John Paczkowski

Recent Posts by John Paczkowski

Sell Me an iPhone, Siri

No surprises here: one of the biggest selling points of Apple’s new iPhone 4S is Siri, the speech-recognition personal assistant that’s built into the device.

While Siri still has a way to go if it is to popularize voice as the next major user interface, its natural-language processing and automation abilities are already good enough to be a real competitive advantage for Apple in the mobile market.

It’s pushing competitor costs up, as rivals scramble to come up with equivalent voice command offerings — not a cheap or easy feat, considering the level of Siri’s applied artificial intelligence and speech comprehension.

And better than that, it’s creating a consumer bias towards the 4S, Apple’s newest iPhone and presumably the one with the highest margins.

Sterne Agee analyst Shaw Wu says his latest checks with industry and supply chain sources show broad sales strength across Apple’s entire iPhone portfolio, but most of all for the 4S. Evidently lots of folks who could be spending $99 on the iPhone 4 are opting to fork over another $100 for the 4S — and a lot of them are doing it for Siri.

“Despite global macroeconomic headwinds, Apple continues to defy conventional wisdom with a higher-end product mix,” Wu says. “Talking to industry sources, what’s driving the 4S is better than expected reception of its new Siri software.”

The reason for that? Siri’s voice recognition actually works — and pretty consistently, unlike competing solutions, which are often unreliable. And as of today, it’s still in beta. So it will certainly get better and more powerful over time. And it will continue to drive sales.

To wit, Wu’s forecast for the December quarter, which we’re only about a third of the way through: 26 million iPhones — a new record.


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