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Back to the Future: Why the iPhone 4S Matters Less Than the 3GS

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Were you disappointed by the iPhone 4S? Too bad.

The world's most highly valued company fulfilled its promise. It gathered journalists into its Cupertino headquarters and came through on its pre-event proclamation: 'Let's talk iPhone'. Consumers and journalists alike simply focused on the wrong model. Apple's excitement was not about the iPhone 4S, but the iPhone 3GS.
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Tim Cook, in his maiden speech following Steve Jobs' retirement, dropped hints from the beginning.  "Despite all [its] success and momentum, the iPhone has five per cent share of the worldwide market of handsets," he explained in a rare, but crucial moment of humility. "I could have shown a much larger number if I just showed smartphones, but that’s not how we look at it." Apple events are famed for their slow burn beginnings, but this was the second most important statement of the evening. It was followed by the most important: "We believe that over time all phones become smartphones. This market is an enormous opportunity."

The world missed it: Apple is going mass market.
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It is also going business. "Momentum is far outpacing the industry. It’s not just consumer, 93% of the Fortune 500 are testing or deploying the iPhone. It’s consistently rated #1 in every customer satisfaction ranking I can find." Business and mainstream consumers share two common traits, they are cheap and they are slow. It you're reading this then the likelihood is the majority of your friends have some kind of smartphone. The iPhone 4S is for you. It is for the five per cent. The iPhone 3GS is for the remaining 95 per cent.  

By keeping a two generation old handset Apple is making a couple of serious statements. Firstly that you can now own an iPhone for free (with obvious contractual caveats), and secondly that it isn't abandoning older tech. Corporations move with the agility of oil tankers and knowing investment in a range of handsets won't see them rendered obsolete in two years is as significant as their reduced price tag. Whatever the reason(s) eager fanboys didn’t get their shiny new iPhone 5, a considerable factor for Apple will have been keeping app development flourishing across older models. Running iPhone apps on an iPad is already a clumsy experience, introducing yet another display size and screen resolution will only make that worse.  

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