As a proud and delighted owner of a 2G iPhone, I was sitting on the fence last month when Steve Jobs presented the new 3G version at the WWDC in San Francisco. Getting an unlocked version in the UK (I would not go for an O2 subscription obviously ;)...) had a cost, and seeing my investment become obsolete so quickly was quite frustrating. On the other hand, the iPhone is by far THE best gadget I ever had, so anything even better would be too attractive to resist.

So the 3G iPhone was announced and now launched. In terms of hardware, it is more an evolution than a revolution vs the previous version, with HSDPA and A-GPS as the main upgrades. HSDPA will be nice and should offer a browsing experience closer to WiFi. A-GPS is interesting, but still waiting for the apps to make it worthwile on a mobile. However, these two improvements do not hide the fact that the iPhone is now playing catch up with the specs sheet of the flagship devices of players such as Nokia or Samsung:
- 2 MP camera ? Please... The benchmark now is 5 MP with flash and at least digital zoom
- No video support ? Are we in 2008 or 2002 ?
- No MMS ? OK email is great, but some people still like to send pics (or videos by the way...) via MMS for the immediacy and all. Why not giving users the choice ?
- Haptics and some tactile feedback (quite standard now on Motorola, LG and Samsung) would have been nice to improve the user experience of the virtual keyboard
- Memory: why cap it to 16 GB ? The only reason I see is not to cannibalise too much the iPod sales, but still, 32 GB would have been nice....

Even with these shortcomings, the iPhone launch in 21 markets worlwide was a huge success with people lining up for hours from Auckland to New York via Tokyo and London and the demand proving to be too strong for the iTunes activation systems.

There is one basic reason behind it: price and affordability. When Apple launched the first iPhone, they were too greedy and tried to kill too many birds with one stone, so convinced were they of the iPhone uniqueness:
- They did not want to cannibalise iPod sales and therefore forced the mobile operators to sell them unsubsidized
- They required a revenue share from the operators to maximise the value per device
Don't get me wrong, and let me repeat it, it is true that the iPhone is THE best gadget ever. However, when as a customer, you are used to get a new phone for free every 12-18 months, you are not that ready to spend $400/£270/€400 for an iPhone, especially if you can get a top-of-the-range Nokia, Samsung or Sony Ericsson for free. For Apple to have "sold" 6m 2G iPhone under this model is quite impressive and clearly demonstrates how good the device is.

To become mainstream and mass market, Apple had to review its model, hence the success of the 3G iPhone launch:
- Accept the subsidised model, sell to the operators for a guaranteed revenue, get lower margins per device, but achieve major gains in volumes
- Take some lessons from Andy Grove and proactively cannibalise iPod sales

I also think two new developments will support the sales numbers:
- Exchange support opening the gates to the enterprise segment
- 3rd party apps support expanding the range of user experience on the device

As my personal contribution, I took a pic of the line in front of the O2 shop in my neighborhood in London. This is no flagship store, and the line was solid all day long on Friday. As a comparison, there was no line at all when the 2G version got released. On Sunday, it was far quieter, as the store had sold out as almost any other 3G iPhone outlet....

So I am ready to bet the 3G iPhone will become the 2008 bestselling smartphone, far ahead of Nokia, RIM and Windows Mobile. The key question is whether I will upgrade my 2G version or not...