The Biggest Pluses

Speed: Because the biggest problem with the original iPhone was the slow AT&T (T) network, moving the device to the much faster 3G network, while no surprise, will have a huge impact. This is especially true since data already show that it is by far the most heavily used smart phone for Web surfing. It means that you won’t have to search for a Wi-Fi network to do decent Web surfing.

Price: Less than one year after it was introduced at a hefty $599 price, the 8 GB model of the iPhone will now be two-thirds cheaper, at just $199.

Third-party programs: Until now, in order to get third-party programs on an iPhone, you had to hack it. Now, there will be hundreds of them coming soon, and the handful that were demonstrated by Apple looked impressive, from blogging-on-the-go, to news and sports, to games and even medical software.

The Biggest Minuses

Still locked to one carrier: Even though the greater speed is a huge deal, it only matters if you have good AT&T reception. If AT&T’s coverage in your area is poor, the iPhone is still a bad choice, because Apple, unlike its competitors, doesn’t sell it through multiple carriers in one market.

Still missing some features: They haven’t added a real way to cut and paste, or to save files, other than emailed photos. And there still isn’t any MMS capability–the ability to instantly send or receive media files over the phone network without resorting to email. There’s also no instant-messaging program, though third-party developers are likely to offer these.

Still has a wimpy camera: The original iPhone camera was OK, but, given the phone’s brilliant screen and tight integration with computer photo software, it could stand to be better. It isn’t in this new model.

So it’s only fair that I commend Verizon Wireless for its announcement this week that, starting in the second half of 2008, it will allow “any device” and “any application” to run on its cellphone network, without any restriction, or interference. The only requirement, Verizon says, will be that the devices–phones, computers, anything else–must meet a “very minimal set of technical requirements” to show that they can run on the Verizon network without damaging the network or other devices or services that run on it.

This new, open approach won’t replace Verizon’s current walled-garden system, with its heavy controls. It will exist alongside the current system, as a sort of parallel universe.

Still, this is potentially a huge step, a sign that perestroika has arrived among the Soviet ministries that rule the American cellphone industry. If Verizon Wireless does what it is promising, it could be even more significant than Google’s plan for an open cellphone operating system and its creation of a coalition of companies to support it. The reason is that anyone, not just the companies belonging to a particular alliance or group, should be able to build a phone, a data device, a software program or service, and run it on Verizon’s strong, fast, extensive network.

But, as the saying goes, “the devil is in the details.” And there are a couple of details of the company’s plan that could diminish the sweep and importance of its new commitment to openness.

First is the question of what Verizon means when it says a product must pass a sort of certification to run on the network. In a conference call explaining the plan, Verizon officials insisted that the testing and certification process would be much simpler and less onerous than the hoops companies must now jump through to get onto its network. They also promised the certification process would be “relatively short” and that the fees for certification would be “surprisingly reasonable.”

But until we learn the details next year, we won’t know if the certification process will be a mere technical formality, or a barrier to entry.

Even more worrisome is another issue: user pricing. Verizon officials made clear that, because they won’t be able any longer to limit the types of devices and applications that will run on their network, they will be applying “usage-based” data pricing. While they said this pricing would be “competitive,” any system that charges by the kilobyte or megabyte could be a real deterrent to the blossoming of the wireless Internet that Verizon’s open plan promises.

To be sure, Verizon has real concerns here. The bandwidth available on the cellphone networks is much more limited than that on landline networks. If somebody starts running Internet TV networks, or Web servers, or massive online games over the Verizon network, it could put a serious strain on the system.

But there’s a difference between setting higher fees for truly unusually high usage and erecting a payment system where everyone pays by the byte for even simple, common tasks like email, Web browsing, casual gaming, instant messaging, or simple video or audio streaming.

Taken to its extreme, that kind of metering could–intentionally or unintentionally–kill off the kind of innovation Verizon Wireless says it wants to encourage. That’s because the kind of innovative devices, software and services people are hungering for aren’t about making better voice calls. They’re about using the Internet, consuming those bytes that Verizon wants to meter.

So, let’s give credit where credit is due, but let’s watch how those details play out in the coming months. Verizon Wireless should be praised for giving up some of the control that was stifling wireless innovation in America, in my opinion at least. But, just how praiseworthy the move will be depends on some things we don’t know yet.

One of the nice things about the iPhone is that, like the iPod, it can be easily updated by Apple with new features and bug fixes. When such new software is available, you are notified the next time you plug your iPhone into your computer and the new stuff is downloaded into the phone automatically.

Apple issued its first iPhone update this week. And, while the company billed it as merely a bug-fix and security-improvement patch, in fact it has several small feature improvements that Apple hasn’t announced or documented. These aren’t the big items, like an instant-messaging program, which may come later. But they make the phone nicer to use. Here are a few of these hidden new features I discovered after performing the update:

• In the Favorites list in the Phone module, the iPhone’s equivalent of a speed-dial list, you can now have 50 entries instead of 20. This matches the capacity of the quick-dial list on the Palm OS version of the Treo.
• In the email module, you can now automatically BCC yourself on every message you send, allowing you to get a copy without revealing to the sender that you are doing so. In the original iPhone software build, this option (in the Settings menu under “Mail”) only allowed you to CC yourself, which told the sender you were getting a copy and cluttered the address fields.
• The iPhone can now play music through many previously incompatible car adapters and other external speakers originally designed for the iPod. In the first software build, the phone wasn’t recognized as a music source by some of these devices, which get the music through the iPod connector on the bottom rather than the headphone jack. For instance, after I did the update, I was suddenly able to route the iPhone’s music output through my car iPod adapter, which the iPhone had previously recognized only as a charger, even though it acted as both a charger and an audio adapter for my iPod.

I’m sure readers have found some other secret features in this first iPhone update. Let me know what they are.

• Email me at mossberg@wsj.com.
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