John Barrett, director of research for Dallas-based market research firm Parks Associates, said lackluster sales of the iPhone would be much more embarrassing for Apple than the poor performances of those previous gadgets, since the phone has been hyped so heavily.
"I think the biggest impact is Apple is going to lose this aura of invincibility that they kind of have," he said. "People look at Apple and they look at the iPod, and they think, 'Wow, this company does consumer electronics stuff really great.' "

In fact, Mr. Barrett expects that the iPhone will struggle to reach the sales goals that Apple has set for the device.

A recent survey by Parks Associates of American households found that only about 2 million people are willing to spend as much as $500 on a product like the iPhone, Mr. Barrett said.

"The price tag is just too high for most consumers," he said. "A lot of consumers don't even want a lot of fancy features to begin with. It's going to be just another phone."

Even if the iPhone does sell as well as Apple hopes, it will clearly be a long time before the device owns more than a tiny sliver of the cellphone market.

British research firm The Mobile World estimated this week that there will be 3.25 billion cellphones in use around the world by the end of 2007.

What's more, 65 percent of the handsets made this year are expected to be inexpensive models sold to developing countries.

While the iPhone is clearly a premium device, it is expected that Apple will release before long a slew of less expensive models, mimicking the pattern it adopted for the iPod.

But Mr. Barrett said there's a limit to how low Apple can go with the iPhone.

"I suspect that they'll offer some less expensive models, the $400 and $300 and $250, stuff like that," he said. But "if you roll out iPhone shuffle, where it's a phone but only holds 25 tracks, then it's really no different from all the other phones out there."

That said, it will be nearly impossible to gauge the success or failure of the iPhone for at least six months or so after the launch.

Mr. Barrett said it will take time for official sales numbers to be released, for AT&T to get a sense of whether the phone is profitable for them as well as Apple, and for consumers to get over the initial euphoria surrounding the iPhone.

"There's a lot of stuff to be sorted out," he said. "And it's going to take some time to see really what's going on. But at the end of the day, you're not going to have any kind of revolution in the mobile phone industry."

Mr. Kagan agreed, saying that, regardless of how successful the iPhone is for Apple, AT&T and the rest of the cellphone industry, only a small fraction of cellphone users will ever care.

"It's not going to make that much different to the marketplace," he said. "But it does raise the bar for this type of phone."

From the article "Measuring success by what standard?" by Victor Godinez.

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