In case you didn’t follow the Apple earnings call last night (which I’m ashamed to say I did), you might have missed the news (reported everywhere) that Apple just had their best second quarter in their history. That’s in the midst of a horrible recession. Everything was roses for Apple in all but one category - Mac sales were down 3%. That’s against an industry backdrop of a 7% drop in sales. But it’s still a drop. When asked about it, Apple said the consumer space was doing great for them (read, MacBooks) but the professional and educational space was down. So, personal purchases haven’t been affected by the recession, but company/government spending is down.

If Mac sales are down, how was this the best Apple second quarter ever? The iPhone and the iPod Touch. They’re selling like hot cakes all around the world. In the next few days the App Store will have it’s 1 billionth app download. In seven months. In the last few weeks there have been blog postings from PSP game development companies to small mobile app development companies talking about iPhone development. All of them in glowing terms. Apparently, compared to development for Nokia, BlackBerry, Nintendo DS and Sony PSP, the iPhone/iPod Touch is a dream.

Is it all peaches and cream? No, Android is a serious competitor. It’s much more open then the iPhone platform but has been limited by carrier and equipment. That should be changing over the next year. And the much-hyped Palm Pre will be coming out soon. Advanced press on that device has been very good.

But, to throw another complexity into the mix, the next generation of the iPhone is expected in June, together with the iPhone 3.0 release. That release is set to bring:

  • Full Bluetooth access (phone to phone gaming w/o wifi, transfer of business cards, documents, etc.)
  • Voice recognition
  • Full GPS access (turn-by-turn driving applications from folks like TomTom running on your phone)
  • Micro payments within applications (this has huge potential)
  • Push notifications
  • Full external accessory access (control accessories connected to the iPhone port, e.g., insulin tester)
  • Interface improvements (cut and paste, full content searching, MMS, app integrated email, data detectors everywhere, video recording, etc.)

And the next generation hardware will (supposedly) have video hardware that is significantly better then the current model together with an improved camera and a magnetometer (compass).

And that’s with only 21 million sold. So, as this article points out - - the state of the iPhone is very strong.