Eight years later: A look at the iPhone's legacy

The iPhone’s US debut release on June 29, 2007 signaled a transformative time for the US mobile phones market. In many ways, Apple paved the way for smartphone ownership to skyrocket as quickly as it did. With today being the eight year anniversary of its first release, let’s explore the legacy of the iPhone and its impact on the market.

The first iPhone faced a very different market from the one we see today, yet the impact the device has had is unquestionable. According to Mintel’s research, the year of its release was very much a turning point for cell phones, as standard mobile phone sales declined for the first time. At the same time, smartphone sales increased to more than $12 billion.

From 2007 to 2008, companies specializing in smartphones had struggled to gain market share. Released in 1999, the BlackBerry 850, marketed as a pager, was actually one of the earliest mobile devices that could connect to email. The company also released a phone in 2002 with email capabilities, making the brand an early entry into the smartphone market. Yet in 2007-2008, only 3% of cell phone owners had a BlackBerry device and just 1% owned an iPhone, according to Mintel’s research.

As history shows, it was Apple that made incredible gains in the market, and the iPhone was largely responsible for the explosion of excitement in smartphones that occurred between 2007 and the present. By 2010, the iPhone led the cell phone market in terms of social media buzz, and Mintel’s Mobile Phones US 2015 report shows that penetration had increased to 3% of adults by 2008-2009. The iPhone evolved into a dominant market force from there; as of 2015, 33% of US adults own an iPhone, a sizeable jump from 21% in 2014. This is increasingly impressive within a competitive marketplace that saw annual unit sales of smartphones increase from 114 million in 2012 to 164 million in 2014.

How Apple took the mobile phone market by storm

One of the largest factors driving the iPhone’s success was the significant leap it made in user experience. A large share of former smartphones utilized a monochrome display and lacked the touch interface that made iOS much easier to navigate. A color screen and new ways of using it, such as the swiping and pinching features, created engagement as well as appreciation of the user experience and design. More than that, the iPhone became more than simply a device to make calls with – ownership became linked to status. It gave consumers the ability to access the Internet wherever they were and personalize their phone capabilities with apps (rather than the prescribed functionality phones had been pre-loaded with previously), creating the opportunity to become more digitally connected than ever before.

The device also benefited from considerable momentum of the Apple brand in general. The iPhone inherited some of the legacy of Macs, a legacy which has largely been defined by excellent design and a high level of security. For much of the Mac’s history, the platform was perceived to be immune to malware, a claim which Apple softened in its marketing in 2012. The combination of design innovation and existing brand trust led to a mobile device that consumers would both feel safe connecting online with and very positive about simply owning.
65% of US iPhone users consider themselves loyal to a specific hardware manufacturer

Consumer loyalty separates Apple from its competition

The result of this legacy is that Apple now has an incredibly loyal following within the high-end mobile device market. According to Mintel’s research, 65% of US iPhone users consider themselves loyal to a specific hardware manufacturer. Even Samsung, which presents the biggest competition to Apple’s presence in the US smartphone market, lags slightly behind the iPhone in terms of loyalty, with 56% of Samsung smartphone users agreeing that they are loyal to a manufacturer.

While Apple is a force in the US market, the brand is in position to seize more power globally. Mintel’s research highlights that just 9% of UK smartphone owners bought their last handset because it was made by the same brand as their tablet, but this rises to 17% among iPhone users. Mintel’s The Fifty highlights that mobile devices represent one of the top market opportunities in China for 2015, where 99% of consumers living in tier 1-3 cities owned a smartphone in 2014. Additionally, Chinese adults prefer to use the most user-friendly technology (55%), a perception Apple has long held with US consumers.

It’s a particularly apt time to be looking back at the first iPhone, and not just because today is the eighth anniversary of its initial release. The current buzz surrounding the iPhone 6 is reminiscent of that which helped put the first iPhone on the map. Of course, the newest device’s market performance is nothing to scoff at, either. According to Apple CEO Tim Cook, in Q1 2015, Apple sold approximately 34,000 iPhones every hour, leading to a total of 74 million units sold for the quarter. Cook attributed the stellar market performance to excitement surrounding the iPhone 6.

Although the future is always fluid, Apple’s strong performance in countries like China highlights the key opportunity Apple has moving forward. Indeed, Mintel’s research found that while Apple phone ownership among Chinese adults is 23%, a full 10% lower than in the US, over half (51%) of urban Chinese consumers claim they are willing to upgrade to other brands to receive the latest technology. The brand can leverage the legacy it has built within the US to maintain its loyal customer base while using that very legacy to expand its reach in similar markets abroad.

Bryant Harland brings almost a decade of experience working in the tech arena, most recently as a Senior Technology Writer with Brafton News, where he oversaw the editorial team, wrote as a trade journalist and prepared a range of industry white papers.