Apple loyalists, media, and the rest of the us are still recovering from the deluge of iPhone news stories. I can’t remember a day when there was such an onslaught of breaking news within a short period of time. Before, during, and after, the mainstream media, blogosphere, and the Tube media were all blazing with the performance of the year by King Jobs (if you missed the keynote, you can see the must-see event here). Microsoft must be scratching its head, closely followed by the device manufacturers, carriers, and rest of the ecosystem. So what does this mean to me, they must wonder? How do we respond?

Clearly, nobody beats Apple in high-tech buzz marketing and it is an enormous feat to keep the details of the project under covers though pieces of them have been trickling for the past few months. Time does a good story on the events leading up to the launch. NYT’s David Pogue does a good review (Sub required). The beauty of the device is in its simplicity which is to be expected from Apple. I wrote a vision paper for a client back in 2002 which talked about how difficult it is to use simple and generic features on wireless devices such as address book, SMS, voicemail, etc. If the ecosystem will just solve that problem, it will be a huge step before embarking deep into the data services marketplace. Clearly, Apple get simplicity. They don’t want to force the user to learn anything, just have an extremely intuitive design that people get on first glimpse. Visual voicemail is one example. Though i am not sure if they are the first ones to do it, i think there might be some prior art on this. But the multi-touch technology is clearly a break through. Browser experience on the device is unparallel, the ease of use to do voice and text functions were long over-due, handling for digital media is course trademark Apple.

When John Markoff of New York Times asked me last week about what iPhone will do to the industry, my response was, “it will raise the bar to simplify and make compelling user interfaces”. While Motorola has been focused on hardware aesthetics of RAZR (and the likes), RIM on email productivity, Palm and Microsoft on Smartphones (how about simplephones or easyphones), Nokia on a broad portfolio, no one has really focused on the UI. Each generation of the device gets more complex. 3G MVNOs did raise the bar for the industry in terms of UI but not high enough. iPhone clearly changes the game.

There are clear short-comings which will get resolved in the future versions of the phone in 2008 and beyond. Just to round-up – high price (provides no competition to low-medium-end devices), no GPS, no 3G (what’s up with that), low MP, no external memory slot, 1 carrier (that too locked), poor enterprise support, lack of OTA, OSX (yet another operating system to deal with for poor developers), no active screen or deeper personalization .. these will be taken care off in due course will probably give some time to the competition to bring competing products but they better pay attention to UI or else Apple’s marketshare will get into double figures real fast.

In terms of scale, Apple clearly has ways to go. To give you a sense, the number of iPODs sold todate are less than the number of devices Nokia sells in a quarter. Yes, it is a huge market and Apple’s disruption is great for our industry. There are several questions like will Apple work with only select large carriers, will carriers keep falling over to get their hands on the device, will the device be subsidized, will it be opened up at some point? etc ..

All-in-all, a great day for the industry and now we need to start searching for the next rumor-mill story. This one lasted 7-8 quarters, will the next one match up?

ps. Just in- Cisco filed suit against Apple on its “iPhone” trademark. Maybe Apple needs to jack-up the price to pay for the settlement.