23 posts categorized "iTunes"

February 24, 2010

Why this iPad Won't Kill the Kindle Platform (and how it could)

Apple-iPad-001

Many have already voiced glowing praise or strong disapproval of Apple's recently announced iPad.  Some proponents, such as Leo Laporte, call it a "Kindle Killer." Skeptics and haters call it "The next Apple Cube."

These judgments are premature, however. Whatever "magic" Apple has in store for the future, there's nothing in the first generation iPad that changes the market dynamics so completely that it will disrupt Amazon's economics with the Kindle solely as an eReader.

People who buy eReaders are typically going to take reading seriously. The advantages that they bring are best realized by certain types of people:

  • Heavy readers who want to enjoy the improved economics that eBooks bring
  • Heavy readers who want to conserve physical space
  • Anyone who travels frequently and likes to read on trips

With these audiences, the iPad falls short for a number of reasons:

1. Nearly twice the cost of entry
The starting price for the iPad is $499. For the Kindle, it's $259. By way of example, assume the average eBook price is $10, with its hard-copy counterparts costing twice that. A Kindle owner must purchase 26 books before breaking even. An iPad owner would need to purchase 50. 

So for the heavy reader, the economics are hard to justify. For the casual or occasional reader, they are nearly impossible -- if they're going to use the iPad over the Kindle simply as an eReader.

2. Back-lit display
The e-Ink technology that drives most eReaders today has some limitations, but it minimizes eye strain compared to back-lit displays, such as what the iPad has. For heavy readers, this is a significant drawback. It means they can't read as much without their eyes getting tired. It may still be viable for those who are not heavy readers, but in that case, the economics make even less sense solely as an eReader, and except by virtue of wide market distribution, Apple's bookstore cannot promise much revenue to publishers, making the marketplace less attractive (especially as a closed system, as it likely will be).

At least the format is open-source anyway, so they don't have to reformat their books specifically for the iPad.

3. Shorter battery Life
10 hours is a lot of time to be reading. And the standby time the iPad promises is remarkable, but a back-lit display capable of showing full-color images, videos and applications comes at a price. With wireless off, the Kindle can go at least two weeks without a charge, so there's no reason to be tethered to a power source for travelers.

Marketing Differences

Because the iPad does a lot of things, it's hard to describe it using terms that are clear and understandable by a lot of people. The tagline for the iPad is "A magical and revolutionary product at an unbelievable price."

What's the frame of reference? It's a "product?" So is a refrigerator. And oatmeal. And manure. 

It's almost as if Apple believes an entire category can be created by adding abstract and glowing adjectives.

Plus, because the iPad does a lot of things, making promises about how many books it holds would undermine its uses as something other than just an eReader. And it is much more than just an eReader. It's a "product" that CAN be used as an eReader. Among other things.

The Kindle, by contrast, says it's a "reading device" and promises simply that it will hold 1,500 books. In other words, more than you'll read over the next five years.

That's much more concrete than "16GB," which is how much storage the entry-level iPad promises.

So, as an eReader, Amazon's Kindle enjoys the advantage of being able to be explicitly sold as an eReader.

Apple Raises the Bar for User Experience

Apple has done some things well. Even as an eReader iPad works in some important respects. The prevailing question is whether it works sufficiently for the consumer at their prices.

1. Intimacy
Though not flawless, the experience of reading a book on the iPad looks to be more intimate than with the Kindle. The page-turning metaphor is direct and closely resembles the experience of actually turning a page of a book. Along with the ability to deliver deeper content through color and multimedia (which is impossible with either the Kindle or a physical book), motivated publishers have the capability to engage consumers like never before possible.

2. Usability
The touch-screen interface allows Apple to dispense with the metaphors that drag down the Kindle. That makes interactions more direct and gives publishers and app developers more flexibility on how they choose to deliver their content. As such, students can hope that Apple's platform makes it easier to consume nonlinear books than the Kindle does. And since anyone with an iPod or iPhone is already familiar with the iTunes interface, assuming the experience of purchasing a book rises at least to that level of usability, there's very little reason to believe the experience would be any more difficult on the iPad than the Kindle.

3. Flexibility
The iPad does a lot of little things well, and it looks like it can be used to specialize or converge however its owner intends. It can be a personal assistant. It can be a gaming device. It can be used to stream music or movies (with the right app and know-how) from a media server. It can be used as a netbook computer (especially with the optional keyboard). It can be used as a home automation control pad. Or it can be used as all of these things.

The beauty and the curse is that the consumer controls what it will be used for.

The problem is that convincing the masses that something that CAN be used in such ways SHOULD be used in such ways relies on heavy, repetitive marketing, positive word-of-mouth, or consumers themselves having the imagination for its divergent possible uses. Oh, plus they must be willing to risk at least $500 on the prospects -- with no guarantee of success.

Here's where it gets exciting

I don't know how the mass marketplace will respond, or how much Apple is willing to reduce its margin to gain a wide penetration for the iPad if at first it does not take off.

But even if it doesn't, if Amazon is smart, they won't take this lying down. Nor will Sony or any other manufacturers of either popular eReaders or tablets. If it's successful, the iPad may either drive down the costs of pure eReaders and/or inspire the development of better interactions.

If that happens, people will be more willing to adopt the platform, the cost of reading will decrease, and publishers will be forced to participate in this space and -- hopefully -- embrace the efficiencies it represents for their entire industry.

Whether the iPad brings Apple financial success or not, Amazon will need to improve its interface (which is already very good for linear reading) and technology. The iPad (and -- perhaps more importantly -- the responses it will engender from rival tablet makers) will likely change users' expectation about how they should interact with books.

Even if Apple doesn't sell as many as they hope, I would still count the iPad a success if it resulted in widespread adoption and use of electronic readers in general. - Cam Beck

August 12, 2008

Adopt Their Goals as Your Own

Steve_jobs_ipod_cover The first principle of marketing is very simple. You have something people want or would want, if they knew what it could do for them. In essence, your goals are married with those of your audience. Once that principle is established, the rest is working out the details.

Just because you have something others want, it doesn't mean they're willing to pay what you're offering to sell it for or where, when and in the way you're offering to sell it.

There's also the possibility that they just might not like you very much.

A negative image, once established, can be very expensive to overcome. Skepticism rarely goes down without a fight. If it did, it wouldn't be skepticism.

The challenge, then, is not just to adopt your audience's goals as your own (to meet them at their point of need), but to convince others that you also have their best interests at heart -- more than anyone else.

Apple Leads the Way
When Steve Jobs insisted on a 99¢ price point for songs on iTunes, he did it over the objections of many in the recording industry, who feared widespread pirating of copyrighted music.

Consider the marketplace at the time. Music was in fact being pirated regularly. Early adopters had been previously accustomed to downloading their music for free on file sharing sites like Napster (before they went legit). The recording industry estimated (possibly inflated) pirating costs to be in the billions of dollars per year, globally, and rather than respond to this by introducing a legitimate alternative, they sued some of the worst offenders.

To the public, Jobs must have appeared to be the knight in shining armor -- standing up to the evil musical dragon on behalf of the silhouetted dancing villagers.

What Apple Did
People wanted a way to download music whenever they wanted it. The music industry wanted a way to sell music in a way that minimized piracy.

Apple built an infrastructure that was capable of aligning the goals of both parties so that transactions could take place the way people wanted it to -- on demand.

As a result, Apple is the hero, but the recording industry is still the villain -- even though consumers are getting more of what they want than they had been.

Don't Be the Enemy
You should never be so married to your processes that circumstances can pit you against the goals of your consumers. This will cause them to hate you, and as I mentioned earlier, if it's possible to overcome such hatred, it's expensive. Just don't do it.

Your chances of success improve significantly if you first correctly identify what business you're in so you can more appropriately map your goals to that of your audience.

If you're an agency interested in tangible results for your client, doing your best work means making sure this question is answered to both your and your client's satisfaction. - Cam Beck

Related Posts
Part 1: Give Them Ads You Want Them To See
Part 2: Give Them Ads They've Asked To See   
Part 3: Build Relationships

December 28, 2007

Fencing In or Building Up: A Tale of Two Strategies

Just as excited techies spread rumors that Apple will offer movie rentals through iTunes for several studios, Wal-Mart announced an end to its movie-download service.

Apple Builds Up
Apple_tv_intro_graphicApple has been working its angle for awhile, but studios have resisted because they worried about their ability to control how their movies get distributed, and at what price.

Details are sketchy at this point since the notoriously secretive Apple has not authorized anyone to speak about it publicly, but there is no indication that these same studios will make the movies available to purchase, or to burn to a playable DVD.

Apparently they are still heavily influenced by their compulsion to control the minute details of consumption, placing barriers in the way for those who either don't have an iPod or who don't want to watch a movie on their computers. Of course, consumers could always buy an Apple TV for about $300, which I'm sure would make Apple very happy.

That's a big commitment to demand of consumers to use a service. Yet, with 30 million iPods sold to date (many of them having the ability to watch movies and, with the right cables, play them on a TV), the existing market, it seems, is large enough to justify the risk, irrespective of how slowly their policies will allow the market to grow.

Walmart2 Wal-Mart Fences In
Wal-Mart, on the other hand,  had to shut down its movie-download service when HP discontinued its video-download only merchant product. It's been a few months since I checked, but this service was never available for Macs, whose tech-friendly owners already familiar with downloading media, though largely loyal to Apple, may have been enticed to use the service, if it did more, better, than iTunes did. 

Wal-Mart's decision to fence in isn't necessarily wrong, because this type of service doesn't reflect their strength as it stands now.

If they truly want to go after this market, though, their best bet would probably be to start building some in-house intellectual property that they could use independently of third-party software vendors who hold animus towards a category of users who would be open to using the service.

Having defined itself as a software company, Apple has positioned itself to adapt to a changing environment. Whereas had they relied on someone else to provide the service for them, like Wal-Mart did, they would have been subject to their whims.

Neither dead nor thriving
Movie download services still have a long way to go before they can gain widespread traction, but in spite of the difficulty in getting the expertise and commitment to handle the creation and maintenance of such a service in-house, the main obstacle seems to be the studios themselves.

Fearing widespread copyright violations, studios demand they be allowed to exert excessive control over how and when people consume their media, which is the wrong approach.

The best way to deal with pirating threats is to make it easier to distribute and consume the media lawfully than to exert the effort it would take to use the media unlawfully. They are never going to  control all piracy. And their efforts to do so are just ticking off the people who have no desire to do so. - Cam Beck

Related Post:
My GooTube-Viacom Solution

December 07, 2007

What iTunes Could Have Been

Red_logoThis is what iTunes should have been.

When someone directed me to a site promising to be the "social music revolution," I was pretty skeptical. I wasn't sure if I could use it, or if I would even have any inclination to. Anytime someone offers something they claim is "revolutionary," chances are it will be hard to use. What's more, I was worried that those who saw the value in the social aspect of the site would be inclined to ask for way more information that they needed.

To my delight and surprise, Last.fm is turning out to be a useful and simple to use music discovery tool. The sign-up process is one of the best I've seen, and the design is very attractive and mostly intuitive.

I downloaded the software and put it in my keyword search ("Christmas"), and now I'm listening to random Christmas music, commercial-free.

23668411959561531 And it isn't just the scrub songs, either. Right now Luther Vandross is bellowing the lyrics to "O Come All Ye Faithful," and I'm loving it.

Supposedly the system will take inventory of my listening behavior and offer recommendations for music I might also like (and even uses this data to help populate my playlist). As someone who has difficulty remembering the names of artists and finding songs that meet my eclectic tastes, this is a feature I really appreciate.

I cannot listen to every song, on-demand, and I shouldn't be able to without having to buy them... But I can listen to 30-second previews of many songs that are in inventory. That way I can confidently ascertain if the album is suitable for me.

The biggest problem I see is that there appears to be no option to use the interface to buy directly from iTunes, since that happens to be my favorite interface for buying music on-demand. Some songs are available for download from Amazon, but so far most of the "Buy" links take me to the page where I can buy the CD from Amazon - to have shipped to me.

If I want it immediately (which I would, since I'd already be in listening mode), I'm out of luck, or else I have to use a different interface (such as iTunes).

If the software allowed me to download the music directly and load it onto my iPod, this would truly revolutionize the way I buy music - and I'd probably buy a lot more of it than I do now.

Perhaps that's something still on the horizon. I sure hope so. - Cam Beck

October 17, 2007

NBC Declares War On "Heroes" Fans

Nup_108635_0315_2 Warning: Spoilers for the TV show, Heroes (site), appear within this column.

I've been watching the second season of Heroes, and I have to admit, I'm not impressed. I can only suspend my disbelief for so long. The show about super-powered human beings once showed great promise, but with all the implausible storylines that defy all reason and logic, I am slowly losing the affection the first season engendered.

My problem isn't that people in the popular NBC show can fly, regenerate, phase through walls, read minds, display telekinesis, or shoot radioactive fireballs from their hands.

I can buy all of that.

What I can't understand is why the writers insist we believe that the characters who displayed such courage and selflessness last season, whose plight everyone knows could have been minimized by the good guys communicating and being honest with each other, can be so dumb, dishonest and selfish this season.

Seriously - Claire's dad hasn't learned a thing about the dangers of holding secrets from his family (which nearly got them all killed last year). Plus, he doesn't have the smarts to hide in a place that isn't populated by people who know or would recognize him. He has seen a glimpse of the circumstances of his own death (seemingly from a long fall and sudden stop on the ground), but he doesn't share this knowledge with his daughter, who he knows is somehow involved.

Claire is hardly blameless, either. The guy Claire is secretly seeing (who, conveniently... hmm... can fly) holds some serious animosity toward the guy who abducted him, which Claire knows to be the dad she loves. Not seeing the potential volatility and imminent probability that of the two of them might ever see, recognize, and be threatened by each other conveniently never crosses Claire's mind.

[I was a teen once, too, NBC, and I'm pretty certain I was never that dense.]

Oh, and her car, which she conveniently left unlocked, was conveniently stolen by a guy who was conveniently arrested in Mexico by police who also happened to conveniently arrest super-powered siblings who conveniently busted the car thief out for his stolen ride in which they very nearly conveniently run over a conveniently placed super-powered villain previously thought to be dead but who was conveniently rescued by those who were conveniently stupid enough to believe that they could control him.

Stop. Just stop. You lost me by the second "conveniently."

I just want to reach out to the television, gently and empathetically put  my hands on the characters' shoulders, smile whimsically and say considerately and lovingly, "QUIT BEING SUCH AN FREAKING IDIOT!"

Of course, with how poorly NBC handled communications with their audience (and Apple) when they yanked their programs from iTunes ("NBC: Our Way or the Highway"), is it any surprise the characters they write are fundamentally incapable of communicating, too? - Cam Beck

September 04, 2007

NBC: Our Way or the Highway

As far as I can tell, NBC will still allow users to go to their website and watch episodes of all their latest TV programs, but as of Friday, they'll no longer make their episodes available for download on iTunes.

The reason? NBC thought users should pay $4.99 per episode, while Apple insisted $1.99 was the right price.

I admit I've never paid to download a TV show, because most of the ones I would consider watching are also available for free. And I can sit through a grand total of five commercials (even 30-second spots, and even if it's the same doggone commercial, as NBC.com served them last season) for a good TV show that normally takes an hour to watch without a DVR.

I'm inclined to take Apple's side here, though. Adoption rates for television episode downloads aren't such that anyone who desires to make any money has the luxury of increasing the cost of entry to the service, which makes use of a media where it is difficult (if not illegal) to transfer ownership, to a level that exceeds what will be the final cost of the entire season on DVD. (a 15-episode season would run a subscriber about $75, and they wouldn't get the benefit of all the features available on DVD, including the ability to lend it to a friend without lending him your media player).

Now users wanting to watch the latest episode of Heroes will have to go to NBC.com and be served ads if they want to watch their shows (which will be removed before the DVD of the season is released), but if I didn't want online video to succeed so much, I'd consider boycotting any company who put their ads on an NBC.com show.

It just bothers me that instead of figuring out ways to give people what they want, they strive to find ways to force people to watch their 30-second spots. Right now it's limited to five per episode (or at least it was before they changed their web player), but that's probably because they don't figure they could get away with forcing users to watch more. Once they do, if their behavior here is any indication, you can expect them to increase the number you're forced to watch, and you can expect to never have the ability to transport the episodes on your media devices without doing backflips and using tools the industry is continuously trying to thwart.

What's your take? - Cam Beck

P.S. Before deciding to publish this, I tried to find anything NBC has said about it, but my Google search for "NBC PR" came up with Apple's explanation, and I couldn't easily find the PR section for NBC's website. Way to drop the interactive ball again, guys. Let's hope you're better at producing TV shows.

Update: MSNBC (via AP) reports that NBC will sell the ad-free episodes on Amazon's Unbox for $1.99 each. The dispute, NBC Universal claims, stemmed from a disagreement over how much control NBC would have over prepackaged offers and pricing, not single-episode pricing.

Even if true, it seems like such a sad reason to refuse to make a deal. People are willing to pay cash for your product in the form Apple is willing to offer it at a price you say you're comfortable with (and indeed even are happy with when it is over at Amazon). Something tells me we aren't getting the whole story.

Unbox works on PCs or on web-enabled TiVo devices, so Mac users and those who want to watch their videos on their iPods (or burn them to DVD and watch it over at a friend's house) are left out to dry.

Any way I look at it, NBC's decision leaves me scratching my head.

June 05, 2007

Steve Jobs Makes A Boo-Boo

Stevejobsipod2005 After accepting the accolades of consumers who desperately wanted DRM-free music, Apple has run into a bit of trouble because the downloaded music files apparently have customers' personal data embedded in them. As the thinking goes, the only people who have to worry about it are those who seek to illegally share music with others. After all, the information doesn't become public knowledge unless the data is made public in violation of the law. This thinking has merit, but it's incomplete.

If the operating motivation behind this initiative is, as Jobs himself says, that,  "People want to enjoy entertainment when they want it, how they want it, on the device they want it on," then it also follows that the right to use and listen to that entertainment must be transferable.

If I, for instance, downloaded a DRM-free song but decided I didn't like it, I might pass it along to a friend, whom I thought was trustworthy. Of course I would remove the file from my hard drive and all my listening devices. Say that friend passes it along to someone else while deleting the music from his listening devices and hard drive. Eventually, if it gets into the hands of someone who isn't so trustworthy, that person might upload it to a peer-to-peer network, where the legal vultures latch onto it, get my name from the file, and sue me for the violation of the record label's copyright.

The above scenario would rarely happen, but the fact that it could happen provides sufficient reason to cast some scorn on Apple's lack of disclosure, which would have helped its customers make more informed decisions. Now it just looks as if Apple was intentionally hiding something.

In addition, Apple increased quality of these files, but many people can't tell the difference. This increase in "quality" came with a 30-cent price increase IN ADDITION TO this information Apple demands be tied to the file -- requiring the customer be held accountable for its use for all perpetuity (or until someone develops a hack to strip the information from the files).

Make it one or the other, Apple, not both.

According to  the Associated Press (take it or leave it), "Apple declined to comment." It wasn't that a spokesman was unavailable for comment, but that the organization declined to comment at all. I presume they will comment later, but I find it surprising that Apple wasn't already prepared for this.

On the other hand, had they simply disclosed their policy before they made the service available, they would have never had to even worry about it. - Cam Beck

June 01, 2007

The Future of Computing

Some interesting things came out of the recent interview of Steve Jobs and Bill Gates. It was great seeing the two giants talk about the technology, past, present and future. And although they are both going to one day retire (and we'll miss them when they're gone), it was refreshing to see that they gave homage to the up-and-coming generation. They both obviously love what they do, and they're optimistic about the future of technology. Check out this video that highlighted the exchange.

Below are two 2006 quotes made in the very halls of ChaosScenario, followed by a quote from Steve Jobs just yesterday.

  1. "I really want to be able to use other music players with iTunes. Don't get me wrong. I like the iPod just fine...but more than that, I like having options. The iPod may very well be the best music device available, but I want the freedom to use another device with my favorite music download service, even if doing so winds up being a bad decision."
    --ChaosScenario, August 9, 2006.
  2. "People want to be allowed to take their movies wherever they go--to use them however they want. As long as the studios don't get that, Apple (plus Amazon, Guba, and Movielink) will meet resistance from consumers in their efforts to adopt this behavior."
    --ChaosScenario, September 14, 2006.
  3. "People want to enjoy entertainment when they want it, how they want it, on the device they want it on. And if you’re a content company, that’s a great thing. But the transitions are hard sometimes."
    --Steve Jobs, May 31, 2007

It looks as if Jobs gets it. Given the marketshare -- and therefore power -- iTunes has, this is great news for consumers. - Cam Beck

May 30, 2007

Apple Keeps Plugging Away

Not one to rest on its laurels, Apple made three significant announcements today. How well it plays out for the company will depend on the adoption rates, but I certainly like this direction it has taken to empower users to consume the content they want, when they want it.

Apple TV will stream videos directly from YouTube
Youtube My biggest concerns about this are the quality and navigability. YouTube users are restricted to certain file sizes, so it's virtually impossible, at least with the current compression capabilities, to fit a feature-length movie in a YouTube film. Part of the greatness of YouTube is how it allows users to bounce around between videos pretty easily. Will AppleTV allow that same sort of discovery, or must the user get up and mess with their computers to push another video through the wireless network? Whatever they do, I can't wait to see reviews on this.

iTunes now officially offers high quality, DRM-free music (EMI only)
We've known this was coming for weeks. Now it's here. I wonder if users without iPods will start using iTunes. I have an iPod, and I don't think I'll be getting the DRM-free versions just yet. Why? To my undiscerning ear, there's not a lick of difference in the two versions that would be worth the extra 30 cents.

iTunes will offer free educational content on iTunes U
Itunesu This has some possibilities. Others have already mentioned that some colleges are offering course lectures online, for free. The websites, though, are notably and unnecessarily difficult to navigate. The use of a familiar interface such as iTunes could aid in solving this dilemma, but I'm not sure universities see the value in doing it. But then, even putting them online absolutely obliterated my expectations, so anything is possible.

Here are my questions for you:

  1. What do you think of these announcements?
  2. What effect will this have on the Apple brand?
  3. How likely is it that these features will be used by content providers and consumers?
  4. Will this affect the way the music, entertainment industries and educational institutions look at the distribution of their content?

- Cam Beck

April 04, 2007

Extending the brand in iTunes

In some ways, a measure of a good brand (or maybe a good marketing agency) is how well it can extend itself into different medium. Most brands (or maybe, again, marketing agencies) have struggled with extending the experience of the brand online. Nike and Starbucks have done a decent job extending their experience online. Now they're trying it on iTunes.

Untitled_4

If you haven't noticed, there are prominent links in the iTunes music store to Nike and Starbucks. Nike's site really focuses on different types of workouts, some featuring specific 'high-energy' artist like Crystal Method. Others seem to allow people to upload their own mixes. There's even a special section for mixes from their athletes include Lebron James, Steve Nash, Vince Carter and Ronaldo.

Untitled2_4

The Starbuck's mixes are a little less focused on their product. I guess that makes sense, it's one thing to have a workout mix but I've never heard of anyone having a coffee drinking mix. The site has some of the mixes offered in their stores and is supposed to give a coffee house sound, whatever that is.

I think Nike does a good job bringing extending their message into music by associating with exercises and sports stars. Starbucks, in my opinion however, doesn't do much for me in terms of extending the brand. It doesn't encourage use of their product and it doesn't really give any kind of experience. It's just music that you can get on other parts of the site. I'm sure that these brands go through a lot of 'hoops' to get on iTunes. If you're going to go through the effort, seems like you should extend your experience like Nike has done rather than just uploading coffee house play lists. - Paul Herring