The iPhone economy emerges

With buzz growing around the iPhone's anticipated launch in June, accessory makers are getting a jump on the market by unveiling cases, docking stations, speakers and other offshoot products weeks and even months in advance.

Since Apple announced the upcoming release of its iPod-cell phone hybrid in January, third-party manufacturers — including many small business — have been jockeying for position in the highly competitive accessories market.

EzGear, a Murray, Utah-based iPod-accessory maker, began offering three iPhone cases in early May, while several lines of ready-for-market cases were showcased at a consumer electronics show in Japan as early as April. Other products that are already available include a car cupholder craddle by Griffin Technology and a scratch-proof screen protector by Invisible Shield, among several dozen others.

Despite having introduced the iPhone in January, Apple hadn’t received approval from the Federal Communications Commission for the device until May 17.

"In my experience in this market, I've never seen such a big anticipation for a product launch," says Andrew Green, the creative director of Digital Lifestyle Outfitters, or DLO, a Charleston, S.C.-based accessory maker. "I don't blame smaller manufacturers for trying to beat the rush," Green says.

DLO, which was bought by Philips in April and is partnering directly with Apple to produce iPhone accessories, had pictures of its own silicone cases leaked online two months ago, Green says. "The pressure out there from people to get photos of the iPhone and anything related to it is incredible," he says.

That pressure has been building up since the beginning of the year, when Steve Jobs declared at the Macworld Expo in San Francisco that Apple would launch the iPhone in June, giving accessory makers an unusually wide five-month window to design and market docking stations, carrying cases, speakers, and other products.

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While Apple produces its own line of accessories, the company has largely ceded the market to third-party manufacturers.

According to New York-based ABI Research, the cell phone accessories market alone is expected to generate $32 billion in revenue this year, growing steadily to over $80 billion by 2012. About 77 percent of that revenue growth will come from after-market accessories, as opposed to in-box accessories, ABI says. Meanwhile, iPod accessories have quickly grown into a separate $1 billion industry, nearly doubling in size every year. And while much of the growth in both markets is being driven by technology and an ongoing consumer trend for personalization, the biggest immediate boost will come from the iPhone, market watchers say. The iPod already commands more than an 80 percent share of the digital music player market.

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