Tony Fadell Talks Original iPhone’s Business Model ‘Disaster’, Amazon Echo, and Self-Driving Cars

iPod father Tony Fadell has been making the rounds in the days ahead of the anniversary of the first iPhone's launch, which is today, June 29. In two new interviews with Bloomberg Businessweek and Reuters shared today, Fadell continued reminiscing about Apple history by discussing the iPhone's "disaster" of a business model over the first year, his view on how the Amazon Echo compares to Apple's creation of the iPod, and his doubt of the self-driving automobile industry.

After a little over one year on the market, Apple had sold ten million iPhones, but Fadell recalled an initially bumpy road for sales of the company's first smartphone. Apple reduced the price of the iPhone during its first holiday season by $200, which is said to have been a factor in helping the company reach its goal of ten million iPhones sold, achieved in October 2008.

Image via Bloomberg Businessweek
Apple has sold more than 1 billion iPhones since June 29, 2007, but the first iPhone, which launched without an App Store and was restricted to the AT&T Inc network (T.N), was limited compared to today's version. After sluggish initial sales, Apple slashed the price to spur holiday sales that year.

"The business model for year one of the iPhone was a disaster," Tony Fadell, one of the Apple developers of the device, told Reuters in an interview on Wednesday. "We pivoted and figured it out in year two."
When looking towards the future, Fadell sees the emerging space of the smart home speaker as an area of huge potential. The former Apple executive argued that only Amazon could have launched the first successful intelligent speaker, Echo, because, "Out of the companies you mentioned—Apple, Google, and Amazon—which ones would you most trust to listen to you all the time? There are very few people who don’t trust Amazon."

He went on to compare the creation of Echo to the iPod and Apple's history of being late to a product category, but attempting to make their entry into the category the best possible option for customers.
I think it’s similar to when Apple came to me and “Let’s do the iPod,” except it wasn’t an iPod yet. We said, “Look at all these shitty MP3 players. I think we can do this better.” I give Amazon credit for it. They weren’t the first home assistant. We at Nest were building one, and there were a couple of startups on Kickstarter and Indiegogo doing this.

But Amazon went, “Oh, maybe we can make a real version of it. Some other company came up with a prototype, and now let’s put our flavor on it.” For Amazon, it’s like a perfect way to take a consumer who already loves them and make ordering stuff frictionless.
In regards to many technology companies joining in on the self-driving automobile craze, Fadell is less enthusiastic about the future. He warned, "Don't believe the hype" surrounding automatic driving systems -- which Apple is readily working on -- and self-driving vehicles, because the technology that will get them to compete with modern vehicles is "a lot further off than people are telling you."
Don’t believe the hype. There are going to be demos, and they’ll get better and better, but to get to the point where you’re going to buy one that can run at a speed that you’re accustomed to—55 miles or 100 kilometers per hour—that’s a lot further off than people are telling you.

I think the car world is going to look pretty similar to what it looks like today. There are new brands, like Tesla and some Chinese brands, that could be challengers in the decade after that, but this isn’t something that is going to happen as quickly as the mobile phone industry changed with the release of the iPhone. Phones get turned over every 18 months. It takes much longer with cars. And with cars, we’re talking about laws changing and police having to adjust to them. It’s a lot harder than rolling out a 3G network and getting people to change phones.
While the interviews covered many non-iPhone topics, Fadell still looked back upon his time with late Apple CEO Steve Jobs and recognized how important the creation of the iPhone was for Apple and all of its customers. "Being able to democratize computing and communication across the entire world is absolutely astounding to me," Fadell told Reuters. "It warms my heart because that's something Steve tried to do with the Apple II and the Mac, which was the computer for the rest of us. It's finally here, 30 years later."

For a deep dive into the history of the iPhone, check out the MacRumors tenth anniversary post for Apple's original smartphone.


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Tony Fadell Talks Apple’s Pre-iPhone Days of Failed Motorola Rokr and Touchscreen MacBook Prototype

Over the past few weeks, former Apple executives that originally led the team behind the iPhone's creation have been reminiscing about the time before the smartphone's debut, which will see its tenth birthday tomorrow, June 29. The latest interview has been posted by Wired, with "father of the iPod" Tony Fadell discussing the multiple prototypes of the original iPhone, Apple's attempt to create a touchscreen MacBook, the poorly received collaboration between Apple and Motorola in the Rokr, and more.

Addressing the "many different origin stories for the iPhone," Fadell pointed out that such stories were the result of Apple's multiple running projects and prototypes that it had for the iPhone. These included four big brands: "a large screen iPod" with a touch interface, an "iPod phone" that was about the size of an iPod mini and used a click wheel interface, the Motorola Rokr, and even an ongoing attempt to get a touchscreen onto a MacBook Pro to further prove the feasibility of the technology that would eventually end up in the iPhone, and never in a MacBook.

Image via Wired
The touchscreen Macbook project was basically trying to get touchscreen technology into a Mac to try to compete with Microsoft tablets. Steve was pissed off, and wanted to show them how to do it right. Well, that might have been the project to show Microsoft how to do it right, but they quickly realised there was so much software and there were so many new apps needed, and that everything had to be changed that it was very difficult. Plus the multitouch itself, we didn't know we could scale it that large to a full-screen display. Those were the challenges over on Mac.
At the time before the launch of the iPhone, the iPod was Apple's most popular product, and Fadell remembered the company's yearly pressure to continue to grow the brand and entice customers "every holiday." Eventually, Apple's collaboration with Motorola was catalyzed by the company's concern over its users asking themselves, "Which one am I going to take, my iPod or my cell phone?" Apple didn't want to lose that argument, so it introduced the first iTunes support in a cell phone in 2005 with the Rokr, which Fadell said "was not deliberately made poor."

Limitations of the Rokr included a firmware restriction of 100 songs to be loaded at any one time on the cell phone, as well as a slow music transfer process from a computer in comparison to devices at the time specifically dedicated to music playback. Motorola eventually ditched iTunes in the Rokr line as Apple continued releasing iPods like the 2005 iPod nano and its ability to hold up to 1,000 songs, which Motorola saw as undercutting Rokr. Of course, rumors were also ramping up surrounding Apple's work on a phone of its own.
No, it was not deliberately made poor. Not at all. We tried our best. Motorola would only do so much with it. Their software team was only so good. Their operations system was only so good. And that experience just didn't work very well. It was a clash of all kinds of problems, it wasn't a case of trying to not make it good.

We were trying to do this because we didn't want cell phones to come eat our lunch, OK? The Motorola Rokr died much earlier than the arrival of the iPhone. This was us trying to dip our toe in the water, because we said, 'Let's not make a phone, but see how we can work with phones to see if we can have a limited number of songs on a phone'. So people could use iTunes and then they would want to move over to an iPod. It wasn't about making it less good because the iPhone was coming. This was well before the iPhone was even thought of.
The company's concerns during its iPod days even looked forward into current technology, particularly over storage capacities and the "celestial jukebox." Fadell said that Apple foresaw users no longer needing to be concerned with storage tiers and paying more for more space, because it "could see a time" when network speeds would ramp up alongside better technology and lead to streaming and downloading directly on a mobile device, like Apple Music and Spotify.
It was very clear, after the Rokr, and after everything we had learned in what it was going to take, that the worry was about the 'celestial jukebox' - people wouldn't have to buy large capacity iPods, 150GB or so, because they were soon going to be able to download. So we had an existential problem, people were not going to have to buy larger and larger iPods. The high-capacity iPods were where we were making all our money, and if they could download at any time - and we could see the time when the networks were going to get faster because of 3G - we were like 'oh my God, we're going to lose this business' to this music jukebox in the sky, which is basically what Spotify is.
In the rest of the interview, Fadell dives into the iPhone team's massive dissection of every possible mobile device at the time to scope out the competition, the remaining similarities between current generation iPhones and original iPods, and the ongoing legacy of 2007's first iPhone.

Fadell said that it changed his life, and "how my kids are growing up compared to how I and my wife grew up," but he hopes iPhone users remember to unplug every now and then: "...it requires all of us to make the proper changes in our lives to make sure we don't lose the analogue portion of our life and we don't just stay digital and mobile all the time."


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Former Apple Executives Recall Designing Touchscreen Interface of Original iPhone

As we near the ten-year anniversary of the iPhone later this week, a few stories posted online have delved into the rich history of where the device started, how the original team came up with the idea for the touchscreen smartphone, and what it was like reviewing the device back in 2007.

In a new video shared by The Wall Street Journal today, three former Apple executives -- Scott Forstall, Tony Fadell and Greg Christie -- have taken a look back at the first days of designing the iPhone with Steve Jobs. Apple's former senior vice president of the iPod division, Tony Fadell, recounted a time when Jobs showed him the company's first demo for what would become the iPhone's touch-based operating system.

Image via WSJ

Jobs and the rest of the team were seeking a more elegant solution to a smartphone interface than the one they began with, which was an iPod click wheel interface, when Jobs invited Fadell into a demo room.
"Steve goes, "Come over here I need to show you something." So he walked me into the room...and it was basically like a ping pong table sized demo with a projector that was projecting a Mac interface on it. And you could use your whole hand and you could touch different things on it, like it was a big big Mac.

It was literally a ping pong sized multi-touch display. And he goes, "I think this is gonna solve our problem."
Former Apple vice president of iOS, Scott Forstall, recalled a specific time in 2005 when the iPhone team was put on a deadline of two weeks to come up with a better design for the smartphone's user interface. Jobs was not satisfied at the time with early iterations of the iPhone's look, and told Forstall and the team that he'd give the project to another group at the company if they failed to deliver.


Greg Christie, former Apple vice president of human interface, said that the team's design ultimately satisfied Jobs, and led to even more work over the next two years before the iPhone's launch in 2007.
"The first time he saw it he was completely silent, he didn't say a thing. He didn't say anything, he didn't gesture, he didn't ask a question. Then he sat back and he said, "Show it to me again." And so we go through the whole thing again and Steve was pretty much blown away by the whole demonstration. It was great work.

Our reward for doing a great job on that demonstration was to, you know, kill ourselves over the next two and a half years."
In 2006, Forstall froze development across the iPhone's user interface divisions to force the team to focus on one troublesome part of the smartphone's UI: the keyboard. At the time, Forstall said it was difficult to use and that if someone tried to type out an e-mail, they'd just "give up."

Forstall explained that one of the best keyboards pitched by a developer had a few clever advantages over all the others designed by the team. Namely, it could intelligently predict words, so if a user would type "T," the keyboard would make the hit region for "H" larger -- while the actual key remained the same size -- so that common words such as "the" were easier to type.

The full ten-minute video created by The Wall Street Journal, which is called "How The iPhone Was Born: Inside Stories of Missteps and Triumphs," is well worth checking out. Other topics discussed by Forstall, Fadell, and Christie include the creation of the iPhone's visual vocabulary (like pinch to zoom and rubber banding to mark the end of a scrollable page), as well as the company's Fight Club secrecy tactics for "The Purple Project," the code name for the original iPhone's creation.


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Tony Fadell Shares New Details on Prototype iPhone Software With Virtual iPod Clickwheel

Earlier this month, Sonny Dickson shared a collection of images and videos featuring an of the iPhone with an early iPod-style operating system called "Acorn OS," based on a clickwheel interface.

The iPod-like software was developed by "iPod Father" Tony Fadell, who shared some new details on its creation with The Verge in an attempt to clarify the backstory behind the software.

Click Wheel-based OS vs. the Icon-based OS that went on to become iOS

According to Fadell, the longstanding story suggesting there were two teams at Apple (one led by Fadell and one led by Scott Forstall) competing with one another to develop the iPhone's OS isn't quite accurate. There were multiple UI possibilities being explored by both the hardware and the software teams, who were working together.

"It was a competing set of ideas, not teams," says Fadell. "And we were all working on it."

He went on to explain that there were two paths in hardware and software UI development going on at Apple "at all times," and that the software shown off in the video is "just what the UI guys were doing, devoid of any hardware." There was never a hardware prototype running the software shown off in Dickson's video, but someone ported it "just for fun." It was only ever a Mac app.

A virtual clickwheel, as shown in the video, was just one path of iPod-style development, as Jobs had the iPhone team explore every possibility. Other iPod-like ideas included an iPod phone with a smaller screen and a click wheel, which was unrealistic, and a hardware-based wheel with buttons, another idea that didn't pan out.
We tried everything. We tried having little buttons on the clickwheel so you could click. There was a Nokia phone where they had a circular pattern for the numbers, in hard buttons, and Steve was like "Go make that work." So we tried that.

And we went, "Steve, give it up, it's going to be too hard. It's not going to work." So we were halfway through, like four weeks or five weeks into it, and we said "This is not working." We pushed this for like another four, five weeks to keep trying, and we're saying, "This is a waste of time." But we had to be ready, because that's what he wanted.
By the time Fadell took over the iPhone division from Jon Rubinstein, Apple was working on a Linux-based OS backed by Rubinstein and a reduced version of OS X, developed by Scott Forstall and Avie Tevanian. the OS X version, codenamed Purple OS, won out, and the Linux version was killed off within a matter of weeks. Purple OS went on to become the iOS software we know today.

Fadell's full interview with The Verge, which goes into more detail about the iPhone's development process, is well worth checking out.


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