iPhone News Updated

SAN FRANCISCO -(Dow Jones)- The phrase "new enterprise features" in a recent Apple iPhone-related event invite was all it took for some to anoint the iPhone as the next big challenge for Research In Motion Ltd. (RIMM), the world's leading supplier of smartphones.

"Here we go, Apple vs. RIM," the Apple news Web site MacDailyNews wrote shortly after the invite was sent.

The iPhone, a combination phone and digital media player, has evolved from pricey bauble for early adopters to one of the fastest-ever selling smartphones, largely on the backs of a $200 price cut and lots of consumer zeal. But based on expectations for next week's events, some believe Apple may use the iPhone to gain more share of business hardware and software spending, and possibly improve the company's overall position in the corporate world.

Apple is only saying it will discuss the iPhone's software roadmap and those few business-facing features at its Thursday event. But there is growing sentiment among Apple watchers that the company is ready to push the iPhone on the corporate market, drawing on ties with enterprise technology giants such as International Business Machines Corp. (IBM) and Oracle Corp. (ORCL), plus other players such as software maker Salesforce.com Inc. (CRM), which is said to be developing an iPhone-specific feature.

"We're quickly closing in on the beginning of a new chapter in the history of the iPhone, one that could signal how far Apple can take its maiden voyage into the smartphone world," wrote Tom Krazit, who blogs about Apple for CNet's News.com Web site.

Apple has a relatively small share of the corporate smartphone market, at 5%, according to a recent ChangeWave survey, but the iPhone has the highest satisfaction ratings, at 59%, above RIM's 47%.

And there's anecdotal evidence that Apple's market share is growing. FTN Midwest analyst Bill Fearnley Jr. said that according to his checks, iPhone sales were helped in February by the introduction of a corporate iPhone plan that allows AT&T Inc. (T) to bill employers directly.

UBS analyst Ben Reitzes, meanwhile, wrote that any move into enterprise "can help sentiment into the second half of 2008."

"We believe new (iPhone) features could help address issues that are limiting iPhone penetration in enterprise, which is a 278 million-license market at the high end."

An IPhone Walks Into An Office ...

To be sure, it is hard to gauge what if any boost Apple may get to its bottom line should corporations embrace the iPhone. Apple already has 28% of the U.S. smartphone market.

Each iPhone sold is said to generate $100 upfront for Apple, then another $200 over the next two or so years in Apple's share of fees iPhone owners pay to wireless operators.

Those service fees are likely to rise when the iPhone finds its way into a business environment, given that business applications are usually more expensive to use than the consumer-friendly services typically found on the iPhone.

What iPhone's business ambitions means to RIM is equally hard to suss out. RIM, with 41% share of the smartphone market, would be a considerable foe, given its incumbent status and Apple being a relative newcomer to enterprise-class smartphone services.

And RIM expects to keep growing, riding continued hot sales of the BlackBerry in January, which is usually a slower month after all that gift buying. Last week, RIM boosted its fiscal fourth-quarter subscriber-growth forecast by 15% to 20%.

At last report, Apple sold 4 million iPhones, largely to consumers, and reported that iPhone and related products and services revenue was $241 million, or about 2% of total net sales. By comparison, RIM ended its last fiscal quarter with 14 million subscribers.

A RIM representative didn't have an immediate comment; an Apple spokesperson said it had no comment for this story.

Apple And RIM Clashing

Speculation about an iPhone for offices has been around for a while. Indeed, Apple is already said to have begun forging ties with business software providers in relation to the iPhone, which amount to broad hints as to what enterprise applications the company may introduce.

During an October conference call, Apple Chief Operating Officer Timothy Cook said it is working with Salesforce.com, which is reportedly making an iPhone- specific user interface. In January, reports surfaced that IBM was partnering to deploy its Lotus Notes email on the iPhone.

Meanwhile, Apple has worked with Oracle and other top business software providers on notebook and desktop computers, which it can leverage anew with the iPhone. In 2004, Apple's rack-mounted data storage systems for business data centers were endorsed by Oracle.

Apple's smartphone moves, as some see them, also build on the broader ongoing adoption of Apple's computers in the workplace, largely because the usual premium paid for a Macintosh computer has shrunk enough for Macs to gain the attention of more companies. The hope for Apple supporters is that the iPhone could produce a halo effect in the corporate world similar to what the iPod and its universe of accessories has produced with consumers.

After March 6, the next milestone for the iPhone is making it compatible with the fastest of the high-speed wireless networks. A so-called 3G, or third- generation, iPhone is due sometime in June, according to the latest rumors. To date, iPhones use slower, second-generation wireless networks.

"When you consider that it launched part way through the year, with limited operator and country coverage, and essentially just one product, Apple has shown very clearly that it can make a difference and has sent a wake-up call to the market leaders," said Pete Cunningham, a senior analyst at Canalys, a technology analysis and consultant firm.

[Source: http://money.cnn.com/news/newsfeeds/articles/djf500/200802291705DOWJONESDJONLINE000962_FORTUNE5.htm]