The new iPhone 5 is finally on the market and its new features make all the Apple fans happy. Well…almost all. No matter how perfect this phone seems, with its bigger screen, faster speeds and better camera, there is still one major downside: its new connector, called ‘Lightning connector’, which is smaller and more durable according to the company, and therefore the phone can also be connected to home computers or electrical outlets.
All these seem a dream for the everyday user of the iPhone, but a nightmare for the hotel, car and gym companies that invested thousands in the old connectors. The only thing Michael Mueller, chief executive of Dallas-based hotel chain NYLO Hotels LLC, had to say when hearing the news was “Oh God.” He said that each of his 600 hotel rooms has clock radios with iPhone docks, $115 apiece. You do the math. Now he has to decide whether to replace all the docks with the ones for the iPhone 5 or order the old dock radios for the rest of the 400 rooms which are under construction.
“It’s going to be a problem,” Mr. Mueller said. “We’re going to have to decide if we stock those or if people with iPhones just sort of over time end up throwing one in their briefcase and knowing when they’ll need it.”
Of course Apple has a solution: the $30 adapter that connects the iPhone 5 to many but not all the older accessories. The company said that it changed the connector to fit the thinner phone which now has even more accessories, adapters and other gadgets which cost a fortune. According to ABI research, total aftermarket sales of smartphone accessories sold globally reach $36 billion, with the iPhone accounting for 20% of the market ($7 billion).
The majority of smartphone producers use micro USB cables that have no licensing fee, while Apple has always come up with its own proprietary charges fees and cables, which allow companies to use the “Made for iPhone” branding on their accessories. Of course, this is in favor of the electronics dealers whose profit relies on selling such accessories for Apple devices, since every user is forced to buy the new ones.
“Apple is testing the patience of its fans,” said Tero Kuittinen, an independent analyst and a vice president of Alekstra, a company that helps customers manage cellphone costs. “A lot of Apple fans have a lot of different accessories and use the old systems, so this is going to be a fairly expensive shift for a lot of them.” Makers of iPhone accessories, meanwhile, are likely to be ecstatic, he said.