Will the iPhone Define the 'Third Screen?'

Today's introduction of Apple's iPhone is the most hyped market introduction of a consumer electronics item since, well, the introduction of its predecessor, the video iPod almost two years ago. Beyond all the hype surrounding the device, however, one question television broadcasters want to know is, how will the iPhone affect them?
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Today's introduction of Apple's iPhone is the most hyped market introduction of a consumer electronics item since, well, the introduction of its predecessor, the video iPod almost two years ago. Beyond all the hype surrounding the device, however, one question television broadcasters want to know is, how will the iPhone affect them?

The video portion of the iPhone is much like that of the video iPod in that it will allow users to view content purchased from Apple's iTunes store. However, as one of the first Apple devices to allow real-time streaming (Apple TV was the first), it presents a dynamic that will be very attractive to marketers, according to Richard Doherty, president of Envisioneering in Seaford, NY.

"By Monday morning there could be close to a million new mobile devices in the market that will accept video streaming and that's got to get broadcasters' attention," Doherty said. "This is not a 30-day free event from Verizon. It will be a very attractive demographic for advertising."

Since that streaming could conceivably come from any Web site available through the iPhone's Safari browser, Doherty says that nothing could stop Apple from approaching a network to allow streaming of primetime programming on an iPhone. "The only thing that's missing is a signed contract," he said.

But what are people buying the iPhone for? Do they want an all-in-one device? Gary Arlen, president of Arlen Communications in Bethesda, Md. says the jury is still out.

"Does the world want a 'do-all' device? It will but it will take awhile for the consumer to really embrace a product that can do it all, combining a productive device with an entertainment device," Arlen said. "We're in this unknown transition in which we don't know how many people want portable entertainment."

Many believe that for the iPhone to be a true success, it has to succeed in the enterprise marketplace where Blackberries and Treos rule. As an "entertainment device with a phone attached," as Arlen describes it, a lot of businesses initially won't support it. However, the streaming video capability of the iPhone could make it attractive to the businessperson on the go who wants to get up-to-date information from their favorite cable news channel, for example. And they have to improve the integration of its e-mail, address book and calendar functions, according to Jim Burger, an attorney with the Washington, D.C. law firm Dow, Lohnes & Albertson, and a former lawyer for Apple.

"Businesses are interested in streaming video, like breaking news from CNBC, for example," Burger said, "however they have to give the businessperson real seamless integration with their mail, address book and calendar [functions]."

As for whether the iPhone will be the model for the so-called "third screen" (television and the computer monitor being the first and second screens, respectively), the outlook is good because of the cell phone's ubiquity in today's mobile culture, Burger says.

"I think it has a real shot at defining the third screen," Burger says, adding that the difference between the iPhone and the iPod is that "you don't carry your iPod everywhere."