mip's scan

A Quick Look at the iPod Touch

So for the past while I've been enjoying the use of the iPod Touch.  There have been numerous reviews of this device and so I'm not going to do an exhaustive review of every little feature here.  Suffice it to say that the iPod Touch lives up to the hype.  Often with new technology, the hype around a new product grows so large that when the device is finally released it has no chance of living up to the hype surrounding it.  The iPod Touch (and first the iPhone) had a lot of hype.  I'm happy to say though that it all works as advertised.  Dive into the video review I've got below; there I'll step through some of some of the smaller, not often mentioned aspects of this device.  It is the little things, the small attention to detail that Apple gives it products, that really enhance the ongoing use of a product.

I Love Being Right

Do you recall a rant I wrote up back in February, 2007?  I was unhappy with the idea of a tax being impose on iPod, with that collected money going to the recording industry to compensate them for stolen music.  I was ticked off with this idea for a number of reasons, one being that it would effectively "fine" me for a crime that I didn't commit (i.e., I don't steal music...I buy it!).  More importantly, I thought that such a levy would basically give people who did steal music the argument that "hey, I didn't steal anything....I've already compensated you (recording industry) through the tax I paid on my iPod".  When I wrote about that, people emailed me for a week telling me I was off my rocker.

Well, seems that the Canadian Recording Industry Association (CRIA), who has been fighting for this levy, has suddenly changed their mind and are looking to NOT have this in place.

The Canadian Recording Industry Association this week quietly filed documents in the Federal Court of Appeal that will likely shock many in the industry.  CRIA, which spent more than 15 years lobbying for the creation of the private copying levy, is now fighting to eliminate the application of the levy on the Apple iPod since it believes that the Copyright Board of Canada's recent decision to allow a proposed tariff on iPods to proceed "broadens the scope of the private copying exception to avoid making illegal file sharers liable for infringement."

The CRIA has come to the realization that they could actually be making the situation worse by imposing such a stupid needless tax.  You don't  fight piracy by making people pay for the stuff they are stealing.  If you've paid for it in advance, you aren't stealing it!  Further, you upset people who aren't stealing music.  That is what I said 7 months ago and I'm glad to see the CRIA has caught up to the program here.  Boy I love being right.

In truth, I think that the industry should embrace what Steve Jobs at Apple is doing.  Through an awesome online store, outstanding iPods and new buying mechanisms like WiFi purchases on the iPod Touch and the iPhone, and creative partnering like WiFi music buying in Starbucks, he's making it way more fun to buy music legally than to go and steal it!

Satellite Radio - Remember What I Said?

It was back in November....of 2005.  I remember sitting in my living room thinking about satellite radio, and the value proposition just didn't make sense to me.  I wrote a post about it and figured it would never fly.  Then in February 2006 I restated my belief that satellite radio was dead...they just didn't know it yet.  That was February 18th, 2006 that I wrote that.

Fast forward almost exactly one year later to yesterday and what do we see...XM and Sirius are planning (hoping) to merge.  Surprised?  I'm not.  How could a market support two players when there is no value proposition to end users? 

Now the question is...if this merger goes through...will it be the saving moment for satellite radio?  I say no.   This was suppose to be the big threat to the iPod's dominance in the market which I never believed for a minute. Merging the companies together doesn't change the offering.  If they want to gain marketshare, they need to offer something more compelling than just not hearing ads on specialty channels.  If they put all their hope in the merger saving them, I'm afraid they'll fall short, again.

What does the merger really mean, if it goes through?  Well, now instead of watching two companies flounder, we can just watch the one.  My prediction, 12 - 18 months, and they'll be out of the market entirely unless something changes to their offering to the end consumer.

An MP3 Tax for Us Canadians?

Like we don't already pay enough tax in Canada...now we have to consider another one.  An MP3 tax eh?  Hmmm?  Because we're all thieving Canadians ripping off music.  You, me, my grandmother.  The whole lot of us.  Sigh. 

I hate this idea of a music tax.  I didn't like it when the Zune launched and they were giving a portion of the sale to the recording industry to compensate them for people stealing music.  And I don't like it now when this kind of nonsense is being looked at here in Canada.

Canadian music industry representatives are re-opening an old debate about MP3 players that could see the average price of the devices climb by as much as $75.

The Canadian Private Copying Collective, an association of composers, recording artists, publishers, and record labels is asking the Copyright Board of Canada to re-introduce a controversial extra fee into the sale price of MP3 players in Canada.

David Basskin, a member of the CCPC's board of directors, said it's time artists be compensated for the copying of their files onto the digital devices.

What does this mean really?  If I pay this tax on my next iPod...well, then the recording industry has been compensated on music I might steal.  I don't steal music!!!!!  I buy my music.  Mostly in iTunes, but still in CD format as well occasionally.   So why penalize me by charging me more for my next iPod?  Does that mean that if I pay more for my iPod and the tax is paid to the Canadian Private Copying Collective, that now I can go unpaid music?  I mean, if they are being compensated for that, then why should I buy music?  This kind of taxing will lead to music theft, not prevent it.  The recording industry cannot, I repeat, CANNOT, have their cake and eat it.  I don't steal music, so don't ask me to compensate you by charging me more for my MP3 player.  If you force me to pay the tax then I've compensated you for something that I don't have...so I should go get it right?

Now some will say..."mip, mip...it isn't about stealing...it is about not copying music, even if you own it, to your digital devices."  Well that is just plain stupid if you ask me.  If you want me to pay for a CD copy of music and pay for a digital mp3 copy of that album...so be it. Say so.  Make both available.  And I'll only buy the digital mp3 version.  If you want to charge me for having multiple formats, that is fine. Consumers like me will just elect to go for the digital version since we listen to the music on our MP3 players.  By why tax the device?  That makes no sense.  That means that if I buy and album and move that to my iPod, the device tax has paid the compensation to the CPAA.  What about in a years time when I by another MP3 player - I pay the tax again!!!!  Thus, I keep repaying to compensate the CPAA for the same album.  Why do they get compensated over and over again?   

I really hope this thing gets shot down.  To get all the details, read about it here.

If You Can't Beat'em, Join'em

In another example of how the iPod continues to hold a strong command on the market, one of their MP3 rivals has finally realized decided that they should offer an iPod accessory.   Sony, of all companies, has released an iPod docking station.

What can I say.  Visually the unit looks... ugly strange.  Why Sony so often uses these big chunky power blocks is a puzzling to me.  From the specs provided it seems to be an average docking station.  So why write about it?  Because of the important trend that it shows.  Perhaps companies like Sony are beginning to realize that battling the iPod is the wrong approach.  If you can't beat'em, join'em right?  It'll be interesting to see what Sony does with their own line of MP3 players going forward.

The Business of MP3 Players

Ok, so while there are no numbers yet on how many Zune have been sold, it is pretty obvious that it is flopping after it's recent release. This isn't surprising and I've written about it before, so we won't
rehash old arguments. For those interested, I did come across some telling "signs of times" for Microsoft's Doom Zune.

According to a research note published Tuesday by PiperJaffray senior research analyst Gene Munster, only 8 percent of 40 retailers surveyed by the firm recommend the Zune to customers, while 75 percent recommend Apple's iPod.

Moreover, some MP3 salespeople hadn't even heard of Zune, even though the players are being sold at their stores, he wrote in his report.

Now the real reason for this post isn't just to be smug and say "told ya' so", but to make an important point. I think Microsoft missed the mark on this because their starting premise was wrong. What was their objective? To make a great consumer product? To innovate and deliver something really new to the marketplace? Nope. The main objective was: kill the iPod. Everybody has the beloved iPod in their crosshairs and in my opinion, they will miss the mark each and every time. You can't out-design Apple. They have it down to a art and science. Their stuff "just works". What Microsoft (or any other vendor for that matter) needs to do is change the game. Until they do that, there is very little for Apple to worry about.

To read more on this, just click here.

Kickbacks to the Music Industry

There is an article in the New York Times that details the deal that Microsoft has cut for the music industry, which is that they'll get a cut of the Zune sales.  That's a share in the revenue from the sale of the device in addition to the sale of music.  This is not how it works on an iPod.  So here are a few thoughts around this arrangement, which I think is terrible. 

Firstly, it shows how desperate Microsoft is to try and knock Apple down from its mighty iPod throne. Even it Microsoft's Zune fails...which it will, the music industry will begin to demand this of Apple.  That can only hurt us the listeners.

More importantly, I hate the tone in the article, where they say:

“It’s a major change for the industry,” said David Geffen, the entertainment mogul who more than a decade ago sold the record label that bears his name to Universal. “Each of these devices is used to store unpaid-for material. This way, on top of the material people do pay for, the record companies are getting paid on the devices storing the copied music.”

What the heck?  First - all the music on my iPod....and I mean ALL!!!...is either purchased from iTunes or ripped from my own collection of over 500 CDs.  So stop calling me a thief by forcing me to pay you, the music industry, a fee for owning an mp3 player.  More importantly is this, though....if you are going to take a fee from owners of mp3 player so you can cover the cost of music that hasn't been paid for....that means then that there should be no problem in the future for people taking music from sources for free.  You're getting paid already right Mr. Music Industry from the likes of Microsoft.  That fee is meant to cover the cost of music that isn't paid for right?  So that means you'll stop suing people who download music for free?  I mean in court, would I be able to say, "There isn't anything wrong with what I did.  I didn't steal this music.  I paid an extra fee when I bought my iPod (or Zune) and that fee compensates the recording industry for music downloaded for fee, so there aren't any damages."  Isn't that right?  I'd bet though that the music industry wants to have it's cake and eat it too.  They'll take a slice from Microsoft's Zune and pressure all the other mp3 player makers as well (hey let's get it legislated shall we...a nice big mp3 player tax to punish all those thieving people we call customers) but then they'll still take steps to make sure you pay for the music.  Laughable.  Downright disgusting.  Sad.

Microsoft, you've opened a terrible can of worms with this one.  Shame on you.

Tangerine - An Interesting Way to Create Playlists

I've been testing a great little application called Tangerine, which integrates with iTunes.  I have so much music on iTunes that I live and die by my playlists.  I create custom playlists like Kids Music for the Car, or Music For Writing.  I also create smart playlists like Andrea Bocelli that aggregates all his music across multiple albums. 

Tangerine adds a whole new dimension to creating playlists.  What exactly is it?  Well, from their blog we read

Tangerine lets you easily create playlists with upbeat music, or playlists for relaxing. It does that by analyzing the BPM and beat intensity of the songs in your iTunes library. As mentioned in the previous post, it analyzes the songs blazingly fast to the tune of more than 3 per second (on an 1.83 Ghz Core Duo iMac).

Ok, descriptions aside, here is a scenario that worked wonderfully for me.  We had some family over on the weekend and my wife asked me to put some quiet background music on.  Now I have a playlist for this that I've built over time (playlist name Dinner Music) but I hadn't updated it in a while.  So I fired up Tangerine and asked it to create a playlist  with a low range of BPM (that's beats per minute by the way) and a lower beat intensity.  Because I'd run Tangerine before it instantly created a playlist for me pulling from all my music only the tunes that matched my criteria.  I'd asked for the playlist to be 2 hours in length and it pulled 33 songs into the playlist for me.  And that was it.  We had nice, relaxing background music that was dynamically pulled together for me.  In a word.  Awesome! 

Tangerine is currently in beta but as far as I can tell, it is a solid little application.  You can download the current version here.

The Zune Strategy

Ah...the joys of being right once and a while.  Remember my post from a few days ago where I said that the real iPod killer will simply be Microsoft throwing gobs of money away to gain marketshare?  Well with today's announcement on the Zune pricing, it would seem to be exactly Microsoft's strategy.

The Redmond, Washington-based software giant has said it plans to invest hundreds of millions of dollars to develop and market the Zune, and acknowledged the investment may take years to bear fruit.

You can read in the announcement that Microsoft doesn't plan to make any money on the Zune this holiday season - they are fully prepared to sell it at a lose.  This is where it becomes tricky and dangerous for Apple.  They can't really afford to take "years of loses" like Microsoft.  I repeat my mantra from before.  This is the time, now that the Zune features and pricing have all been announced, that Apple should strike fast with their next generation iPod to put real distance between themselves and Microsoft.  Failure to do so will see market erosion, reduced revenue and perhaps a spectacular stumble as Sony did with the Playstation products.

Could "This" Be the Real iPod Killer?

What is "this" that I am talking about? 

Money.

That is something that Microsoft has a lot of.  A couple of weeks ago someone sent me an email that alluded to the fact that Microsoft's Zune might not knock the iPod from its market dominant position, but that future versions of it could.  The argument went like this: remember when the Xbox came out, and Sony's PS2 continued to dominate.  But Microsoft sold the Xbox at a loss, never turning a profit on it and then rapidly came out with the next version of it before Sony could deliver the PS3.  If Microsoft can do that with the xBox, is the Zune destined to take the same strategic path?  Microsoft could sell the device at a loss and continue to evolve it until it bested the iPod.  Apple on the other hand does not have the luxury of selling the devices at a loss.

I thought about that approach, and then let it go.  Then I read another opinion piece on another very good blog, Blackfriars' Marketing and they drove the point home even more.  What if Microsoft decided to simply give the Zune away, say sell it for $99?  Now they'd have pushed the price down so far that it could be an impulse buy.  Something people could/would buy and figure, "hey, if it sucks, who cares....I only spent $99."   In this give-it-away-for-nothing scenario it could indeed cause Apple to falter and stumble in the same way that Sony did.  The reason would be, because Apple can't afford to give the iPod away at a loss.  Microsoft has deep pockets and has often given products away by subsidizing them with dollars from their cash cow products, like Windows XP and Microsoft Office. 

Now I still stand by my belief that end users want a complete and robust end-to-end user experience and not necessarily a less expensive device.  If it was cost, then there have been many devices that have already come and gone that cost less than the iPod.  But what if Microsoft delivers an experience that is not as good, but pretty good and virtually free?  Give the device away and make money on subscription fees.  That's what they are doing with the Xbox 360 right?  Losing money on the hardware and making it up on games and Xbox Live?  This pressure that is created by not having to be concerned with what a product launch does to the bottom line is exactly what has caused Sony to become utterly incapacitated by Microsoft.  The same could happen to Apple and we could see the iPod lose marketshare. 

Is all this good for the consumer?  Sadly it isn't.  Microsoft did it with Internet Explorer to kill off Netscape and what did it leave us?  Years where nothing was ever done to advance the web browser.  As soon as Microsoft manages to drive a stake into the heart of Sony, do you think that we'll see revolutionary things being done with the next Xbox?  Not a chance.  Once the competition has been eliminated then it is time to stay the course and begin to make back the money that you lost in the early years.  The same I'm afraid would be true with the iPod.  Once Microsoft could gain a toehold on the market and eventually dominate, they would limit choice and simply make money from the current basket of Zune-products at hand. 

So will it be a single device that comes along to kill the iPod?  No.  It'll be slow death grip that Microsoft applies to slowly try and chock the air supply (cash flow) of Apple's world class product.  What Apple needs to do to ensure that they don't become roadkill like Sony's  next generation game machine is to move quickly and outpace Microsoft.  They need to continue to differentiate the total user experience.  By doing so they can refuse to play Microsoft's price game and force Microsoft to come play their game of innovation.  I was disappointed that Apple didn't launch the next-gen iPod that we thought they did, but perhaps they were bidding their time? Perhaps they want Microsoft to release the Zune and then, once the market sees what it is and what it is priced at, Apple will effectively say "That's nice...but so last year...here is the new standard in portable entertainment."  Then no matter what price Microsoft sets the Zune at, be it $99 or $9, Apple can stay out of arms length.

It is a constant cycle of innovation and not allowing the "other" guy to catch up.  In the scenario of Apple vs. Microsoft however, it isn't just innovation that Apple needs to worry about, its the deep pockets and patience of the Redmond giant.