Reading the Apple tea-leaves

Apple launched a range of new variants on their existing product range. The design decisions that Apple made on some of the products were very curious and I wondered what that said about the wider technology sector. The products that Apple launched were:

iTunes 10

First off there was a lot of fuss around iTunes 10 and Ping which was seen to be a challenger for Facebook and services for last.fm. I thought Ping was interesting because it was a good example of social commerce a la services like mFlow or even recommendations and reviews on Amazon if you use Ping in its most public mode.

I personally won’t be cancelling my last.fm account any time soon, partly because I have so much data invested in it already, according to to the site I have scrobbled some 28,164 track details as I write this blog post.  Last.fm has provided me with better recommendations than iTunes Genius usually does. Lastly, Ping only takes account of music and iOS applications that you have bought from the iTunes Music Store – lets be realistic you are not likely to review any content there that you have bought on CD just for the hell of it.

Part of the reason for this is that iTunes does a really good job at the head of music but fails on the tail, this is going to be particularly true for people if they purchase some of their music different countries iTunes stores (I get my Japanese iTunes credits from J-List), from the likes of Beatport and Bleep music stores or direct from the artists.

Where this leaves Facebook is another matter. On the one hand there is only a small amount of my Facebook friends that I would discuss music with partly because their tastes are divergent from my own or because the context that we are friends in doesn’t really encompass music. On the other hand it challenges the notion of Facebook as a general purpose social network. Whilst specialist networks like last.fm attract a comparatively small audience compared to Facebook, no one has launched one on this scale. As far as I know LinkedIn has been around since before Facebook. So from this perspective it seeds doubt on the iron grip of the Facebook eco-system. Where that leaves Facebook’s space programme-esque market valuation is for anyone’s guess.

iPod Shuffle

The Shuffle was notable for going back in time on its design and returning to the familar shuffle buttons rather than having the in-headphone controller. At the time of the launch of the previous design these headphones were criticised by pundits due to the locked in nature of the device to the headphones. I can’t remember seeing anyone with the old Shuffle so it looks like market forces kicked in.  I found it fascinating that Moore’s Law hasn’t driven the memory capacity of this device up, more on this later.

iPod Nano

The latest iteration of the iPod Nano had people marveling at the size of the device. It is almost Shuffle-esque with a back clip and a square face. The device uses a touch interface like a cutdown version of the iPod Touch | iPhone. What I found more interesting was what was taken away from the device. The screen is no longer really suitable to play video, and the camera has been removed. The previous version of the Nano had become a viable competitor to the Flip series of cameras and similar devices like Sony’s Bloggie, ideal to put video on to YouTube. In order to do that now, Apple wants to upsell you to the iPod Touch or iPhone. This could partly down to providing clear differentiation on the Apple video offering focusing on Facetime rather than content creation.

The line is being blurred between the Nano and the Shuffle in terms of form-factor: I would expect one of the devices to be dropped on Apple’s next refresh of the iPod line.

iPod Touch

Apple continues to have a RAZR-like obsession with thinness in product design without regard to how the product feels in the customers hand. Feature-wise the upgrade to allow the iPod Touch to use Facetime made sense, since this feature only is supposed to operate over wi-fi anyway.

What I found more interesting was what was lacking in the device. It was obvious from the presentation that the iPod Touch line was designed to be an upgrade path for iPod Classic customers as well as this line seems to be getting phased out by Apple, but there was not a corresponding high-capacity device. In fact none of the iPod range got a memory upgrade.

This seems to support the hypothesis recently put forward by iSuppli that solid-state mass memory is still too expensive despite the continuing declining price of NAND modules. This in sharp contrast to the position held by Kingston Technology. If you think of an iPod Touch as a fancy SSD (solid-state drive) then this makes a lot of sense. It may also be a small but contributing factor to why the Apple TV has gone to a streaming rather than side-loaded approach to media.

Apple TV

The Apple TV was full of interesting design choices.  If we think about the product design of the Apple TV, it is a device that is designed to be invisible in the sitting room. It can hide sat on top of the Blu-Ray player or the home cinema system. Apple took out the hard drive so it wouldn’t be heard: no fans, no rotating disks – none of the faux pas that have seen the IT industry banned from the home entertainment set up. There is no mag-safe socket on the back of it, you set it up and forget it. Instead it uses the kind of power cable connector you find on the back of stereo separates and games consoles, like as if it was a conscious decision saying that the device belongs in the living room even that that level of detail.

Where I think that the device may fall down is in its streaming of content. In the UK, the broadband infrastructure simply isn’t available to support existing streaming video services. I live in Central London within the proverbial stones throw from Silicon Roundabout and get barely 3MBs download and 400KBs upload from my ADSL connection. I live 500 metres from my local exchange. At the moment HD content streaming from BBC iPlayer is unwatchable.

This where I think that the experience of Apple TV is most likely to fall over, Apple TV’s theoretical vision of the cloud doesn’t match the reality.  High-speed broadband network coverage is like Swiss cheese. Early adopters like me (and there are a lot of us in the neighbourhood judging by the amount of coders with Mac laptops I see in my local coffee shop and the post-grad students renting on my road) will complain about the device to lots of people. We’ll blog about our experiences, so at the moment I still think that the Apple TV is to meet a slow adoption curve in many markets.

So what about the content? Apple TV is all about playing video content. There are no widgets and no attempts at getting the ‘web on to the big screen. This is marked contrast to the Yahoo! Connected home and Google’s approach to the TV set as a kind of 21st century teletext.

Given that the iPad is home communal device, this omission may be down to avoiding cannibalisation of sales and a possibly an insight that you may want those applications closer to you than the TV screen?

The pricing of Apple TV content strikes me more as being a tactical move in competition with media retail rival Amazon, and as a lever to demonstrate to the music industry that their pressure for increased iTunes prices is just plain wrong, why would you pay more for a music track than you would for an episode of Mad Men, CSI or Heroes?

One Reply to “Reading the Apple tea-leaves”

  1. Ged an interesting analysis. As you know I have my own hypothesis about what Apple intend in the future. The refresh of iTunes and the iPods for me could signpost the intension to drop the iPhone as Jobs does not seem to be able to manage relationships with the Mobile Networks.

    The lag in software upgrades to the iPad could be an indictor that the product has not been an out and out success. If the iPad does manage to achieve strong sales and significant revenues from Apps then I fully expect Apple to say thanks but no thanks to the Phone industry. It is obviously that Apple does not see the importance of Voice.

    Apple TV is something that is a work in progress. You are correct in that to make it work we need better connectivity (with the ConDem cost cutters not likely to happen soon). The big issue has to be content at the moment iTunes dominates but the pricing is not something that all producers are happy with. Looking at HK we see that every VOD service they have launched over the last 10 years have failed because of limited content. I use my US iTunes account to feed my daughters demands for TV because the lag of the UK service is too long for them.

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