For the purposes of this article, the term “iPhone” includes “iPod Touch”, and I’m assuming that your operating systems are up to date.

Along with new firmware for existing iPhone owners, and the new iPhone 3G itself, Apple is releasing this week a new service called “MobileMe”, succinctly described as “Exchange for the rest of us.” In short, it automatically syncs your contacts, calendar, e-mail and photos between your home computer and/or work computer and/or iPhone. It stores these items in a 20 GB cloud of data and is smart enough to push updates to you from any of these categories, wherever you are, as long as you have an Internet connection or cell phone signal.

It sounds wonderful. Unfortunately, it costs $99 (US) a year for one person or $149 for a Family Pack. Calendars and contacts don’t take up much hard drive space, but between e-mail attachments and photos, it wouldn’t be that hard to bump up against the 20 GB ceiling, and it’s $49 for another 20 GB (or $99 for another 40 GB). As of this writing, a 500 GB hard drive goes for around $100. I will admit that managed data storage should be more expensive than buying yourself a hard drive, but twelve times as expensive?

I think we should hold off on signing up for MobileMe for a little while, because if the goal is automatic syncing of your contacts, calendar, e-mail and photos, I predict Google and Yahoo! are going to make this possible for free (and probably with “unlimited” data storage) in the near future. Taking each one in turn:

E-mail

If you use GMail (and I believe everybody should, even if your e-mail address is at a different domain), your e-mail is already syncing with GMail on your iPhone. Having it automatically pushed to your phone isn’t happening, yet, but it will be possible for all applications to take advantage of the “cloud computing” scenario that Apple designed for the iPhone. Do you suspect that Google won’t make a GMail app for the iPhone with push e-mail?

Contacts

With the update to OS X 10.5.3, you can already sync your contacts between your iCal (and by extension, the iPhone) and Google. See previous comment about future push scenarios, but for the time being, it would be a weird kind of emergency needed to make a lack of push technology a serious problem in this arena.

Calendar

I actually originate my calendar with Google Calendar, and subscribe to it in iCal, and by extension, my iPhone. See previous comment about future push scenarios, but Google already has a nicely iPhone-formatted version of the Calendar that loads in the Web browser.

Photos

This is probably the first thing that made me second-guess my temptation to subscribe to MobileMe, mainly because I love my Flickr account. It’s got a long history, and all my friends are there, etc. I can already e-mail photos from my iPhone to Flickr using a customized e-mail address, so that could hardly be simpler. Even so, it appears that Flickr has every intention of making their site as friendly as possible for the iPhone.

Now, I’m merely speculating that Google will come out with native iPhone apps that mimic most of the functionality of MobileMe, but look at Google’s track record. They try everything, and succeed at most of them. My plan as described may not be as elegant as a MobileMe account, but I think it’ll be just as easy, and it’ll cost 100% less.

This is only a prediction. Don’t blame me if I’m wrong. But unless you know something I don’t about Google’s plans, it’d still be smart to wait a month or so and see what they have to offer.

For techies, particularly those who like Apple products, the new iPhone 3G is starting to look nice. The current iPhone already has a mess of cool features, but Apple’s adding speed, GPS, support for Exchange, and many other features to attract new consumers, particularly business consumers.

Most importantly, the price for the entry level iPhone will be lower than less sophisticated devices, only $199.

This price is highly subsidized by AT&T, the only carrier that will officially support the iPhone. For every customer purchase, AT&T provides $300 to $400 to Apple to receive the device. This subsidy comes at a great cost to AT&T, but they’re confident that it will take only two years to recover these costs. Why? iPhone users spend more.

The average phone bill of an iPhone user is $95, almost twice the average of all other customers. If you’re an average iPhone user, you are spending $540 more per year, or $1,080 over the life of the two-year contract, for the privilege of buying an iPhone for only $199. I think AT&T is recovering quite nicely.

Would you buy the iPhone at $199? It sounds like an attractive price at first glance. But what if you had to pay your total $1,279 up front? You’d get to keep your $50 monthly plan with this option.

The good news is this lower price might mean more competitive phone prices across all cellular carriers. The bad news is the higher subsidies may be covered by higher monthly rates.

Information on iPhone subsidy from AT&T Starts Subsidy War, Scott Moritz, Fortune, June 10, 2008.

What if you invested in Apple (AAPL) the day before each of Steve Jobs’ keynote addresses at Macworld and sold the day after? Matt Haughey researched historic stock prices and designed the Keynote Index Fund. A fund of this style would return an average of 2.2% immediate (not annual) growth over two days. According to my calculations, which I figured by starting with an initial amount, adding the returns of each of the two-day periods, I came up with a total increase of about 20% over the 9 year period. That’s not impressive—but if you assume that while not invested in AAPL, you’re in a high-yield savings account, the returns increase dramatically.

If you had purchased AAPL in 1997 and held until now, your investment would have increased over 50 times. As Matt admits, buy and hold wins when compared to this timing strategy.

Keynote Index Fund [A Whole Lotta Nothing]