One decade ago, on June 29, 2007, the world was shaken by the arrival of the iPhone. People camped out for days to purchase the new Apple Inc. (AAPL) product, and it lived up to the hype. Within a few short years, everyone had an iPhone in their back pocket.
The popularity of the product itself is not the only way the world has changed since Apple's mobile innovation. Here are 10 ways that the iPhone revolutionized the entire tech landscape.
1. Touch Screen
Although phones with touch screens had been around since 1994's IBM Simon, the iPhone was the first one that didn't need a stylus. (Apple co-founder and then CEO Steve Jobs intensely disliked even the idea of a stylus). The iPhone allowed you to manipulate its interface using only your fingers, which made it easy to use for adults and kids alike. Although navigating a digital keyboard with your fingers could be frustrating for some at the outset, most iPhone users swear by the efficiency of the process now. The touch interface made the stylus look archaic and any phone with physical buttons (which, in 2007, was every phone) look obsolete. This is why virtually every smartphone has a touch screen now--it's the only way that companies can compete with the iPhone.
Editors' pick: Originally published June 16.
Given how inextricable the iPhone and the App Store seem now, it is surprising to remember that the App Store wasn't available on the first iteration of the iPhone. Indeed, it wasn't until the iPhone OS 2.0 was released in July 2008 that iPhone users could download apps directly onto their phones. Apple made it very easy to do so--all that was required of the user was an iTunes account, which they could use to purchase a wide swath of apps from third-party developers.
Although the App Store is a concept that is always associated with Apple, the company actually cannot claim inventing rights. "Apple popularized the notion of the App Store," says Patrick Moorhead, president of Moor Insights & Strategy. "Apple wasn't first with an App Store, but they perfected it." The app stores that preceded Apple's were difficult to navigate. Most of them only existed on computers, and transferring an app from a computer to a phone was never easy. Getting apps off of a phone was an even more painstaking process. The App Store made installation and removal of apps quick and easy, again beating the competition.
The idea of hailing a ride has taken on a completely different meaning in the iPhone era. Now, requesting a set of wheels is as simple as opening up Uber or Lyft on your phone. The iPhone's GPS allows those apps to find nearby cars, and often it's only a matter of minutes before a car shows up. The easy and quick nature of Uber and Lyft have made them two of the hottest start-ups in recent times--but they would not exist if a large chunk of the population did not have a GPS in their pocket. Thanks Apple!
Although iPhones were not the first smartphones to feature a built-in camera, they immediately popularized taking pictures through the phone. The quality of the photos were impressive, and photo-editing and photo-sharing apps such as Instagram encouraged consumers to keep snapping shots through their mobile device. The camera became an accessory rather than a distinct tool with the arrival of the iPhone.
This was to the detriment of the standalone camera market. "The point and shoot market has been decimated by the iPhone," says Gene Munster, longtime Apple analyst and co-founder of Loup Ventures. Indeed, this is well demonstrated by the failure of the Flip Camcorder, a product that Cisco (CSCO) snatched up in 2009 for $590 million. The company discontinued the Flip within two years of that acquisition, as the straightforward camcorder could not compete with the video-shooting ability of the iPhone. Cisco's short-lived affair with Flip demonstrates the far-reaching effects of the iPhone--very few businesses stand unaffected by its popularity.
The iPhone is a social platform, even outside of its calling, emailing and texting abilities. Available through the phone are countless apps that allow users to further share their lives. Two that have had lasting popularity are Snapchat (SNAP) and Instagram--both photo-sharing apps that promote the iPhone's camera feature. Instagram, founded in 2010 and now owned by Facebook (FB) , has 700 million users. Snapchat was founded a year later and currently has 166 million active users.
Both apps helped shape a new direction for social media, one intrinsically linked to mobile devices. In-app interactions have promoted more casual relationships than personal friendships or even Facebook friendships. Perhaps sensing that its social media market was being threatened, Facebook shelled out $1 billion in cash stock for Instagram in 2012. It was a savvy investment, as the popularity of Instagram has only ballooned since then.
Remember when the BlackBerry (BBRY) was the hot phone to have? Those days seem very far away now. The surging popularity of iPhones simply wiped out the market for BlackBerry phones. BlackBerry's smartphone market share has dropped from 20% in 2009 -- two years after the iPhone was first released -- to 0% earlier this year, as it is shipping less than a quarter million smartphones per quarter these days. The company's stock has fallen from $61 per share when the iPhone debuted to $10.54 as of Thursday, June 15. BlackBerry has shifted its focus to software now, but its fall from grace in the smartphone arena proves that Apple is the undisputed king.
The iPhone has also monopolized the mobile gaming market, as many consumers think it is excessive to own a handheld gaming device on top of an iPhone. When there are so many games widely available on the App Store, can you blame them? Gaming is just another aspect of life that has been consolidated into the iPhone, to the detriment of other companies who produce handheld gaming systems.
Two such companies are Nintendo (NTDOY) and Sony (SNE) , which both saw handheld systems fall short of sales expectations in 2011. "Apple's mobile games have badly hurt Nintendo's and Sony's mobile efforts, specifically Nintendo DS and Sony PlayStation Vita," notes Moorhead. Nintendo's update on the DS, the 3DS, was released around the same time as the Vita, and both saw disappointing launch sales. While both systems have stabilized since, largely thanks to savvy marketing by their creators, they have both sold well short of their handheld predecessors (the 3DS has sold 58 million as opposed for 154 million units shipped for the DS; the Vita has sold around 10 million units compared to the 80 million PSPs that Sony has sold). The fact that both gaming devices landed with a thud demonstrates the difficult market for mobile games that aren't available through the App Store.
When iPods started selling like hotcakes in the early 2000s, people started to question whether the sale of one Apple product would have a halo effect upon another. Analysts largely decided it was too difficult to tell if the popularity of iPods had affected rising Mac sales. However, analysts have seen a stronger correlation between the universality of the iPhone and stronger sales for Macs.
"The iPhone does have an impact: it creates enormous awareness for Apple and its products," says Munster. "Even though the Mac market has had its ups and downs, it has grown consistently faster than the PC market in the last ten years."
Indeed, Mac sales have nearly tripled since the iPhone's release, while PC sales have seen only a modest uptick since 2007 (and in fact have declined dramatically over the past five years, as the market reached its peak in 2011). While it's impossible to prove a correlation, it's a safe bet that Apple's computers have benefited from the advent of the iPhone.
Before the iPhone, developers were used to giving up half the revenue or more that their apps generated to distributors. The iPhone changed all of that. Apple decided on a more developer-friendly model, in order to ensure that the best in the business would make their products available through the App Store. Steve Jobs and Co. decided on a 70-30 revenue split between developers and Apple, which has nicely lined the pockets of both parties.
"It's a virtuous cycle," points out Moorhead. "Better apps and services drive iPhone sales which create more app-buyers which incents more apps to be written."
The iPhone has given P2P services a platform, and a large one at that. Indeed, Apple Pay is becoming an increasingly popular way to purchase products, and third party apps such as Venmo have also popularized the digital wallet.
"The payments market is a big one that has been impacted by the iPhone," says Munster. "The way we interact with cash has changed dramatically."
A cashless society has long been imagined, but it may be even closer than we expect. A recent survey found that 20% of Americans already forego cash and rely upon electronic forms of payment. Apple seems eager to usher in this new age--Tim Cook stated last year that his company was "going to kill cash." Perhaps that's for the best--the societal cost of using cash is $200 billion, and the average American wastes 5.5 hours per year withdrawing money from ATMs, a study by Tufts University reported. If the iPhone successfully ends the cash era, it would perhaps stand as the Apple product's most monumental achievement.