The iPhone: Why one little gadget matters so much

With its picture gracing the cover of Time's November 12 "Best Inventions of 2007" issue, the iPhone is undisputed as a technology product that matters to consumers. These days in IT that can mean only one thing -- the enterprise is its destiny.

Just as instant messaging and Wi-Fi access migrated from the consumer to the enterprise environment, so too will the iPhone. User enthusiasm for the device, which made its grand debut on June 29, remains high. In a survey of 110 corporate messaging decision-makers, Osterman Research recently found the iPhone is by far the most-requested mobile device by employees. Seventy-two percent of the respondents say employees are asking for iPhone support. The next most-requested device is the Palm Treo platform at 29%.

Suffice to say, the iPhone is a phenomenon that really matters to employees.

The pressure mounts

Nine percent of companies surveyed support the iPhone in their organizations. While small, that's still impressive given the short time the iPhone's been on the market, says Michael Osterman, president of the research firm. The iPhone stands to gain support in the enterprise from top executives who are early adopters of new technology.

"They'll go to the IT department and say, 'I'm using an iPhone now. I need you guys to support it.' I don't know of many IT managers who are going to tell the CEO, 'Sorry we don't support that,'" Osterman says.

The iPhone pressure already is building at DirecTV, says Erik Walters, manager of sales technical operations for this Enterprise All-Star Award-winning satellite TV service provider.

"I know we have some salespeople who are very intrigued by the iPhone and would love to be able to use it," Walters says. IPhone's GPS-enabled map feature has particularly caught the attention of salespeople who visit electronics stores that are DirecTV resellers.

But DirecTV already supports the BlackBerry platform, and it would be up to the network security people to add in the iPhone, he says.

Perfect, it's not

While IT managers are taking a second look at the iPhone, the device isn't yet enterprise-ready, industry watchers say.

Chris Hazelton, an IDC mobile technology analyst, laughs at the notion of the iPhone as "the Jesus phone," referencing the hype surrounding its launch. Existing mobile platforms offer something iPhone can't no matter how many true believers Apple may have.

"The capability of Windows Mobile to create Office documents is pretty powerful," Hazelton says.

And without support for Microsoft Exchange or IBM's Lotus Notes, iPhone users don't have a secure way to get work e-mail.

That could change depending on how far Apple opens the iPhone to third-party software applications. Initially, Apple only let third-party applications be delivered through the Safari Web browser. Then, after people started adding their own applications anyway, even at the risk of voiding their warranty, Apple blinked. In a move that has encouraged some IT people to take a second look at the iPhone, CEO Steve Jobs said the company will release a software development kit in February 2008.

To satisfy enterprise users who want to make iPhone their work phone, Apple would be wise to allow Microsoft's Windows Outlook as one of those approved applications. In the Osterman survey, 85% of senior managers said on-the-road access to Outlook is "important" or "extremely important." It's also just as important to 73% of IT staff and 66% of salespeople.

If Apple supports Exchange (the e-mail server that sends messages to the Outlook client program), IBM's Lotus or other enterprise applications, that could convince more enterprises to support iPhone for their employees, Osterman says.

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Also, while there are some companies that support just one platform -- Windows Mobile or BlackBerry, for instance -- IT eventually may have to support multiple platforms whether they like it or not, including iPhone, says Rob Dalgety, marketing director for Mformation, a mobile device management software company.

Windows Mobile and BlackBerry may be dominant in the United States but the market is likely to become fragmented as more employees further down the corporate ladder use mobile applications, sometimes on their personal cell phones, Dalgety says. "If you start expecting more employees to be accessing enterprise applications deeper into the organization, sometimes that will not be done on an enterprise-owned device. That implies that fragmentation is going to be quite pervasive across the enterprise," he explains.

Accounting for seepage

The iPhone also can seep into the enterprise at companies adopting the software-as-a-service model. For example, Salesforce.com subscribers will be able to use the applications on iPhones, the company says, because that software is delivered to them online.

But for a few business people, the iPhone's appeal as a consumer device is precisely why it's perfect for their business.

For The Hyperfactory, a 60-person mobile advertising company in New York, the iPhone helps in sales pitches, says sales executive Nicole Amodeo. She and company Vice President Gil Martinez pair their iPhones with their MacBook laptops to serve clients.

"The iPhone is a good thing for mobile advertising," Amodeo says, because its browser delivers the same image of the Web as seen on desktop or notebook computers, rather than the scaled down Web on other smart phones. "I actually have the Web on my phone."