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Gates v. Jobs, continued...
FJCsar writes "The New York Times has an interesting story about the continuing battle between Microsoft's Windows Media Player and Apple's iTunes from the perspectives of both Bill Gates and Steve Jobs."
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What a difference the two companies (Apple and Microsoft) have in terms of public perception. Microsoft is seen as a necessary evil. Apple has always been seen as "pretty" and "innovative". The one fact that really drives that (and a few other things) home though in this article was this beautiful quote:
Speaking just after the event, Bono, U2's lead singer, said the band was not charging Apple a penny to be in the ad. (The band says it had turned down as much as $23 million to use its music in other commercials.) In its three-year life, the iPod has achieved such "iconic value," Bono said, that U2 gets as much value as Apple does from the commercial, by promoting its music and the new Red and Black U2 edition of the iPod, for which the band gets royalties.
It's just another example of how Jobs has his pulse on the entertainment industry (ie, Pixar, iTunes being THE music service to break through, etc). Microsoft on the other hand is relying on OS marketshare dominance to try to get into the game.
"He uses statistics as a drunken man uses lampposts...for support rather than illumination." - Andrew Lang
The Microsoft vs. Apple battle in music players is bigger than the two computer software giants.
The last half of the 1990s demonstrated two things:
1. People want to listen to music in a digital format
2. The Internet is a viable digital music distribution "medium".
Until the online purchase/subscription model battle is won, the battle over music players isn't going to be over anytime soon.
Although I think the subscription model might win out in the end, there's something to be said about owning the music you purchase.
Personally, I don't want another monthly bill. I have enough of those, plus student loans. I want to buy a song online like I buy a CD in a store and be done with it and not be worried about subscription fees.
Whether or not you use Windows Media's DRM or FairPlay, it's clear that you'll eventually need to upgrade (purchase) newer versions of the OS to continue to play your music, whether if it's subscribed (borrowed) or owned outright (iTMS).
Maybe I'll just stick with transcoding everything to MP3s that play just fine everywhere, including my iPod.
Up, Up, Down, Down, Left, Right, Left, Right, B, A, START
"Over time, proprietary standards always lose because industry standards always win because you get more for less," said Michael A. George, the general manager of Dell's consumer business. Dell has just introduced a 5-gigabyte music player, using the Windows standard...
I wonder if any of the general public will realise what contradictory behaviour this is?
"Proprietary standards always lose, so that's why our media player uses a proprietary standard (WMA) and the iPod uses an open format (AAC)".
(Mp3 has delibarately been left out of the above sarcastic statement, due to its obvious ubiquity).
not really,
it is simply giving away its own music standard and letting everyone make players for it. It is is betting that no matter how pretty an apple Ipod is, when people see equivalent stuff for 50 adn 100 dollars cheaper, they will start to turn. And you know, I think apple will again lose out because it is being a damn fool trying to lock everyone into its file type and hardware.
But this has always been apple's way, make money on hardware. Right now Ipods are the in thing, so they are riding a huge wave of sales. I know people who needed a reality check before buying them so they didn't waste their money on an overpriced music player. And slowly I can see them losing out as more people want to save that 50 dollars when there are no quality differences.
Of course, then we will hear whining about how Microsoft crushed the innovative apple again, even though it was just apple charging too much well into a time when the market wouldn't support it. Yes, apple is the real innovator, but you know what, I don't care when they try and charge me out the ass. I buy the cheapest product that does the job, and so do a lot of people.
this quote sums up why apple has so much trouble winning: "The iPod cannot play songs from most other stores, and Apple's iTunes store won't sell songs for other players". I you don't make things work together, you end up being the lone man out. Slowly the other music stores will begin to gain customers, and then they will want a music player. And then apple loses, because its Ipod, which is what everyone wants, can't play those songs. Suddenly people see options, and apple's little monopoly begins to fall apart.
That would be roughly the same 90% customer group currently using Wintel/IE systems, right?
"They won't encourage informed consumers, however they might annoy them."
That would be the remaining 10%, using open source software & reading /.
Uninformed maybe, insignificant? NO. Most consumers don't care about details, just take what is presented to them. Give'm a PC with Windows pre-installed on it, they'll use it. Give'm Firefox and lable it "internet", they'll use it. Give'm an iPod with U2 songs on it, they'll love it.
If you didn't RTFA, please do so. It's worth it.
.99/9.99 model or the subscription ideas which (some) people either love or (mostly) hate
I found many quotes interesting including this:
Mr. Jobs rejects the comparison between the music players and computers. The Macintosh had an uphill battle, Apple says, because so many corporate customers already had applications based on Microsoft's operating system that they didn't want to abandon. By contrast, Apple's iTunes Music Store sells pretty much the same songs that the others do, but they cannot be moved onto non-Apple portable devices.
This is the glory of the iPod/iTunes combo.
Basic marketing speaks of product differentiation and competitive advantage as keys to sales growth. In all the on-line music stores, the differentiations are:
(1) price for which there is either a
(2) catalog which is by and large the same (at least for mainstream current music the labels want to sell) with some larger stores securing exclusives and international market access.
(3) format of encoding which directly dictates which devices the store works with.
Apple is so damn smart because they set (1) so low there is no margin in it for companies that just sell music only to compete, (2) is so big and robust that at best a competitor has the same catalog and at worst, a smaller one, and (3) locks all the Windows Media Format people into a "push" for product differentiation. This forces them to look at (1) or (2) and since their small market share will prevent (2) from getting exclusives that really means (1) is the only way to go. But as mentioned before, margins are too darn low so no matter how you slice it, they can't compete on price alone.
Which brings us back to that quote by Jobs above. If you start buying from iTMS, which 70% of the market has, it costs MORE to switch because you have comitted yourself to (3), the format, and you have to giveup all your music, and all those 0.99 that added up, to move.
Brilliant he is, just brilliant.
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
A U2 iPod containing all the music the band has ever produced is a great idea, because it's like releasing an album, but using a much more advanced media storage medium. But what's the point of having Queen Latifah at the Microsoft launch?
Years ago, I bought some CDs at BestBuy for $1.99 each. They were made by Pilz, a German company, with classic music played by Eastern European orchestras. Which shows the true cost of producing music when the RIAA is left out and the copyright for the author has expired. Why pay $1 for a Mariah Carey song when you can pay $0.12 for a J.S.Bach song?
"I think apple will again lose out because it is being a damn fool trying to lock everyone into its file type and hardware."
well, maybe i don't want to be locked into Microsoft's format either.
"And slowly I can see them losing out as more people want to save that 50 dollars when there are no quality differences."
Take a walk around nyc or any city for that matter. you can't throw a stick without hitting an ipod owner. i don't think it's a style-statement either, people are just sick of dealing with buggy virus-laden software and bad design. it doesn't help that MS are everything bad about big business in this country as well.
"apple is the real innovator, but you know what, I don't care when they try and charge me out the ass. I buy the cheapest product that does the job, and so do a lot of people."
and this is the attitude that is creating a third-world economy in the US and shaping much of our foreign policy; "I don't care if something is made well, i just want it cheap and in bulk so i can stuff more crap into my life."
As much as u may deny the Jobs mind-warp marketing slogans, he is dead on the money when he says (compared to the rest of the market) they make "insanely great" products. And what makes them great is not just the hardware design, but software design.
For years and years, years back, I enjoyed the x86 cuz of the way the Mac hid everything. If you wanted to upgrade, well, good luck with the OS and the parts were an arm and a leg. But that was then. Now, it's all about portability for me and that only means one thing: a laptop. For the past 4 years the laptop has been king with me and thusly, since I usually get them maxed out, there is no upgrades. Coupled with an OS that, while not perfect and sometimes a bit more sluggish than Linux, I have a machine that just runs. I do my development exclusively on that and it goes with me everywhere. My 1st gen iPod still works great too (when does 1st gen anything work anymore???). True, many people have had probs with the battery, but I still have the stock everything on it and it's still very useful. Much more so than my previous MD players. As for Apple'ss DRM, it's easily circumvented and Apple's service of 'get out of my face and gimmie my song' does just that. Period.
In a world where it seems the only way for corps to go is to try to own everything (which is not sustainable in the long run, but of course, corps are never really concerned with the long run), Apple was marginalized (somewhat) and forced to do things differently than the Dells and M$s of the world - of which there are only a few now.
Look back at the last 5 or so years and you'll see the PC industry's knee-jerk reaction to quite a bit of Apple 'innovations' (I think that term is pretty silly and over used, but whatever):
- 17" laptops
- Wi-fi for the home/soho (and recently, AirTunes)
- Lcd desktop displays
- dvd-burners on desktop as well as laptop
- iMac colored cases (yes, pc manufacturers tried to jump on this)
- iPod
- iTunes
- Encrypted home dir on the fly (heh!)
- Rendezvous
- Firewire
- Gigabit ethernet in laptops
- backlit laptop kbds & screens that adjust to room brightness automatically
Now when has any of the above come out of M$ or Dell or Hp/Compaq?
Like so many other aspects of life, I feel that the diluted, lesser quality - not in terms of design or manufacturing, but in terms also of idea conception - cannot be sustained at critical mass levels. So you get a Dell plastic laptop that is 'good enough' but feels like, well, the cheap plastic it is. Or you get a M$ XP OS riddled with security holes throught the core of the OS, but has the widest appeal and ubiquity.
Big organizations are a slow moving giant. They like to put on a pretty face to attract cutting-edge talent, but in the end, they pound that talent into the ground and the result is sorta like the Apple 1984 commerical. Sure, there are definitely smart and creative people at big companies, but I have to say most of the creative people I've met and worked with don't survive long in the corporate environment. And most of the time the creative folks take a back seat to the suits. I say this cuz when you look at the Queen Latifa & Billy G pic, you can just see that moment where she rattles off somethin, throws in a little slang, and then Billy pops in afterword with some canned Windows-media-can-do-everything-u-want-and-more-in -your-cab-and-home remark (chuckle from the audience). The suit. Jobs, on the other hand, while I don't think he's some perfect guy, has much more 'entertainment finesse' than Bill or Ballmer. When you have these fundamental elements of getting it at the highest levels of an org, then it makes it much easier to those lower creative types on the pole to gel with those above. Why? Cuz like minds think alike.
So, when you take all of Apple's successes over the past we can say they've been possible because some creative and smart people had some wiggle room to take c
If for instance we see the emergence of speciality shops, like everything Jazz, everything Classical, stuff like that, if the collection is not matched by iTMS and if the format sold is WMA.
Then I could imagine being pissed off by using an iPod. Now we have like ten shops selling the same stuff, and the Apple store is both the biggest and the nicest one around.
At the moment I'd be pissed off by using anything but iPod.
Disclaimer: I don't use any mp3 player, I do use iTunes, it's really nice in everything it does, imo. Which incidentally makes it an almost 100% certainty that if I buy an mp3 player, it'll be an iPod.
I think, therefore I am...I think.
You know, you really don't even need something that complicated to get really good sound. I'd be happy if I could find a car stereo that just had a phono jack in the front - then I can use ANY player.
You know, it's not an illegal monopoly until one use said monopoly to gain in other product areas. The quote is typical "the enemy of my enemy is my friend" politics, and while Rio are happy now, I know that they have a bad feeling about this. Microsoft does not help anyone unless they think they have huge profits to gain from it. AIDS victims included.
I am not going to buy a peice of hardware or software just because it has been endorsed by some obscure celeberties I have never heard of... They won't encourage informed consumers, however they might annoy them.
I'm afraid that if you haven't heard of U2 or Queen Latifah (love 'em or hate 'em), then you hardly qualify as an 'informed customer'. And they definitely aren't marketing to you.
Yeah, not only that, but Microsoft was far from tiny and unknown at the time. Jobs just mistakenly thought that Gates was his pal. Gates' only pals are money and power.
Ask Slashdot: Where bad ideas meet poor googling skills.
Is anyone else annoyed that the NYTimes lets the Dell guy get away with calling it a battle against proprietary software. Let's face it, both Apple and Microsofts DRM is proprietary.
Ok, I live in canada, and so far we have been without the iTunes music store. And who needs it! I already had over 1000 cds to rip when i first downloaded iTunes. So i ripped the cds, stuck them in an envelope, tossed out the jewel case and have never touched them again. If i want a new cd i buy it... that way i can rip it at a higher quality than the itunes store would ever do. New cds are still pretty cheap.
The iPod is always going to win this one. People just need to embrace a CD free life totally digital lifestyle. Rip your discs and store them, dont touch 'em again! Use your ipod in your car, on your home stereo, on a boombox. Who cares about burning cds... they're so '90s.
that this article gets placed under the APPLE section as opposed the MICROSOFT section!!!
Im gonna cry..
The richest men in the world, who got their money semi-legally, almost always turn into philanthropists as they get older. It's a psychological need of theirs, so that they don't feel 100% evil for what they've done in their lives.
BG is not the first to throw huge amounts of money around. A hundred years ago, it was the steel magnates. There have been other industries since, but it's IT's turn to give back what it illegitimately gained.
There's a name for this: the guilt culture.
Put identity in the browser.
Steve Jobs can wipe the floor with Gates if he wants to. It's not even funny to compare them. If Apple had half the money Microsoft has, they would kick MS out of the market easily.
Apple and Microsoft seem to have two distinct stratagies. Microsoft uses thier brute force to buy competitors out, or force them out of buisness. Apple relies more on making inovative products. Of course there are exeptions on both sides. But personally I think that Apple's approach is better for the consumer, and better morally (if there is such a thing in modern buisness).
Translation: pay off every bastard and his brother until you have made the hardware and distribution ends of the music business your vassals.
The president of Rio explains how the hardware sector is being colonized: "Microsoft made it worth our while to get them into our box...They bring a whole suite of service to us, marketing, help with testing and engineering support."
And at the distribution end, there is more bliss: "I never would have believed I would say this, but Microsoft has been easy to work with," said Ted Cohen, a senior vice president at EMI Recorded Music.
That stuff will scare Apple, which has had to cajole and bug the music biz to get what it wants. Because this is the key: the battle between Microsoft and Apple won't be fought at the consumer level--that's merely where the proles await the outcome. The real battle is being fought by the Microsoft treasury as it gradually puts everyone on the payroll. As with so much else to which it has applied its monopoly power and wealth, Microsoft will buy this market, too. Once it has blocked and barred and obfuscated and outspent Apple, the good free market ideologues will be along to lecture us again on how consumer "choice" has tamed yet another frontier.
1) This time around Apple is the market leader. Apple was always behind IBM and the PC market share. 2) Apple has allies this time. It's not IBM and MS vs Apple. Its Apple and HP and the music companies vs MS and Dell and the music companies.
On a side note, the one thing that bothered me about the article which shows how unresearched it was is how it portrays Apple as not willing to play with others when that isn't the case.
1) For the last time, AAC is not proprietary but Fairplay is. Meaning the music you buy from iTunes may be locked, but anything a consumer rips and encodes is not locked.
2) Windows Media formats are just as proprietary. Real player formata are also proprietary. MS and Real have no justifiable argument here. I don't see them opening their format to allow Mac/Linux owners onto their sites, yet they complain that iPods and iTunes shut them out.
3) Almost all portable media players play MP3s.
Well, there's spam egg sausage and spam, that's not got much spam in it.
Besides, cable companies are already moving into this market with video on demand. I think it's going to be at least two years before something like the iMovie video store becomes even feasible.
First of all--and this is the most important--Apple partnered with MS back then. That's how MS did its famous reverse-engineering to steal a lot of the Mac "look and feel" (which Apple hadn't protected in any substantial way--i.e., patents, etc.) There is no partnership this time around. It's quite telling to see who is begging for the partnership (MS) and who is wisely refusing it (Apple.) You don't make a deal with the devil, especially if you already did it once before.
Second, Apple isn't just sitting around this time, hoping that the brilliance and beauty of their products will win the day. It's clear they've learned to keep pushing the boundaries. The iPod has only been around for --what?--two years now and look how many revisions and product variations Apple has produced. Look how many promotions Apple has done. Look how they've built iTunes into the best cross-platform music player and store. Look how they've partnered with Pepsi, HP and a wide range of retailers I just spotted the iPod Mini in a Costco ad. They're not treating the iPod like an exclusive island resort like they did with the Mac. It's come one, come all.
Third, they are reshaping the culture and technology of the Mac to support the iPod (and vice-versa), music and the whole "digital lifestyle" thing. OS X, QuickTime, Core Audio, GarageBand. It's totally embedded into what they're doing. Remember that the Mac was, for a surprisingly long time during and after its conception, treated like an aberration and wasn't fully supported by Apple at first.
Fourth, it's NOT PROPRIETARY. The iPod doesn't just play iTunes downloads. The Mac was bogged down for the first half of its existence with too many proprietary aspects.
Fifth, incompatible software. Remember how the Mac's big "weakness" was that it wasn't DOS-compatible and later Windows-compatible? Extend the analogy. The "software" in this situation is music and the iPod is fully compatible with the rest of the world here. There is no software gap to close.
I appreciate that the writer is trying to get a sense of the current situation, but I think comparing it to the Mac's rough history is shortsighted.
--Rick "If it isn't broken, take it apart and find out why."