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Discussion in 'MacBytes.com News Discussion' started by MacBytes, Oct 14, 2004.
Link: A Bitter Apple Replay?
Posted on MacBytes.com
Approved by Mudbug
When MS looked at using the MAC OS that was the opportunity lost !! But then how much was lost and would the MAc have disappeared because of it? Likely since there would be no alternative.
MS would have absorbed APPLE and the computer world would be drab forever.
I can foresee Apple allowing people to use FairPlay once the iPod has really penetrated in every area and it becomes affordable to everyone. Right now they are forcing their way into the market and once they dominate they'll start giving people the choice of what mp3 player they want to use but no one will want to use anything but an iPod because it will be such an icon.
Here we go again.....
It seems that this discussion here repats itself over and over again, as media pundits repeat themselves over and over again....
This is a tricky question, and I can see it both ways. You'd hate to see Apple make the same mistakes twice, but I would also argue that their music system is a different situation than the Mac OS. I'm interested in hearing what others have to say about this...
IMHO, I think Apple should keep doing what they're doing, just concentrate on making sure the iPod remains better than other music players out there. So that means getting the price down, and adding things like FM radio (if people want that), better batteries, even better form factors, etc.
I can't believe this is getting rehashed again either and if you are going to bring it up at least say something insightful. For something worth reading check out http://daringfireball.net/2004/08/parlay.
I think Mr. Salkever and I are of like minds on many points in his article. However I think the execution strategy he has in mind for Apple is just wrong:
For newsweek that is an amazingly obtuse comment. SOME is a variable. You can't speculate on how this would effect sales long term. Its a foregone conclusion if you license out fairplay to other players its going to cannibalize iPod sales. Its not a question of if it would. It just would. Period.
Apple has 2.5 options here. Either cannibalize iTMS sales or cannibalize iPod sales. I think we are looking at a no brainer here. iTMS is barely breaking even as it is. If it means licensing out fairplay to allow other music stores to be compatable so be it. iTMS will obviously take a hit but here is the one big point that people miss. Why do users use Internet Imploder and Media PLayer on Windows when there are obviously other, better, alternatives? Because its already there. Its built in. As is iTMS into iTunes. I beleive that iTMS will always be the dominant music store for the iPod because of this one very simple fact.
This still won't keep iPod from slipping from its 60 something market share and lets be honest anyone who thinks Apple can maintain this lead is stupid. Its not going to happen folks. But therein is the problem. People are missing the point of Apple vs. everyone else. This skirmisher is about who becomes top codec dog. The iPod and iRiver are simply delivery methods. The war of who becomes the defacto standard codec is the war that Apple is going to be fighting over the next couple of years. If Microsoft is able to build up another industry around their music store like they did with Windows, Apple could be screwed to a certain extent. Apple will always have the option of supporting WMA. Yah yah yah. I know its a sick thought for you guys but its an option Apple needs to consider in the long run if they lose the codec war.
This is 1984 all over again!
This is 1984 all over again. And Apple, again, will be the distant loser. iPods and iTunes will be a failure just the way Macs and Mac OS X are failures. The comparison is obvious:
* In 1984, Apple had a near-monopoly on both sales and mindshare in computers. Most computers were Macs and Macs were "cool," while MS was struggling to enter the computing field. That's just like today with Apple and iPod/iTunes.
* In 1984, everyone realized that the GUI and mouse were better, and that Apple had done computing right. That's just like today, when everyone appreciates the quality of the iPod and iTunes. Just like in 1984, Apple is considered "the one to beat."
* In 1984, most popular software was for MS-DOS, and would run just fine on Macs. That's just like today with nearly all music being on CD and running fine on iPod/iTunes.
* In 1984, PC software could be quickly and legally "ripped" to Mac, and Mac software could be ripped to run on PCs. That helped people not be locked into one platform, just the way you can now rip CDs made from any music store into any player.
* In 1984, it was the consumer world--not business--that dominated the computing landscape. Just as it is today with digital music.
* In 1984, Microsoft was getting a lot of bad press for poor security. People were fed up with viruses and privacy violations and constant patching. Just the way they are today.
* In 1984, most peripherals and hardware in existence would work with Mac--and much of it would work only with Mac. Just like today with audio hardware and accessories that can work with iPods.
* In 1984, developers and software publishers were strongly allied with Apple, who had just helped them create a whole new market. Just the way so many labels and artists are now standing beside Apple.
* In 1984, Macs were heavily advertised, and nearly everyone understood what they were. They were a household name around the globe. Just like iPods today.
* In 1984, Apple had the ability to make their OS support other hardware platforms instantly with hardly any cost or effort, at any time they chose. They were also able to make Macs run MS-DOS apps and PC peripherals at any time with equally little effort. So they could stay flexible and pick their timing, adding support for competitors only when it was strategic to do so. Just like they can stay flexible today in deciding when and if to enable WMA support on iPod, or license Fairplay to other stores and devices.
* In 1984, the Macintosh quickly became a runaway success. Competing platforms had only a fraction of Apple's market. Just the like the iPod and iTunes today.
And yet, with ALL those things going for Apple, the Mac today is still a failure. Therefore, the iPod will be too. The iPod will NEVER gain a large market share, because the Mac didn't. Apple will never be seen as a leader, and never be regarded highly by consumers. They will never make a decent profit, and can never challenge Microsoft in any field--after all, no Microsoft venture has ever failed before. Just look at Microsoft cordless phones and wi-fi hardware--brilliant successes, because what Microsoft wants, it gets.
Microsoft drove Sony and Nintendo out of gaming. They drove Logitech and Kensington out of input devices. They drove AOL and Earthlink out of Internet services and portals. Apple and iTunes are next--and just like in 1984, Apple has only themselves to blame.
Okay ... I'm no Sun Tzu here, but it seems like moving from a strategy which is working, worrying the hell out of your competition, and has a positive future, to a strategy in which you take on mano-a-mano your enemy who has ten times the force as you ... well, I don't see that as a winning move. Somewhere a few paragraphs after the famous advice about land wars in Asia is advice about taking on Microsoft in an ad/licensing war, I'm pretty sure of it.
Microsoft's strength is WMA. It wants WMA to be the de facto standard of music encryption throughout the world, from DVDs to movies to telephones to radio. You name it; if it's audio, Microsoft has a plan to make it Windows Audio. Ceding large ground like the iPod to Microsoft's plans make them that much closer to reality, which is bad for the consumer and catastrophic to Apple. If Microsoft controls the music standard, then Microsoft controls the hardware; this isn't the path Apple took in the 80's and 90's; it's the path taken by Acer and Packard Bell and NEC and Gateway ... and, frankly, as a consumer, I'd rather have one Apple than a dozen Packard Bells. Once the software becomes controlled by a compound monopoly (meaning, a monopoly kept so by monopolies in other related areas such as computer operating systems for businesses, etc), the hardware finds itself on a short and slippery slope into being a commodity.
Commodities don't make money. Monopolies make massive amount of money. In between, you have both thriving innovation *and* profit *and* reasonable cost. As a consumer, that's where I want Apple to be. As a stockholder, I'd love for Apple to be a monopolist, but am very happy with the fierce-competitor stance it has taken instead.
Licensing FairPlay to other music stores is just plain silly. Why would you do that? What would it benefit me, the consumer, to be able to go to either BuyMusic.com and have a crappy experience and try to get a song onto my iPod versus just going to iTMS and getting that song onto my iPod? Price? Doesn't seem to be a factor, and, frankly, the 10-20 cents I might be able to save by buying an album from one store versus another store is completely dwarfed by the time it would take to find the cost leader on the album I'm looking at, even barring the DRM format issues that would be involved today. Honestly, most of the profit in online music sales is going to the record companies. Apple's not making a mint on iTMS, nor are Napster or MusicMatch or Buy.com or any of the others. How might the record company split be reduced? The only way it will go down is by cohesive, concerted pressure from its sales channels. Do you think Microsoft and Napster and Apple would all be able to go to a particular label and say, sorry, we need to negotiate a lower price now? Or, alternatively, do you think they *all* would stand up against a label coming to them saying, Sorry, we want more money per track now... Not likely. The label can quite simply say, well, if you wont give us what we want we'll go to [name your online store here] and get it.
Today, the labels can't raise prices, because they can't play the stores against each other. 70% of their digital download market is Apple, and that 70% can't go elsewhere because it maps to the 90% of portable player buyers who are buying iPods. Yeah, a label might say it will just shift all its business to Microsoft instead of Apple, but who would get hurt the most in the short term there? The label.
All in all, this is, was, and always will be, a stupid line of reasoning. Apple is doing gangbuster business with a tightly integrated, easy to use, single-vendor system. The various licensing schemes proposed all have the same fatal flaw: they favor marketing dollars over design finesse and current market position. It would be market suicide to go for any of them, and Apple is just smart enough to know that.
If OS X is a failure I don't want success
Wow, this was brilliant satire, nagromme. I was fooled for a bit, until I read your last two paragraphs. Then I realized the point of your post.
Just brilliant. Thanks!
OS does not = Music, people love music
Apple software will only work on Apple hardware does not = iPod plays most music formats except WMA & associated DRM
iPod & iTMS is the digital music market
MS & licensee's are picking up what's left and the more iPod sells the less significant everyone else is. If sales stays from 66% to 90% of market until the market peaks and then declines ( which will happen ) its a no brainer; no one else will matter for some time. I am sure Apple has a "magic number" to which they would consider licensing.
iPod sales are not tethered to anything else but coolness & ease of use,
Windows sales were tethered to the presence of DOS, what I use at work
Taking bets on fear of viruses for your WMA portable music player, anyone?