Is iPod the Razor or the Blade?

Kelly McNeill writes "Robert Cringely has another update to his 'I, Cringely' series. In this piece, Cringely analyzes the business model of the iPod and how it compares it to the age old, marketing 101 'give away the razor and make money on the blades' business model. In his editorial, he demonstrates that Apple one-upped Gillette by making money on both blades and razors. The article is structured in a back and forth dialog with one of his readers who provides a very interesting analysis of the direction that Apple will be going with its rumored movie download store and how it relates to the Mac mini. On the same note, osViews has an editorial about Apple's direction in the movie download business as well, which suggests that there is evidence to suggest that Apple will use satellite networks for its Movie download store."

Comments

Re:Another editorial, slightly different perspecti

[Anonymous Coward]

Why,hello there blatant self-advertisement. What a coincidence that your username on here happens to exactly match the author of your little article

Re:A Better Analogy: iPod=Messenger Bag

[Anonymous Coward]

Wrong. The converse of a statement is not necessarily true, whereas the contrapositive is always true. In this case, "you are cool if you have an iPod" is the same as "you don't have an iPod if you're not cool", but not necessarily the same as "you aren't cool if you don't have an iPod".

The Coolness Factor of iPod

[Nom du Keyboard]

The coolness factor of iPod is that it makes the statement:

I bought my music! I support the artists!

It may not be true. And given the average of 5 songs/iPod purchased so far (although that number may be questionable since it assumes all iPods bought are still in use -- which we know, due to battery problems, isn't true) probably isn't likely in nearly every case.

Regardless of that however, I could be actually paying for my music now that I have an iPod, and no one else can gainsay me on it. No other player says that clearly.

That's coolness!

Not a good analogy

[Mephiska]

For Gillette, you can only buy your "Super Mach3 Turbo EX XL Extra Elite" blades from them (for now).

With the iPod, you can make your own MP3's, download them from other sites, whatever. Other audio formats play on the device, so their iTunes store isn't your only source of content for the device. Thus they need to profit off it.

Netflix doesn't purchase DVDs

[jmichaelg]

Once Netflix has purchased a DVD, assuming it does so at full price outside of a special contract it enters, it is allowed to rent/loan that DVD out an infinite number of times.

Netflix doesn't buy the DVDs. It pays for them by using a revenue sharing agreement with the studios. From their site

We are extremely pleased that the major studios recognize NetFlix as an important distribution channel for their content," said Reed Hastings, co-founder and chief executive officer of NetFlix. "With these revenue sharing deals we can continue to deliver on our promise to provide the best movie experience possible -- giving our customers the titles they want, when they want them, and allowing them to enjoy the movies for as long as they like. The agreements also help us keep pace with our extraordinary growth, without compromising our quality of service."

Re:A Better Analogy: iPod=Messenger Bag

[Queer Boy]

oes it take Lithium Ion batteries or Double D?

I've never met a 19 yo sorority sister that would need a device that used DD batteries unless she planned on using it on her boy du jour.