Just three days after the release of the iPhone 3G on July 11, Apple announced that it had already sold one million of the new mobile devices, compared to the 74 days it took to sell one million original iPhones. Just how many of those sold are for business use — including banks— is unknown, but enterprises are certainly taking a closer look at the 3G's latest enhancements.
In his June 9 keynote speech at Apple's World Wide Developer Conference in San Francisco, Apple CEO Steve Jobs said the top five commercial banks were among those that participated in the 3G iPhone's beta test. Wells Fargo EVP of wholesale banking Steve Ellis was one banker who took part in the pilot. Ellis, who works on most of Wells Fargo's mobile banking initiatives, has been in talks with Apple about bringing the bank's services to the iPhone. After his experience with the iPhone, Ellis thought the iPhone was something "we could use inside of the company," he says.
A few months prior to the July 11 debut, Ellis—and a handful of colleagues also involved in the beta test—began to connect their iPhones to the bank's environment. Ellis says his overall experience with the 3G iPhone for the enterprise was "very good. Working went very smoothly," he says.
Ellis did have some "pretty technical" recommendations for Apple on the security and user experience points, but noted that they were "relatively minor." He says that much of his feedback was addressed with the final release.
Ahmed Datoo, VP of marketing for Fremont, Calif.-based Zenprise concurs. "I commend Apple for really listening to feedback," he says. Zenprise provides service-management software for the Microsoft Exchange and Blackberry environment. The biggest enhancement to the iPhone 2.0 software is the addition of Microsoft Exchange ActiveSync, Datoo says.
"This release of Apple's has made usability and security improvements," Datoo says. It now allows users to sync e-mail, contacts and calendars, he says. The difference is between push and pull. Before, e-mail users would either have to "pull," i.e., refresh or internally update their iPhone e-mail to reflect updates to their inboxes. Now the e-mail is "push," meaning it is automatically pushed out with real-time updates.
The 3G iPhone has the ability to open more attachments than before, including PowerPoint. "This is important for road warriors," Datoo says. "Execs don't want to take their laptops on the road—they just want their mobile device."
As far as security enhancements, the Microsoft ActiveSync gives IT departments the ability to remotely wipe any iPhone device. "The 1.0 version didn't have this," Datoo says.
"Remote wipe; that's a big deal," says Wells Fargo's Ellis. "Security is kind of a big deal to us. We are more paranoid than most," he says. Ellis notes that Apple looks to the financial industry as the leader in security matters.
Despite these enhancements, the financial services industry is going to be one of the toughest markets for the iPhone to penetrate on an enterprise level, says Gartner (Stamford, Conn.) analyst Ken Dulaney. In a June report, Dulaney wrote that the iPhone "likely has a few more years before it can compete across the board."
Security will be the main factor preventing banks from adopting the iPhone for enterprise use, Dulaney says. "[Banks] may not want to go there," he says. "If you break down security on one device, you break down security everywhere."
Wells Fargo has an iPhone pilot in the works for its employees, Ellis relates. He says the enterprise is ready for it, "we just have to make sure the security is figured out."
The challenges that remain are around manageability and support, Datoo says. iPhones have to be activated through iTunes, which many financial institutions don't allow on employee desktops. This means someone in IT needs to be activating these devices. According to Consumer Reports, set up time for business customers is "considerable," although for personal use, set-up time is about 15 minutes, according to writer Jeff Bartlett.
Other mobile devices, like the BlackBerry, can be remotely activated, meaning that employees have the ability to buy and activate a new device "on the fly," Datoo says. "This release puts a burden on IT, but Apple will improve it," he says.
And despite the fact that at $199 the 3G iPhone is lower-priced that the previous incarnation, BlackBerry devices can be purchased for as low as $99, Datoo says. However, pricing plans, which start at $45 a month for iPhone business users, are comparable across the board.