Tag Archives: Apple

Rebirth of the newspaper?

Rupert “I bought MySpace just in time for it to tank” Murdoch didn’t seem to get the new media thing… until today. The Daily, the first iPad-only newspaper launched to great fanfare. At first blush Steve Jobs and Rupert Murdoch make Felix and Oscar look like identical twins, but they certainly have at least one thing in common. They know how to passionately engage millions of people at a time and make a lot of money doing so.

If the Web has been listed as the cause of death for numerous dailies and magazines, the App might be named godfather of the reborn e-pubs. While people remain largely unwilling to pay for content on viewed on the PC, the iPad and Kindle prove they are willing to pay for content on the tablet. I call it the corn flakes effect. I always paid a few bucks a week to read the morning paper at the breakfast table. I’d pay a few more bucks a month for magazines to read in bed. And I’d overpay at the airport for virtually anything to read on an airplane so I wouldn’t be stuck watching some neutered cut down version of a movie that tanked at the box office.

CNN covered the announcement nicely, acknowledging that as the iPad’s share of eyeball expanded into television’s territory.

Another report last month from ReadItLater, a web service that follows web trends, found that the time spent reading on the iPad is even crossing into primetime TV hours.

It reported that maximum iPad text consumption occurs from 7pm to 11pm, a slot traditionally allocated to reclining on the couch and watching TV.

Likely CNN is assuming it’s at the expense of Two and a Half Men, not Anderson Cooper. Even the Times gushed about the Daily’s user experience… in its own catty way.

The Daily, according to people who have seen it, is aesthetically — if not intellectually — compelling, incorporating sound, sight and motion in new ways.

“It’s got an amazing look and feel,” said Mike Vorhaus, the president of the media consulting firm Magid Advisors, who had been shown The Daily in advance and who compared it to a glossy magazine.

Of course CNN was able to dig up the requisite Luddite for its coverage.

“While anything that Rupert Murdoch and Steve Jobs do in collaboration is bound to be unique, we have to be mindful of the fact that the tablet is just in its infancy stage — it’s like the early days of the printed press,” said Barry McIlheney, chief executive of the UK based Professional Publishers Association.

He believes that newspapers are easy to replace because their format is adaptable to the screen but reading longer passages of texts with images are not.

Apparently Mr. McIlheney hasn’t yet caught the Economist on the iPad. The experience of reading it on the iPad is more pleasant than on paper, and all the additional online content is only a click or two away.

Before we start encouraging kids to enroll in journalism school again, we should temper our optimism for the future of the old fish wrapper. Just this week Apple announced it’s clamping down on content sellers who evade the App Store and Apple’s 30% vig. This whole thing could lose steam quickly If Apple and the content creators can’t arrive at a win-win. The iPod always worked with non-iTunes content, in a competing format no less. If Apple blocks Amazon, Sony, Conde Nast, and others from getting their content onto the iPad, the whole platform will suffer.

What does number one really mean?

Earlier this week, Apple’s market capitalization topped Microsoft’s. From a bragging rights point of view it just doesn’t get any better than this for Steve Jobs and Apple. Even the staid gray lady, the New York Times laid it on thick.

This changing of the guard caps one of the most stunning turnarounds in business history for Apple, which had been given up for dead only a decade earlier, and its co-founder and visionary chief executive, Steven P. Jobs.

Of course, market capitalization represents Wall Street’s take on which company is more valuable. And it can be argued that neither company is worth nearly $220 billion. Remember the free market is only accurate over the long haul. The less accurate it is over time, the longer the long haul gets as defined by the experts. It’s the closest we have come as a society to perfecting the perpetual motion machine. The less accurate analysts and forecasters are, the more they are able to convince us of their importance. But I digress and would be remiss if I failed to note that the contrarians have come out in droves. A sampling from MarketWatch:

But how many times in a row can Apple pull yet another rabbit out of its hat? When a company is riding a wave of investor euphoria, its stock price already reflects the expectation of many more rabbits. Almost by definition, any unexpected developments from such companies will be bad news.

Stock talk is of virtually no interest to me. I could claim the high road as an adherent of the Random Walk hypothesis, but I’m not. Call me a proponent of the Random Mugging theory – walk down Wall Street enough times, and some punk out of Wharton will find a way into your wallet.

The last time Apple was number one

At the dawn of the personal computer era, Apple was the undisputed leader. IBM wasn’t much of a player but wanted in. IBM embraced MS-DOS and its more open ecosystem. Apple kept its platform mostly closed, and the rest is history.

Pretty much the same thing is happening now in the mobile space. Apple’s keeping its iPhone platform closed. Google’s entered the space with its open Android platform. I’m not deaf to the argument that times have changed. In an age of virus and malware attacks, privacy threats, and rampant generalized paranoia, the market may very well reward a closed and apparently safer platform. Steve Job’s bizarre promise of “freedom from porn” might play well in Peoria, assuming one can get an AT&T signal in Peoria. But we can take it a step further and put forth the proposition that the iPhone also gives us freedom from Verizon, Sprint, and T-mobile.

It really does look like 30 years ago all over again, but looks are deceiving. Only a fool underestimates Steve Job’s adaptability. Do not forget that the man who made it job #1 to kill the Newton upon his return to Apple is the man who brought us the iPad.

Excuse me if I opt not to place a wager on this race.

Apple TV’s next moves?

Before the Christmas holiday, rumors of Apple’s overtures to the networks abounded like so many visions of sugar plums. Journalists and bloggers posited about the effect of Apple’s entrance into the subscription television market. Most of the analysis was solid. The Seeking Alpha blog featured this succinct write up. Most expect a successful Apple offering would threaten cable and satellite subscription models. Others note that an invigorated Apple TV could put the pinch on the Netflix Roku service. Light Reading’s Cable Digital News noted the following.

While cable operators likely won’t face an immediate threat from the subscription service Apple Inc. (Nasdaq: AAPL) is purportedly pitching to major content suppliers, the offering may instead put the hurt on over-the-top video service providers like Boxee and Roku Inc.

It should be noted that Apple TV employs a hard disk. Content is downloaded before it’s played. Roku receives streams, so it’s a lower cost, lower footprint device. Most importantly streaming allows more delivery flexibility. Netflix doesn’t care whether I watch my content on a PC or a TV. Apple TV is anchored to a television. While an iTunes account can be managed from multiple devices, content needs to be downloaded to each to play it. Even with improved progressive download performance, this model has its limitations. One blog noted that a full season of an HD network television series can take up to 50 GB of hard disk space. So there’s a limit to how much content can be delivered to an Apple TV.

For Apple to leverage the strong iTunes brand it has to unhitch content from the device – a fundamental change in business model for a device manufacturer. But if any company has shown the ability to adapt to the digital media marketplace of the early 21st century, it’s Apple. If Apple succeeds at getting content deals in place, I expect a next-generation Apple TV to emerge shortly thereafter.

Apple, iTunes, and the cloud

A small, but interesting tidbit. Word has leaked that Apple has agreed to acquire the hybrid streaming-download music service Lala. Unlike other streaming services, Lala is not subscription-based so it fits nicely into Steve Job’s view of the online music world. Lala is more of a cloud-based iTunes. If you keep your music on the cloud and stream it, you pay 10 cents to add it to your collection. Downloading a song costs 89 cents. Lala also has a nifty technology that allows the user to upload his MP3 library to Lala. Any song in Lala’s catalog is linked to the Lala version, others the user can upload for free.

Assuming a proliferation of music playing devices with inexpensive Internet connectivity, the deal’s a no-brainer. It accelerates iTunes’ much needed migration to the cloud. You gotta love this business model from the consumer’s point of view. “Let me get this straight, you’ll store, backup, and manage my music collection on your storage with your infrastructure for 10 cents per song, or I can take on the hassle for 89 cents per song.” Apparently the model works according to a Wired article.

This Lala acquisition could also help iTunes increase its revenue-per-user. Steve Jobs admitted  in 2007 that the average iTunes user had only bought an average of 22 songs. By contrast, Lala CEO Bill Nguyen told us in October that its paying customers spend an average of $67 on Lala music…

And don’t forget all of those wi-fi capable iPods to be sold.

Where Cisco wants to take video

Flip MinoHDCisco’s acquisition of Pure Digital, makers of the Flip video cameras came as little surprise to the digerati. What Linksys was to wireless home networking, the Flip is to consumer video. Good enough, simple, and inexpensive.

Cisco made its name as a big iron networking powerhouse. With its heavily publicized purchase of Linksys the company bought its way into home networking. And with its less heavily publicized acquisition of set top box maker Scientific Atlanta, Cisco gained control of another digital gateway into the home.

So why would a networking company want into the acquisition business? GigaOm has written extensively on the purchase – the reasoning behind it and whether Cisco overspent.

Cisco is just the company to make video accessible to all. Every household has at least one camcorder. Mostly it sits idle. Acquiring the video is easy enough – hit record just as granny is about to blow out the candles or the cat is about to flush the toilet. The moment can now live forever on tape, disk, or flash media. Therein lies the problem. It’s cumbersome to do anything with it after the material has been recorded. Cuing up the media to show to family and friends around the flat panel is a pain in the neck. Editing and distributing the video online is a similar pain, just head south 36 inches.

The Flip camera solves half the problem. With its USB port, the camera can attach itself to any Mac or PC. Now comes the scary part for a guy who makes his living designing editing software… The Flip camera comes preloaded with all the editing software the consumer needs. Plug the camera into the computer, and it prompts the user to install all the necessary software to edit and publish his video online. The FlipShare software doesn’t compare to Pinnacle Studio or iMovie, but it doesn’t have to. It’s so easy that people will actually use it.

Cisco has the capability to solve the rest of the problem. As GigaOm noted, it can eliminate the computer. Shoot, push to the cloud, and edit on the cloud. No Macs. No PCs. What Polaroid did for photography 50-some years ago, Cisco can do for videography. It can make it instant, inexpensive, and fun.

Cameras preloaded with editing software will be a minor disruption to business as usual. Editing on the cloud is where this is all going, and the industry will be turned on its head.

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