The iPhone: Apple’s Magic Wand?

Even as Research in Motion and Palm target Apple's touch-sensitive wonder phone, the broad outlines of Steve Jobs' grand strategy for wireless domination are coming into focus. Apple is knitting together a broad coalition of companies around a vision of computing that goes far beyond today's hot-selling iPhone and toward a future that combines wireless broadband and touch-sensitive interfaces with built-in motion sensors.

Cisco is experimenting with software that will allow users to "flick" documents from their iPhones to their desktop computers. Intel, which supplies the processors for Apple's desktop and laptop computers, is experimenting with ways to tie motion sensors to maps, allowing users to "fly" through the landscape. Electronic Arts and Sega are building games that can be manipulated by players waving their phones through the air.

And more companies are piling in, too, drawn by a promise from venture capital firm Kleiner Perkins Caufield & Byers to pump $100 million into start-ups building software ready to take advantage of the iPhone's quirky assortment of capabilities. All of this hints that Jobs and team Apple are thinking two moves ahead even as they plot the rollout of a third-generation version of the iPhone. Analysts are betting the new phones will be unveiled June 9 at the annual Apple Worldwide Developer's Conference in San Francisco, or later in June, on the first anniversary of the original iPhone's launch.

Most analysts believe the new phones will add higher-speed connections to wireless carriers and satellite-navigation capabilities to the phone/media player/digital camera/Web browsing gizmo. Touch sensitivity has been a part of notebook computers for many years, thanks to the trackpad. But on smaller devices where there is no room for a keypad or a wide screen, building a smart, touch-sensitive interface is key, argues Roger Kay, president of tech-tracker Endpoint Technologies. "Touch gives you more virtual real estate--you feel like you can see more because you can zoom in and out," Kay says.

Meanwhile, it's already possible to get glimpses of an even wider lineup of devices built around the iPhone's gesture-based interface. A flurry of patents filed by Apple in recent years outline an increasingly detailed vision for the future of wireless gizmos. The company is also quietly snapping up technology that will allow it to build powerful--and power-sipping--wireless devices. The end game: futuristic gizmos controlled by gestures that are tied wirelessly to the world around them, protected by a broad portfolio of patents, and perhaps even running proprietary Apple silicon.