition from the likes of new players like Samsung and Huawei over the last decade means the mobile phone market has grown exponentially.

But it has also led to the creation of a new market – the used device market. Before the world of iPhones and smartphones, feature phones didn’t have much of a second life. In most cases, they were handed down to a relative until they stopped working. But the introduction of the iPhone has had a knock-on effect, creating a huge used device market.

In fact, according to research from IDC, the global market for used smartphones will grow to over 222 million units in 2020, and the market is set to be worth $30 billion. This market is not only being led by device manufacturers, but by operators and retailers who are now offering device recycling or trade-in services.

Featurephones vs iPhones vs smartphones

With more and more companies offering trade-in services, the state of play for used devices has changed dramatically.

A few years after the launch of the iPhone, it was clear that smartphones and iPhones were having a huge impact on the trade-in market. In 2012, there was an almost even split between the number of featurephones (31%), iPhones (31%) and smartphones (38%) that were traded in.

But as the iPhone has taken a stronger hold on the market, the share of trade-ins for iPhones has grown. And today, while only 2% of phones that are traded-in are feature phones, 64% are iPhones.

But what exactly are these devices being used for?

Demand in alternative markets

The first route a used iPhone may take is to a developing country. In some developing and low-income countries, having access to a mobile device is just as important as access to gas or electricity. In markets where fixed broadband access is not freely available, having an iPhone provides that crucial internet connection.

Many parts of Asia and Africa are good examples of a market with huge appetites for used iPhones. The iPhone holds great status for consumers in these regions – but with the high price tag, these devices are often unaffordable. A used device can however, provide the same status, but at a much lower price.

But the life of a used device isn’t just about internet access or status – these devices are also used in developing countries to help improve quality of life. HYLA Mobile and its work with Facebook and Medic Mobile is a prime example of this. By refurbishing smartphones, HYLA Mobile, Facebook and Medic Mobile have been able to bring devices to 120 community health workers in Kenya which in turn provides critical healthcare to hundreds of thousands of people This allows health workers to register pregnant women, receive automated antenatal care visit reminders, report danger signs, as well as track deliveries, register newborn children and receive immunization reminders to ensure children are receiving necessary and life changing vaccinations.

Insurance and warranty

Another lucrative market for used devices is within insurance. With consumers increasingly unable to live without their iPhones and smartphones, more investment is being made in insurance plans. Users want to make sure that if their phone breaks, their screen cracks or their iPhone is dropped in water, they can get another device back as soon as possible.

With an increase in devices, and inevitably more accidents, it is economically not feasible for companies to pay out for a $500 device each and every time. A high-end refurbished phone on the other hand, provides a much more affordable solution.

The next step for Apple

There is no doubt that the iPhone has impacted our lives – and all for the better. Along with iPhones, iPads, the Apple Watch and the Apple eco-system of services all play an even more critical role in the lives of consumers. Bringing connectivity to the masses, it is a device that many of us believe we couldn’t live without. It’s also having profound effects on markets around the world, where more people are able to enjoy the devices more affordably.

However, in the world of smartphones – iPhones included – it seems that innovation has flatlined. While there is plenty of speculation as to what to expect from the latest iPhone – from virtual reality to better cameras and an all glass body – what consumers really want is the big issue of battery life to be addressed in upcoming devices.

So, with the iPhone 8 on the horizon, here’s to another 10 years of the iPhone, and the innovations Apple will bring to market.

As President and CEO, Biju Nair is responsible for the execution and strategy of HYLA’s global business. He leads the company’s expanding effort to grow the company’s global strategic vision, with a focus on bringing new technology solutions and new business opportunities to the forefront. He is responsible for all aspects of ensuring the company’s short and long-term goals are realized and that the corporate strategy is secure and engaged.