SAN JOSE, Calif. – Even for a company that’s mastered the art of product-launch hoopla, Apple Inc. appears to have pulled out all the stops to propel iPhone hysteria into the stratosphere.
Technology analysts say Apple started its publicity campaign for the iPhone uncharacteristically early, first showing off the device six months ago and shrewdly stoking the media feeding-frenzy since then with incremental announcements that have kept the sleek cell phone-multimedia player-Internet browser in the news.
It goes on sale this Friday, and die-hard Apple fans are expected to line up overnight or longer outside retail stores to get their hands on an iPhone for either $500 or $600.
But skeptics wonder whether even the most innovative product could live up to the iPhone’s lofty expectations – and whether the pre-launch anticipation has spiraled too far out of control. Scrutiny of the product is so great that any small disappointment could send Apple’s stock plunging, experts say.
Technology analyst Mike McGuire said Apple fans have elevated the status of the iPhone to unprecedented proportions – “somewhere between electricity and sliced bread.”
“The blessing is you’ve created an amazing amount of demand. The curse is you have a very high level of expectations to meet,” said McGuire, a research vice president with Gartner Inc. “If there’s a misstep, there will be a lot of gloating people in the industry.”
The hype began when Apple Chief Executive Steve Jobs took the wraps off the iPhone at the annual Macworld Conference and Expo in early January. The dramatic introduction – accompanied by thunderous applause and a standing ovation from thousands of Apple aficionados at a San Francisco convention center – was followed up by a public relations blitz and hundreds of articles in blogs, trade publications and the mainstream media.
The iPhone stayed in the news for weeks after the launch, thanks in part to a trademark-infringement lawsuit by Cisco Systems Inc. over rights to the name. Cisco said Apple’s use of the iPhone name constituted a “willful and malicious” violation of a trademark that Cisco has owned since 2000.
In late February, San Jose-based Cisco – which sells a line of Linksys iPhones that make free long-distance calls over the Internet – and Cupertino-based Apple agreed to share the name.
Apple’s iPhone returned to the forefront of newspapers and Web sites in May, as the company stock reached record heights and many Wall Street financial analysts said the sleek iPhone could be a profit-generating machine, similar to Apple’s iconic iPod.
The iPhone has already generated a thriving cottage industry online, with more than 1,100 peripheral iPhone items currently for sale on eBay, including colorful holsters, touch-screen protectors and car adapters.
But the hype has also hurt Apple.
The launch is being so closely watched that Apple’s share price plunged more than 4 percent in a matter of minutes last month after a rumor about a delay was reported on Engadget.com, an electronics Web site. The rumor was quickly corrected by Apple, and the stock largely recovered by the end of the day.
“That just shows how powerful this has become,” said Chris Hazelton, analyst with market researcher IDC, who said the amount of hype is “almost dangerous to the success of the device.”
“God knows what’s going to happen when the reviews come out,” he said.
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