iTunes account required for iPhone activation and software updates, not world domination

A variety of authors seem to see a nefarious scheme behind Apple requiring an iTunes account to buy an iPhone. Sadly, this conspiracy theory that Apple requires an iTunes account so it can sell you millions of copies of Finding Nemo and thereby conquer the world is somewhat overwrought. The truth of the matter (or at least my theory of the truth -- I only have soft data validating this) is that the iTunes account is actually required only for two functions:

1. iPhone activation. Apple faced a choice of either requiring an iTunes account to activate the phone and thereby contractually commit you to the hardware and calling plan, or sending you to a Cingular, pardon at&t store to do the same thing. Trust me -- the iTunes account is going to do way less upselling than the at&t sales people. By the way, unless I've missed something, I think this will mark the first time any US carrier has allowed online activation of their phones and phone plans. Once people get over the shock of requiring an iTunes account, this technique might actually set a new convenience standard for getting a mobile phone actually on the air.
2. Software updates. In case anyone hasn't noticed, Apple has promised ongoing software upgrades for the iPhone version 1 for at least two years (at least that's the period over which it is amortizing the hardware sale, so it makes some sense). It needs a way to deliver those updates in a timely and secure way; the last thing you want is for such an update to fail and turn your iPhone into an iBrick. iTunes performs this function for iPods today, so Apple chose to rely on a proven mechanism rather than inventing a new one. Sounds like a smart business and customer experience decision to me, not a conspiracy.

But wait! There's more! Hyawatha Bray has an article in today's Boston Globle comparing five iPhone competitors. Despite the repeated wails of journalists claiming that the iPhone's high price has doomed it to failure, three out of five of the competitors cost more, not less than the iPhone. And for those prices, you get the phone and the hours of joy on hold with your carrier customer service to activate and update it (if your phone handset provider ever bothers to issue updates, which most don't), too!

Hmmm. Let me think about this. Buying an iPhone gets me a great piece of hardware, online activation, no sales people, no time on hold waiting to repeat my account and social security number ten times, and a lower price than the competition. Maybe Apple actually priced the iPhone too low.

Full disclosure: The author owns Apple stock at the time of writing.

Technorati Tags: Activation, Apple, at&t, iPhone, iTunes, Marketing, Software Updates