IT Addict, "High Tech made Simple" / This blog has moved to www.jeremyfain.net

Tuesday, July 04, 2006

Think different, don´t think iPod


Let me start with a little story, and a basic question:
Say you purchased gas for your car, and realized that this specific oil company sells a specific gas that works only with one specific car. Would you be pissed off?

Sure you would. Well, that´s exactly the pattern Apple iPod´s business model is implementing. When you download music on Apple Music Store onto your iTunes software, the only electronic music player that enables you to listen to the music you´ve purchased is your iPod. Does it sound familiar?

iPod´s lack of interoperability confirms the underlying strategic move Apple´s CEO Steve Jobs has made. Apple is exiting step-by-step the software industry in which Microsoft Windows KO-ed Mac OS a long time ago - to do what it does best (design and marketing), & become a consumer hardware devices pure-player, reproducing Microsoft´s monopolistic economics.

The French government, for once, understood what was going on in the entertainment industry. A motion potentially forcing Apple to either open its rather unfair FairPlay technology or exit the historical French market (France is an all-times first-mover into Apple´s new releases and hosts the biggest Apple conference outside the US - named Apple Expo) was recently accepted by both the Parliament and the Senate. Unfortunately, French lawmakers ruled out the possibility to constrain Apple´s upcoming dominant competitive position. There is however still room for fining Apple, and the story made such a media hype that other governments might follow France´s clever move. Let´s hope the world realizes where culture is heading to before it´s too late.

To recapitulate, all what consumers want is to be able to purchase the music they like from the downloading website they want, and play it on the device they had previously bought.

6 Comments:

  • Hello Jerem,

    Let me be the devil's advocate just for a minute. What's wrong with Apple? The only thing not Kosher is that Ipod's buyers didn't know that there were some things they could not do with the device. Otherwise, can we blame Ipod for having an excellent biz plan that has a real logic of profits?
    This being said, the problem is that, in term, Apple's strategy may fail; for customers do (and will) notice that ipods are limited in use. This is the risk and if Apple is willing to take that risk: fine.
    So the bottom line is: apple should write in bold letters that Ipods work only with i-tune and may be limited in use. That's it.

    That's all I have to advocate for Apple. There are a lot to say against it. I leave the job to you guys.

    jd.

    By Blogger Jedi, at 7/05/2006 06:02:00 PM  

  • Interesting thoughts. That would be a sort of solution to the consumer lock-in marketing strategy Apple has been following. But I still believe they´ll never do it. Just look at the girls in the New York City subway: they just believe they´re so cool when listening to their iPod nano! Apple is selling Apple iPod, not an electronic MP3 player device. Only the competition will solve the issue raised in my initial post: Sony, Philips et alii need to come up with great designs and innovative marketing campaigns - in order to position rightly into the minds of potential consumers.

    By Blogger Jeremy Fain, at 7/05/2006 06:08:00 PM  

  • Finally found time to comment on your blog. Jeremy, I think you're mixing itunes music store, itunes and ipod into a one little mess.
    The interoperability problem with ipod that I'm aware of (don't have one myself) is that it doesn't play other formats than AAC and mp3 (like wma).
    It is iTunes Music Store's interoperability problem that you can only play the bought songs on an iPod (or in iTunes), but you have to remember that, as you say, Apple is not a software company (nor a music company), so iTunes Music Store exists only to support iPod sales. Because Apple, as a hardware company, is only interested in selling iPods, iTMS not working for other players is the only justifiable plan.
    On the other hand, digital restriction management works both ways, even if I had an ipod, i couldn't buy songs from other stores as they use microsoft's drm-variant, which unsurprisingly sucks more.

    Kari

    By Blogger Kari, at 7/10/2006 09:12:00 AM  

  • Hey Kari,

    I agree with you. Apple makes money selling iPods, not selling music through iTunes Music Store (that´s only connected with iTunes).

    So, if Apple believes they manufacture the best products, why don´t they f.. open their system? I would then perhaps buy an iPod.

    By Blogger Jeremy Fain, at 7/10/2006 10:19:00 AM  

  • See this week´s issue of The Economist (July 8th - 14th 2006), page 75 (Finance and Economics). Great viewpoint of France´s intent to open up iTunes.

    By Blogger Jeremy Fain, at 7/10/2006 03:51:00 PM  

  • Kari, I heard the governments of Denmark, Norway and Sweden are considering lawsuits against Apple too.

    By Blogger Jeremy Fain, at 7/12/2006 12:45:00 PM  

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