Slashdot Mirror
HP Licenses Apple's iPod & iTMS
grouchomarxist writes "According to the press release here and this article at Forbes HP is licensing Apple's iPod technology for its own MP3 player and use the iTunes Music Store. 'HP and Apple today announced a strategic alliance to deliver an HP-branded digital music player based on Apple's iPod, the number one digital music player in the world, and Apple's award-winning iTunes digital music jukebox and pioneering online music store to HP's customers.'"
apple stands to gain a LOT from this. HP alone probably ships more machines a year than apple, so that's already doubling the distribution of iTunes for them. iTunes really is the key to this one. iTunes introduces them to iPods and iTMS
- tristan
Well not licencing MacOS back in the day was obviously one of the major causes of Apple nearly falling off the face of the planet. So if they want to learn from ther (many) historical blunders and licence the iPod while it is at its current peak of popularity, more power to them. Way to go Steve!
Wow, Jobs licensing out music hardware and software to HP... could a Mac clone be far behind?
I personally avoid HP products like the plague. Having had to support them as a technician has been a nightmare. Besides.. I thought HP's business model was to sell stuff cheap, then charge and arm a leg for refills!
I am the lord of the pun. Dance Knave!
ZD Net quotes Phil Schiller as saying "HP Blue"
Thoroughly smart move by HP - tie into a strong offering from Apple's growing recognition in the field. Apple wins tremendously by getting the backing of additional hardware distribution and essentially provides nothing (support & specs) to turn a profit on the licensing portion while having another route to their system lends it significantly to their legitimacy (and therefore brand exposure).
Any spoon would be too big.
"But hey, I could be wrong, and we could all be getting $99 hPods next December. "
It seems obvious that part of the licensing deal would stipulate that HP cannot undercut Apple's pricing. I would be shocked to see any HP models with anything but the same capacities as Apple's at the same prices. And if anything, they'll be physically bigger, or won't look as nice. Apple's going to keep the high ground somehow.
Considering that an Apple would most likely be on every desktop if they had allowed licensing of their products in the 1980s like IBM did, it's quite wise for them to allow licensing of another succesful, revolutionary product that brings the fruits of technology to the average joe.
I'm glad a good man like Steve Jobs no longer ruminates over his mistake, and instead learns from it. Ironically enough, he even works hand in hand with IBM, now.
With the installation of iTunes, Apple has managed to get QT installed on alot of computers without resorting to whining or lawsuits. Congrats Apple.
Apple has much to gain from this. HP is effectivly giving them a bigger audience to the Itunes music store, in a similar fashion that MS Windows has given Aol via putting links to AOL on the desktop of all new PCs. The strategy is tried and tested; more importantly, it works.
HP also gains by getting a neat bit of kit which they can brand, allowing them to compete against Dell's new musical offering. Seeing as almost everyone is getting in on the act these days, it would seem foolish for HP not too; and why not do it with the best thing that there currently is on the market? Who knows, they might even intergrate it better with the PC? They might even bring the price down a bit. Who know- whatever happens, i'm sure it will be good for music lovers.
This was hinted at in this story.
But, let's think about this for a second. With half a bajillion companies now offering song downloads at $0.99 and none coming to us without some sort of DRM involved, why would we choose one over another? The Apple iTunes store has had so much success because of (1) the sales success of the ipod and (2) the ease on integration of iTunes and OS X.
Now let's turn this into a look at HP. HP's MP3 player (while the MP3 player in question is purely speculative since it has not been released) is probably no different than any other MP3 player and I doubt they could be much better than the Neuros. So this gives us no need to choose the HP music store over any other store. Further, HP hardware is not proprietary in the sense that getting music from the HP store would either be a required method of getting music or the easiest because of a lack of other sources.
This seems to tell me one thing: HP's journey into online digital music sales will most likely be short lived.
Apple needs to get iTunes onto the Windows desktop by default .. otherwise M$ will be able to pull a Netscape manouver pretty easily. I am sure Apple will be able to use this as leverage to negotiate better deals with the Record Labels down the road.
..
Hardware-wise maybe HPiPods will introduce a little competition and make Apple rethink the pricing on the mini iPods
What technology is there to license? It's a portable harddrive. I'm pretty sure HP can build one fo those without needing to license anything from Apple.
It's the design of the iPod that makes it unique, not the technology. That's what HP is licensing.
"From Apple's point of view, I'm not sure what they gain." Because they are getting money through licensing the technology. This is EXACTLY what they should have done with the MacOS back in the 80's. I bet deals like this could cement iTunes as the premier online music store platform.
Um... Could it be cash? What else would "HP Licenses Apple's iPod & iTMS" mean?
I find it funny that capitalism has progressed far enough that people always talk about brand recognition and publicity and things like that as the end goals. It seems to me that when a company is directly receiving cash they're skipping the middlemen.
I'm sure that HP computers will have a pretty good chance at having Quicktime and iTunes preinstalled to support the 'hPods'
not only will this add to the QT base but will ad potential customers to the iTunes music store..
I think this is a really good move for Apple.
Yeah, because no one at Apple would ever think of putting a stipulation in the contract to bar HP from undercutting Apple ...
Macintosh is very popular in Japan. Probably because they supported Kanji back in the 1980s, but also their technology culture fits in with Macintosh better than Wintel.
Do you even lift?
These aren't the 'roids you're looking for.
The scary thing is how many Slashdotters will agree with you, while many will be the same people who just excoriated HP (only four stories ago!) for exporting tech jobs overseas.
"HP is fscking over American IT employees because we let them. Our government won't even.... Ooooh, iPods!"
Apple gains an enormous amount from this- they will further solidify their proprietary audio codec as the standard for internet music distribution. We can be sure that HP won't be the only licensee. Apple has done this exactly right- create the most seamless integration in the industry, then graciously allow what would otherwise be their competition to join the party...
I've been lurking here for a LOOOONG time probably too long.
It seems people are negative towards anything Apple just to be able to say "I knew it would suck". This is a good thing for Apple and I can remember iPod posts people taking it for nothing some calling it "doomed to fail".
Apple is doing things right at least with digital music right now. Them joining with HP creates MINDshare that will boost their image as well as HPs.
If anything outside the tech world sheik is whats cool and lets be honest its what the mainstream is all about.
Sure you'll buy a Neuros and this other guy will buy an iRiver cause he is the one in a thousand who claims Ogg is sent from above.
But lets call apples, apples for a second (PUN WAS intended). Apple and more specifically iPod is the leader of this race and this just gave them a bit more time to get a drink of water.
Should we assume that this will have the exact same internal software, or is there a chance that HP will change things around? I'd love an iPod that could play my Ogg Vorbis tunes.
I wonder if the contract from Apple would even allow this.
Perhaps, for the PC market, HP would want to support Windows Media Audio files... and if as they are doing that, they might as well add Ogg Vorbis support.
I also wonder if HP will put FireWire on all their computers now, or whether they will just depend on the USB 2.0 support Apple already has for the Windows version of the iPod.
steveha
lf(1): it's like ls(1) but sorts filenames by extension, tersely
at $0.99 a track, after the credit card companies and the record industry receive their cut, let's be honest, the iTMS isn't exactly yielding huge dividends on its own merits .
.
the ipod/itunes combination is the horizontal monopoly apple attempting to cut the legs out from underneath the vertical monopoly microsoft with an intellectual attack . the kind of choice apple offers is, "do what you will with your hardware, but do it legitimately and legally." microsoft's model of a free-for-all as long as you're not stealing our applications will not stand the intellectual property war that has descended on the business world
corporations want their patents and property protected . apple will allow them to do so .
While I applaud your apparent patriotism and support for American jobs, I can't help but snicker at this. I am reminded of a friend I used to know who was a VERY staunch vegetarian, she wouldn't even eat food that had been prepared on the same grill or in the same pan as a meat product. And yet she wore LEATHER shoes.
So yes, you have a God given right to buy from whom you like. So I will assume that you only buy "American made" products from companies in the United States?
Do you drive a car or truck? Was it made in America? That's a loaded question since there really is no such thing anymore, I can't think of an automobile company that doesn't assemble vehicles from parts made or assembled in another country. Your vehicle may indeed have been put together here in the U.S. but a large portion of the parts are assembled or manufactured in other countries, essentially "outsourced".
Don't get me wrong, I hate outsourcing as much as the next guy, I work in tech and worry about the job prospects, but this is natural market evolution. It happened in manufacturing a couple (a few?) decades ago. Now it's happening to tech. The country adjusted back then, it will adjust now. Will the process be painful? I think it already is. But I have hope that the outcome will be positive.
So while I applaud your sentiment, I think we need to be realistic and consistent.
It seems obvious that part of the licensing deal would stipulate that HP cannot undercut Apple's pricing.
It's not obvious at all. Remember HP and Apple have radically different business models. HP is all about commodity and volume and price competition. Apple's model is "if it's cool enough, we can charge what we like, even if it means our volume is lower".
And if anything, they'll be physically bigger, or won't look as nice. Apple's going to keep the high ground somehow.
Indeed. This is potentially a win-win, since the two companies are strong in different markets.
Not trying to start a flame but please, please don't start the Ogg Vorbis conversation. This is an APPLE device...APPLE is committed to AAC+Fairplay. Apple knows about Ogg, as do all the other WMA music sites and music device manufaturers.
As hard as it is to swallow, Apple has decided AGAINST supporting Ogg Vorbis in current devices. So have all but ONE music device manufacturer. The market isn't there because as bad as you want Ogg, you will settle for AAC and buy an iPod because it is a more complete package. And if you won't, then you are a market minority so small that Apple doesn't have the time and money to spend reaching you.
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
pretty interesting. but i think its going to be even more interesting when sony get their 'my sony music' store working with their new md's
; -- the corruption of government starts with its secrets. a truly free people keep no secrets. --
Value of iPod just went down due to association with HP and Carly.
really .
how long do you think it'll be before some 18 year old locked in a dark closet with some dev tools pulls another drm shattering job . digital degradation from one analog generation is barely noticeable, and jobs has said it a million times, it's not that difficult to record analog from your cd player . people will find a way to defeat technology, the true way is to teach people that theft is wrong .
Let me be the first one to tell you that vegetarians don't eat meat for variety of reasons, which does not necessarily involve ethical ideology. Vegetarians in most part, avoid animal foods for health concerns, and you would find many, who often consume eggs and milk. Humane animal treatment comes in distant second.
The group you're trying to lump her into is called veganism. They don't eat meat, and at the same time avoid (to most extent) purchasing products derived from animals (i.e. leather, oil, fur, etc). Vegans rank animal rights, environmentalism, and ethics ahead of health.
From Apple's point of view, I'm not sure what they gain.
.wma based (with respect to purchased music), and while it may not be the greatest bit of kit, nor the greatest service HP will sell enough of them with system bundles / special deals / etc. (and even if the content side of the equation blows a user would have the option to use any other .wma based content service, like BuyMusic.com, Music.Walmart.com, etc.)
Mindshare and marketshare, not to mention money. If you want clout with component manufacturers on the hardware side and the Big 5 (soon to be Big 4) on the content side you have to be a volume leader. So lets see what happens if Apple told HP to go fly a kite.
HP comes up with their own player and service (or, more likely license someone else's) that would be
Instead, cut a deal with HP (since they seem to love the iPod and iTunes) and you may lose some money on a per-unit basis, but you are further cementing the AAC format, increasing the volume of the iTunes store, and increasing the volume of equipment that you're buying from hardware suppliers, the latter two allowing you further leverage to bring down costs and/or increase profit margins.
Apple needs to continue to hold a large share of the music d/l market. Let, ahem, others grab too controling a share of the codec pie and they'll use that leverage to lock everyone else out.
I'm sure you'll look very cool riding your Harley Davidson motorcycle in your home-made clothes.
Of course, your hog will be missing a few parts, and you won't have a helmet, but hey, at least you aren't buying anything that was made by those eeeevil foreigners!
I've got news for you... If you are serious about not buying from companies that outsource, I guess you are done visiting slashdot, because there hasn't been a computer manufactured complete in the US out of US-made parts since the 70s.
you know that staking out the high end for apple has to be in the agreement somewhere.
apple learned this lesson the hard way six or seven years ago with the whole "macsimilie" fiasco. basically, apple licensed the spec and the os and the firmware to make mac clones to a bunch of companies to try and reposition themselves as a software company (rather than a hardware company, which they are and always will be)
the result was that companies like powercomputing and umax gunned for the fat-margin at the top end and beat apple at their own game. apple nearly went bankrupt, yanked the deal with os 8, changed ceo's and had to kow tow to msft for a $150mil in emergency cash to avoid the chapter-11 reaper.
steve knows this history well (since he was the replacement ceo). he won't let it happen again, believe me.
2 1337 4 u!
the iTMS is either a loss leader or barely breaks even
That's only true at the current economy of scale; if they crank up the units (songs) sold, the capacity for profit is much, much greater. Making deals with other companies will increase the number of iTunes customers.
~jeff
Now that the news has sunk in a few minutes, I am not so certain HP had a lot of better options.
They are already
(1) fighting off loosing market share to Dell
(2) managing a HUGE merger with Compaq (these things take years to work themselves out)
(3) spending tons in R&D with the iPaq
When HP sat down, they had a few options
The WMA way:
(1) Go with the WMA music store everyone else has and try to differentiate, knowing that at $0.99, the service is basically break even
(2) Build a player in house - a huge R&D expense (and risk) should the solution not work out when they launch head to head with Dell that isn't going through restructuring, has a huge market share, and doesn't have the iPaq taking R&D dollars.
The Apple way:
(1) recognize no one is teamed up with the market leader and WHY THE HECK SHOULDN'T WE!
(2) instead of trying to improve on what 31% of the entire MP3 market has already said they wanted by purchasing an iPod, just rebrand the damn thing like IBM did with the Palm III and be done with it.
The Apple way is less risk (and less money in HP's pocket) but if it turns out to be a fad, then haven't spend tens of millions in R&D and they can walk away. If it works out great, then five years from now, they can build their own in-house if they think they can do it better than Apple.
This is a HUGE win for HP and I bet it has Michael Dell slappin' his head sayin "I could'a had a V8!"
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
Wait and watch how iMacs and such won't be licensed out. Jobs is probably taking medication to avoid exploding while HP makes stuff based on Apple technology.
Licensing out the technology for iPods and iTMS makes a tremendous amount of sense because they are dangerously close to being commodity products. There already are competing and very similar products for both services, many of which are of at least acceptable quality. Apple probably has the better products right now (hence their price premium) but there is little reason to believe that their current technology advantage is sustainable. They are the first movers, but our good friends at Microsoft have proven time and again how little that really means. Apples computers are different enough to avoid much of the direct competition but I would propose that the iPod and iTMS do not share this advantage.
So what can Apple do to combat this inevitable erosion of marketshare due to competition? Either they have to keep some form of value advantage (such as features not available elsewhere), have network effects which make switching other services less attractive or they have to scale the business to gain cost efficiencies from economies of scale/scope.
Apple appears to be doing a little of all three. They keep improving the iPod and iTMS which gives them a technology advantage for now. I do not believe this is sustainable in the long run (lots of other smart engineers out there) but it gives them good margins and a big head start. They've got a better mousetrap but that is only useful to a point.
By producing a Windows iPod, making it work with iTMS and licensing it to HP they are trying to build up network effects that make them the platform of choice. It's the same reason everyone chooses Microsoft Office; not because it is great, but because everyone else has it. Again I'm not conviced that the network effects here are the strongest, but if "everyone" buys iPods, that will make iTMS more attractive and vice versa. HP will undoubtable sell more so we might see people buying iPods and using iTMS because their family and friends use them. Not clear, but possible.
The other advantage of licensing to HP is they gain some economies of scale/scope. HP will sell more, making Apple's per-unit costs better, meaning they can fight low cost competition more effectively. The scariest opponent for Apple here is Microsoft because they can bundle with Windows and gain instant economies of scale and they have a much bigger war chest than Apple. If apple can sign up a few of the major OEMs (Dell, Toshiba, IBM, etc) to the same deal as HP, then Apple will be less vulnerable to Microsoft, though it would still be a problem.
In short, licensing iPods and iTMS makes a lot of sense. They don't need/want to do it for their computers because they are not easily duplicated and have significant strategic protection beyond simply the hardware and software. iPods and iTMS are much more vulnerable to competition and need to be treated as the different business it is.
I submitted a similar article earlier today, but I guess I didn't beat the person who posted this article. However, one point that I made in my submission, and that nobody has made here: Check the press release. Notice something? Apple is claiming that the "Allowance" feature of the iTunes Music Store is patent pending. This smacks of the One Click patent that Amazon.com secured. Obligatory call for prior art examples goes here. :-)
In addition to "Fair/Unfair", meta-mod needs a "Funny" option.
* Creative labor jobs outsourced, America left with pure labor or pure creative jobs.
And yet thanks to Bush's recent immigration policy shift, pure labor jobs will be handed over to a 'temporary workforce' culled from nearby foreign lands willing to do jobs 'Americans don't want' which should be read as 'Jobs that don't pay a living wage.'
Ugh. Corporate America gets bolder by the day.
-j
The part that almost never gets reported was that part of the deal was an "undisclosed" money transfer as an informal settlement for all the technologies that MS stole from Apple over the years, as well as an agreement that would allow MS to buy future Apple developments. (This has a lot to do with why XP looks so much like a Macintosh OS in some ways.)
What MS got out of it was an end to their legal wranglings with Apple, a weakening of the case that MS held a monopoly on computer operating systems, and the ability to legally use Apple as a sort of out-sourced R&D department.
The real winners in the deal were us. As consumers, we got to see systems from both Apple and the PC world get much, much better over the last three years.
Information wants to be anthropomorphized.
QuickTime. This is a huge win for QT preloaded on HP consumer computers as well.
This is a very good thing and ive been waiting for it to happen if you look at the aac license and the way apple worked it with the *AA its the least restrictive media out there. the problem has been that no other mp3 players can play it, this opens the door to dell, wall-mart and iriver to adopt the aac codecs into their systems. then if you want to use itunes, you can use your iriver, or wall-shit player or whatever, this is a very good thing, from what ive seen the wmp player is draconian at best. i would predict that in 1 year the aac codec will be on other mp3 players and maybe there will be one for linux.
if your gonna mod me down " fuck you very much, you pee-brained little shit, i got bad karma because the moderators are all on crack and they have the feelers of homosexual lesbians with an inferiority complex and a limp, i now consider bad karma to be a sign of intelligence."
By more international, do you mean by moving all Hp's operations overseas?
"He who laughs last, didn't get the joke."-Cap
- Money paid to record company (scales linearly w/ volume)
- Credit card transaction fees (varies, but semi-linear)
- Bandwidth (should get cheaper in bulk, but not a lot)
- Page design team (fixed cost)
- QA/Song Import team (fixed cost)
- iTunes development team (fixed cost)
- QuickTime development team (fixed cost)
- Equipment/maintenance (scales mostly by # songs avail.)
- Legal team (roughly fixed cost)
- Advertising (roughly fixed cost)
As you can see, there are a lot of very obvious fixed costs.Check out my sci-fi/humor trilogy at PatriotsBooks.
A couple of things: when the outsourced labor sucks (because of the reasons you state) that causes you to lose money / customers / reputation you stop doing it. For instance Dell. They just brought some of their call center work back to the states.
When I was forced into bankruptcy by the dot-com implosion, and couldn't find decent steady work for over a year, only to eventually find a job that required me to do more work for about a third of the money that I used to make, even a $99 iPod would have been too expensive.
Which means you were probably overpaid in the first place. That was one of the MAJOR problem of the dot.com boom: Labor squeeze, which begat wage inflation. Don't get me wrong, I enjoyed some nice paydays as well, but let me ask you this: Did you save anything you made during the boom? Did you rent/buy the best you could afford, buy/lease a phat ride? Did you have all the latest toys (PS, state of the art computer, PDA, the entire Think Geek catalogue)? Did you party every night like you were Prince?
Considering you went bankrupt, unless you owned a house who's value plummeted or had an uninsured medical catastrophe, I suspect it was due to some wicked credit card debt.
Sorry, but the gravy train never lasts forever, and the world doesn't own anyone shit. Just because the cricket partied his ass off doesn't mean he gets to eat the ant's grain.
I give this one year, max.
Out of curiosity, how long did you give the original iPod to survive? The one that came out two years ago amongst other mp3 players, mp3 players that worked with PCs, cheaper mp3 players, players that are not "those damn Apple products"? Did you plan on them becoming the dominant player or did you plan on them dying? I'll be honest...I wasn't that excited when they came out two years ago. But then I saw this as something big. When I finally saw the dominant numbers that the iPod commands in the market, I was truly impressed. So now Apple has the opportunity to expand that lead even more and edge out the competition. I take your bet and raise you a few years with a much larger market share owned by iPod devices.
"He uses statistics as a drunken man uses lampposts...for support rather than illumination." - Andrew Lang
Why do you doubt this? It's obvious to me that they would totally need this talent and it would be easy to acquire it. Think of how many out of business HD manufacturers there are in Silicon Valley. Plus, people move around between companies and get all sorts of experience.
I presently work for a company that makes data projectors. We don't make the lamps that go into them - we buy that part from someone else. Does that mean we don't have people who have the kind of engineering talent to design and engineer lamps? Of course we do! Otherwise, how would we be able to know which lamp to buy (ahead of time - anyone can recognize a disaster after it happens). We wouldn't know when they are feeding us a line of shit.
I'm sure they talk to this people on the phone, listen to their statements and ask intelligent questions. People with the right background know when to call bullshit on statements about whether something is possible or not, etc. Plus, they probably buy enough hard drives that they can call out requirements.
It is not that hard to hire someone with that kind of background and as an engineer who does work with hardware vendors I can easily see where that kind of expertise might be vital even if you are merely buying the hard drive from a vendor.
I used to work for another company where we needed a whole bunch of software folks who knew a lot about video cards. We were a small software company with no where near the budget that Apple has. Yet, we hired lots of people who had worked for NVidia, ATI, Matrox, etc. Some of these people had been senior engineers at those companies. It is not as hard as you think to get people with a needed skill.
What kind of experience do YOU have to be making that kind of statement anyway?
Avoid Missing Ball for High Score
I would be interested to read that article. Because, they way you described it, it doesn't describe why NeXT, Be, and even Apple have (relatively) failed in the marketplace, although they are all OS creators, too. The fact that you need Apple's OS to use Apple applications (such as Final Cut Pro) sure doesn't guarantee anything, if you prefer to use another application on another OS at the end of the da.
In fact, history proves this wrong: Apple had the OS, and MSFT had the Office suite for the Mac even before it was on Windows--so Apple should have been more successful, as they were "lower in the layer".
--
$tar -xvf
I can see the potential for Apple to almost virally distribute the iPod via HP, giving them a much much larger audience than they can ever hope to achieve on their own.
As most previous generation iPod owners will attest, they usually tend to upgrade with each new generation. If that trend continues with the HP user base then even better for Apple without diluting their branding so much.
Installing iTunes on my windows machine alone almost made me want to go and buy and iPod. It was a very simple and elegant interface, and I wondered why I'd tolerated various other programs for so long. Watching how my colleagues use their iPods as removable hard drives, media readers for their digital cameras, stereo for their cars, and of course as a walkman type device only makes me desire one even more.
If apple can pull such beautiful integration with other products (I'm thinking along the lines of cheap low spec and slim iMacs in a few key locations throughout the household serving as media hubs, using xGrid to share the load) then the iPod is a fantastic way of getting that foot in the door and making the customer believe there is a need for their other products.
Just a thought though
Glenn
The Smrt way to trade CFDs on the ASX
... is that more companies will be able to access the HP iPod through the wholesale channel, whereas Apple distributors keep a very tight leash on those who are able to purchase the products at wholesale. This potentially means that HP could down the track be outselling Apple purely because a much greater number of stores will have access to the HP iPod. Should be interesting.
That's not marketshare, that's percentage of new machines sold.
It's almost impossible to determine marketshare accurately. However, the service life for a Mac is, on average, thrice that of a PC - making attempts at calculating marketshare based on pure sales numbers a joke at best, and fraudulent at worst.
Despite the real gains it has made in OS improvements, Apple's cachet remains largely in its sexy, elite image. The schizophrenia that's marked its retail relationship with Target and other vendors - iPods for sale one day, then not, then back on again - points to the problems of dealing with the unexpected success of having a mass consumer hit on its hands.
And when is it ever a problem to dominate a mass consumer market? Well, it's a problem when you need to protect the refined sensibilities of your loyal base when at the same time you want to get a little, uh, action with consumers on the other side of the tracks. Put another way: how do you retain the people who don't shrink in horror at declarations that your product is "lickable" while reaching out to guys who dwell at Wal-Mart? They're mutually exclusive markets. You can't exactly make the ickyPod, now, can you? (Or can you? Look at the colors on those miniPods, jeezus!)
So this is Apple's challenge, then: continue selling iPods as avatars of youthful upmarket hipness, while growing the business by shifting product to another market segment via a ho-hum go-between. Enter HP with plenty of succesful experience in being ho-hum...
three words: NEVER, GONNA & HAPPEN.
Licensing OS X for x86, god, that just rekes of a bad idea. One of the first things Jobs did when he returned: killed the mac clones.
*Apple is a hardware company*, they make kickass software to sell kickass hardware (iLife sells iMacs, iTMS sells iPods...) They don't want to get rid of their BIGGEST MONEY MAKER by letting HP sell all the hardware on lowend boxes, and slapping macos on their... You can't keep the 'it just works' ideals of the mac that way, and Steve Jobs wouldn't allow it.
Apple has the #1 Video Editing App
Apple has the #1 DVD Creation App
Apple has one of the best high-end Compositing Apps
Apple has one of the best high-end Digital Audio Apps
The only other high profile content creation area they do not have a foothold in is 3D animation.
To me the logical next step would be to buy Maya.
Only problems with this are
1) There are already several good 3D apps for the OS.
2) SGI will only sell for a ridiculous amount
Most high end 3D animation is done on PCs & UNIX workstations. That won't change until Maya's high-end stuff is available for the Mac OS. Currently only their low end stuff is available for the Mac.
If Apple buys Maya, ports the good stuff and sells it cheaper for the Mac OS then we will see thousands of animators switch.
You can't boot a DOS/Windows type OS over firewire to a PC
How exactly is this Apple's fault? Don't you think you should point the finger at the OS designer?? Next you're going to blame Apple because you have to go into the BIOS to switch to a CD boot instead of just holding down the 'c' key right?
There are two types of people in the world: Those who crave closure
actually it seems to be that the real "trigger" for this is Dell's release of their MP3 player.
"the enemy of my enemy is my friend"
although some Mac people (what with Steve Jobs putting up the picture of Micheal Dell with the bulls-eye on his forehead at a Macworld a few years back) think that Dell is Apple's enemy, it doesnt by far compare to the war being fought between HP and Dell.
HP obviously found it better (and I agree) to align with the leader (in an ironic twist, since usually its Dell who is ahead).
This whole announcement isn't about "HP and Apple", it's about "HP vs Dell"
drats, hit submit too quick
what i wanted to say (which was why i replied in this thread) is that its obviously to HPs advantage to align with the leader now (and in exchange, have to offer wider iTunes distribution) than to invest who knows how much money churning out yet another MP3 player (the field is getting very crowded actually. don't forget the chinese manufacturers popping up, and the multi-function phones-and-mp3-players on the way, with the new super-small HDDs).
HP got burned many times before with "create our new product lines" (think "Jornada", with their colour bit-depth cockups and product recalls). much much safer this way.
and, best of all, this is a dell tactic - invest no R&D money and just slap your logo on someone else's product !
As others have pointed out, this goes beyond licensing -- Apple is going to manufacture the HP iPods as well. That means they can control HP's cost per unit. The only way for HP to "compete" and try to cut the price point out from under Apple is to cut their own throats.
Besides that, the iPod controls better than 30% of the mp3 player market (and 70% of the revenues) at its current price point. Does anyone out there think HP/Compaq wants to loose money to gain part of the mp3 player pie, or do you think they want to hitch their wagon to a device that not only leads the field, but sells with something like a 30% profit margin as well?
If those analyst-estimates of the profit margin on the iPod are accurate, you have to wonder just how much of that margin Apple is giving up to HP. For the $300 15GB iPod, that means Apple's cost is about $210. How generous would the deal have to be for HP to bite? Even if Apple split the profit margin down the middle (which seems mighty generous to me), that puts HP's cost per unit at $255. In addition, HP will have some costs (shipping, storage of inventory, marketing, etc.) that will likely be greater than Apple has (especially at the start of this deal), so add a little more to their cost (say $260). So, if Apple gave HP a sweetheart of a deal and HP wanted to make absolutely no money from the deal, then HP might be able to offer its iPod for a price low enough to grab customers.
But why would they want to do that, when the iPod sells like hotcakes at its current price point?
Seems to me that if HP is going to compete with anyone, it's with Dell ... and Apple is already doing that rather successfully. If HP follows Apple's lead on this, I'd wager they'll grab more customers from Dell than they would from Apple, and I doubt they'd have to drop the price of the HP iPod to do so.
This is touched on a bit here, but not enough...
The big gain for Apple is QuickTime. Apple once had a deal with Compaq to include QT on every Compaq shipped. This was back in the days when MSFT played dirty (I guess I should say dirtier) Anyway, MSFT scuttled that deal.
This is a HUGE win for Apple. As has been said many times by many pundits, Apple was going to lose EVENTUALLY if they did not support WMA on the iPods or start supporting WMA in the music store. It was only a matter of time.
This move, however, gives MPEG4/QT/AAC legitimacy, and creates an installed base for these [more] open standards than the proprietary WM formats. Especially with HP being one of the first companies to come out with a Media Center PC (I think Gateway was the first). HP has traditionally been MSFTs showcase company for new technology, like the concept computer last year. Now HP may be saying, if we are creating a media center type machine we want to develop it around OPEN standards, not ones where we pay MSFT at every stage of the game.
All of a sudden, AAC, FairPlay, MPEG4, etc., all look like they could succeed in the industry - hell, even win. You never know. But no longer can you look at AAC and QuickTime and say that it is only a matter of time.
It surprises me (hell - it really doesn't) how the pundits have missed this. This is NOT about the iPod. This is NOT about the Apple Music Store. This is ALL about the competing media standards and what this means for QT and the MPEG alliance going forward. This IS huge.
Eytan
--
Q: How do you convert ordinary water into Holy Water?
A: You boil the hell out of it.