To read about the iPhone 4 features in part one of this article, click here.

Apple (Nasdaq: AAPL) was the hot phone in 2008 and 2009. Then came the rush of the Androids. Today over 60 models made by over 20 manufacturers - including 7 of the world's 10 largest dumbphone makers. The first market where the big Google (Nasdaq: GOOG) Android invasion came ashore was the USA in Q1 of this year, and Android shot past the iPhone in the market share of new smartphones sold in Q1. Now in Q2, Android is increasingly invading major other markets vital to Apple, from Japan and China to Europe - and already today Android globally is selling at the same rate as the iPhone. And this while Apple's been around for 3 years and Android only half that. And most Android manufacturers have not had phones out for more than some months.

The iPhone 4 will be loved by Apple loyalists. It will be a very compelling upgrade for most current iPhone users with iPhone 2G or iPhone 3G models. For a short while in June-July-August of 2010, the iPhone 4 will hold its own against rival Androids and other smartphones, but this is nowhere near the great leap forward to keep the iPhone 4 the most desirable phone for the next 12 months.

I do think that Apple is now on a strange path to oblivion. The mobile industry is one where every time a given player has tried to do its own non-standard thing, the global standard version has won. Look at GSM vs. all other digital standards like CDMA, iDEN, etc. Look at 3G, again the global standard, UMTS, also known as WCDMA which totally dominates over the rival 3G standards CDMA2000 and TD-SCDMA. Look at the success of SMS text messaging or MMS multimedia messaging etc. There has to be a standard, and it to be offered on an interconnecting principle. Japan has had the world's most advanced mobile phones for more than a decade, but they do them on proprietary standards and they have not been able to turn that leadership into global success.

Yet Apple comes at us with ever more control and limitations. The iPhone App Store has been having more troubles, the iAd platform as well, and now Apple forces video calling to be done on its devices only on its proprietary FaceTime solution. Apple seems to be headed to an ever tinier circle of Apple fanatics with non-standard parts, non-standard apps, non-standard solutions, and annoying all partners along the way. Look at its very public fight with Adobe (Nasdaq: ADBE) for example around Flash. What is the hassle now with Admob? [I only saw the headline, it seems like yet another battle, like earlier Jobs saying he wants to be the thought police for the world, to make sure there is no pornography on the iPhone and its family. Imagine the iPad, how obvious it is as the delivery platform for Playboy and other adult magazines. If Apple won't let adult content in, then rival tablets will take giant leaps ahead in market share. Didn't we learn this lesson already with video rentals?] And look at how long Apple fought against MMS - now it lists MMS proudly as a major feature in the "short list" of top features for both the iPhone 4 and the iPhone 3GS. 

Finding a new market
First, it's the best iPhone ever. Clearly. And a big improvement. It will sell very well in America this next year. And it will be the very highly favored smartphone replacement model for any existing iPhone 2G or iPhone 3G user. A big market is "guaranteed" for Apple, in the 30 million to 40 million unit range for the next 12 months.

But Android has 60 models by 20 manufacturers. BlackBerry is bigger than Apple and once again, Apple yields the bigger QWERTY market to Research in Motion (Nasdaq: RIMM), to Nokia (NYSE: NOK), to Microsoft (Nasdaq: MSFT) and to all those Android makers who are smart enough to include at least one QWERTY model in the lineup. Apple? When will you give us a QWERTY slider or folder iPhone? You have already admitted that one button is not enough. When will you go for that market - there are literally millions of Apple fans who want an iPhone with QWERTY but won't buy a non-QWERTY phone, so they now go with BlackBerry etc ... And Microsoft - a global giant corporation twice the size of Apple in annual sales, is now full steam in the game and has launched its first branded smartphones. And Hewlett-Packard (NYSE: HPQ), bigger than Microsoft and Apple combined, the industry's biggest player - bought Palm and will turn that around to challenge Apple.

And Samsung, the world's second largest dumbphone maker, launched its Bada operating system and has sold more touch screen phones than Apple every year since the iPhone launched. Samsung will soon sell more touch screen Bada based smartphones than all iPhones sold per year - this is inevitable within about two years, due to Samsung's far greater distribution and far lower price points and far wider product range. And then there is the gorilla in the room, Nokia and its Symbian and the best distribution, the best sourcing and of any handset maker, the world's best record for invention and innovation in smartphone design. Still today, in spite of all that tremendous success and hype around Apple [and RIM], Nokia's smartphones alone outsell the total annual output of Apple and RIM - combined. And this is before we get the first "iPhone killer" from Nokia, its N8, due out shortly.

The U.S. market will love the iPhone 4 and will mistakenly think that is the cutting edge in smartphone design. Because of that, the iPhone 4 will sell very well in America and the local press and analysts will continue to praise Apple. Meanwhile the iPhone market share will continue to be flat for the year, falling toward the end of the year, and Apple's market share growth will indeed have stalled [as I predicted]. Apple cannot get out of the market share trap until it spreads its design across more than one new model per year. Expect Apple to make announcements in that direction during the next 12 months. I am very sure the market share performance will be such a disappointment over at Cupertino, that they will finally admit that they have to go into a multiple models strategy [as I have been pleading them to do for nearly four years now].

That's my first impression of iPhone 4.

More From Bright Side of News*:

You can read from Tomi Ahonen at Bright Side of News* here.

This article was originally published by brightsideofnews.com and modified by The Motley Fool. 

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