Thursday, December 28, 2006

Would SOME Electronics Business PLEASE Actually Read The Web?

Okay, folks... I've had it. and I am officially losing my mind right now. Why on earth do electronics businesses ignore readily available data about what customer desperately want to purchase, and willy-nilly do their own thing, instead? Why do they not simply do the same thing we all do, and just check the Internet from time to time to see what prevailing opinion is being offered here? Are major company CEO's brain-dead? Have they never heard the term, "search engine?"

Customer Voices Are Hearable Now. Duh.

Hello Sony, Nokia, Samsung, Kenwood, Alpine, Bose, Apple, the RIAA, all the other EU and American brands, and a thousand skilled China and Far East manufacturers: The Internet is here. "Market Research" now takes only maybe two or three-hours of serious Googling to do, on even the most complex product/service proposition. Your customers are online, repeatedly telling you -- loudly -- what they wish the hell you would build or offer or sell. Why don't you listen?

What The Online Voices Are Saying

Dear Technology Businesses: We are universally opposed to being trapped into proprietary revenue generating schemes on content and features. We love simple little devices and services that do one thing extraordinarily well. We like well designed, and well thought-through products and services. We love little doodads and geegaws that truly make our lives easier. We like small, light, and thin. But, we like a sense of weight, and solid engineering, too. We hate being forced to pay new money to update an old product to do new things... or worse, to do the same things we have become accustomed to doing. We hate being viewed as pawns in some manufacturer's greater profit creation aspirations. We love being seen as the most important element in your universe. We like being listened to, and, you can listen to us by spending 3-minutes on Google.

Why don't you?

Why do we have big-ass bulky cell phones with a zillion freakin' menus and features that get in the way of the four features we actually use 99% of the time? Why do we have song files, CDs and DVDs that cannot be legally saved, stored, or used on our choice of devices? Why do we have to endure the high-prices and high-feature burdens of a "high end" cell phone, in order to get a good looking, thin and light handset? Why can't you just build us a simple little handset that is also thin and light? Why is hooking up an HDTV system more complex than configuring a network server? Why must we pay extra to move files from our phone to our PC, when the two products are sitting right next to each other on our freakin' desk?

And, don't even get me rolling on PCs and software and the multitude of interface and usability problems I have to put up with on that front.

Attention Tech Business Leaders

The days of the Focus Group are long dead. You do not need to go grab a hundred people at random at the local shopping mall and herd them into a room to 'test reactions.' You have millions of living, breathing, very motivated buyers right here on the web, all wanting you to listen to what we have to say to you.

Why the hell don't you listen to us?

Monday, December 18, 2006

The iPhone: Welcome To Cellular 2.0

Apple is about to enter the cellular handset market, but not with a product -- with an entirely new type of communications platform.

And -- it will not be announced this Monday. Why? Because Apple's mobile phone strategy is based on overhauling the entire legacy concept of 'phone' now being applied by all other makers and carriers. This strategy revolves around not viewing a 'phone' as a standalone piece of hardware, but as the centerpiece of a mobile communications lifestyle. And, it requires other bits and pieces to be put into play to make this grander vision a reality.

Such a multi-element platform launch cannot be done by a press release. It will require an Apple Event.

Not Your Father's Cell Phone

Apple has studiously and cautiously sat back and observed the unfolding of the cellular telephone market, and the behavior of cell phone users, smartly choosing to not enter the game until it can do so with a winning hand. Despite being loaded with advanced technology capabilities, today's mobile phone landscape is still very much still running on top of the same Cellular 1.0 topology originally launched in the mid-1980's. Handsets are still all-inclusive devices intended to be isolated islands of technology. Apple has a different vision.

Welcome To Cellular 2.0

Even if we have forgotten, Apple still very much recalls its Digital Hub strategy, and makes this concept the underlying mission driving nearly all of its new product creations. The point for most new non-CPU product Apple develops is to substantially improve the usability of that device by having it operate as a peripheral to a Mac or PC running Apple software or connected to .Mac. The iPod has iTunes. The iSight has iChat. The Mighty Mouse has its unique driver software. The experience Apple thus provides users eclipses the prevailing experience offered by existing products. Some of this experience is Mac-only. Some is available on the Windows platform.

In Apple's vision of Cellular 2.0, the phone handset is a roving peripheral to the computer the user has sitting at their home or office. Apple has intelligently parsed users' various communications activities, and has better enabled each by assigning the component actions to the best qualified device. Some actions are done on the computer, some on the handset. With its grip firmly wrapped around software technologies such as Bonjour, iChat, iSync, and .Mac, Apple is uniquely positioned to slice apart the mobile phone experience, and restitch it into something massively more friendly and usable than today's approach. And, by migrating just a portion of this underlying technology to the Windows world, Apple (again... remember the iTunes experience) gets to painlessly demonstrate its vision of user friendly operation to the sea of Win PC users, and add yet another lure to its bait box of Mac platform promotion tools.

Handset + Software + Service = Bliss

In Apple's Cellular 2.0 vision, the handset is not so smart. Like the iPod it logically emulates, the mobile handset is mostly a repository for data synced from the user's computer. Address book info, media files, calendar data, all are created and manipulated on the computer, and simply refreshed into the handset as needed. This approach allows a tiny device to become enormously useful. And, it neatly smashes a hole between today's ideas of 'just a handset' and 'a smart-phone.' In Apple's vision, the 'just a handset' delivers nearly all of the usability of today's smartest smart-phone, but without most of the data input and processor overhead. Apple still very much believes a computer should be a computer, and a peripheral should be a peripheral. Its cellular handset will vividly demonstrate this philosophy in action.

Apple's cellular handset will sync wired or wirelessly with each of the component software pieces running on a Mac or Win system. The data so transferred to the handset will then be easily usable via the handset's highly graphical multiouch UI. And, upon next docking, any address book data added on-the-go by the user will seamlessly be added into the computer's records. All of this behind-the-scenes activity will be easily monitored and managed through a simple syncing functionality put into iTunes that provides easy usability among all of the contributing software pieces, and with .Mac. And yes, the new application will run on both Macs and Windows systems, intelligently supporting whatever underlying software or service components are available to that specific user's system.

Shattering An Industry's Practices

Even with millions of joyous customers snatching Apple handsets from store shelves, the greater market impact will be behind the scenes, on the cellular telephone industry itself. By marketing the handset as a computer peripheral, and focusing sales benefits on the various computer-resident software and services components, not on the handset itself, Apple will be introducing a radically new marketing scheme. No existing manufacturer or carrier can easily match up against this holistic approach to mobile telephony, as they simply do not have the software products nor data infrastructure in place to respond. This is Apple's Cellular 2.0 vision: Make the key usability and selling points all live on the computer or the Internet, not on the handset, and focus marketing on those pieces, not on the handset.

By diminishing the role of the handset itself, and focusing customer attention on the computer-enabled benefits, Apple will leave the entire cellphone manufacturing industry in a panic to begin trying to catch up. And, by marketing the handset as a device that requires no specific carrier support other than a connection, Apple leaves the carriers in a huge quandary -- how do they respond to suddenly having all of their value-add services reduced to irrelevancy?

The User Is The Winner

Apple's entry will shift the earth underneath the cellular industry. Its user experience focused approach to cleaning up the current mess of incompatible, incomprehensible phone functionality, and too-complex do-everything handsets will announce a whole new way to think of 'mobile phones' to the world. And, its focus on computer-side functionality rather than handset functionality will make its handset the easiest to use, simplest to approach product on the market. In the process, users worldwide gain clarity, comfort, and increased functionality in the mobile phone experience. Over time, as they have done with all of their new products, they will expand the concept into a true platform play that supports added functionality, likely from third-party application software, accessories, and third-party service tie-ins, such as Google, YouTube, and others. I wouldn't doubt that the new mobile platform begins to approach the functionality of the current Mac platform itself within a few years. But, that's another post.

The cellular industry is about to be jarringly snatched one giant step forward. It will be fun to watch as everybody else goes crazy trying to scramble and catch up.

Thursday, December 07, 2006

The iTunes Store's Horrible Sales Secret

I have been surprised over the past few years as many data points have been publicized making it obvious that the current state of DRM-protected music download stores is not in sync with the marketplace's desires. My surprise comes from how quiet the world's media is in discussing this reality, and in how easily the music player makers and the recording industry ignore the reality facing them. You see, most people simply do not buy these copy protected legal downloads.

DRM Doesn’t Matter

According to data collected by Jupiter Research, Gartner, and others, the emphasis today's MP3 player manufacturers are placing on DRM scheme compatibility is ill-founded. It seems that very few of today's customers actually ever use an online music store, and they own very few DRM encoded music tracks. Most people rip CDs, or swap files using P2P services.

What About iPod Users?

According to Jupiter Research, about 83% of iPod users do not buy songs from the iTunes store regularly, and are likely to own fewer than 20 tracks wrapped in Apple's Fairplay DRM scheme. It seems that the other 17% of iPod users buy all of the songs being sold by the iTunes Store.

When considering users of Windows based MP3 players, the situation is even more extreme. A recent Gartner study reveals that over 70% of these people have never bought a song from a DRM wrapped online source. And, over 90% fall into the "tried it once or twice and didn't like it" category. The bottom line here is that fewer than 5% of Win based MP3 player owners regularly purchase songs from an online music store.

Summarizing The DRM Scene

Basically, all of the tracks being sold by iTunes and the myriad of Windows based online services are being bought by 20% of iPod owners and 5% of Win based player owners. The important corollary is that today's DRM wrapped music stores are being roundly ignored by 80% of iPod users and 95% of Win based player users.

New Light On This Old Problem

Now, SoundScan is noting that online music sales have basically flattened over the past year, stuck in the 100 to 140 million tracks per quarter range, and showing no sign of striking any steep upward trajectory. Simple math says that, on average, this means that about each MP3 player owner (all makes and models) is buying one download track every three months. Folks, that is not a very impressive sales pace. And, it surely does not describe the sort of "Future Of The Music World" scenario that Apple (and others) would want everyone to believe is coming. Instead, those sorts of numbers clearly describe a failed system.

The Present System Is Broken

Today's DRM-wrapped music download stores, both click-to-buy and subscription varieties are abject market failures. And, all of the vested purveyors are staying mum on the topic, quietly allowing the myth to perpetuate that the approach is actually a fast-growing success story. It ain't true, people.

People are clearly rejecting the concept of paying for digital music files that are layered in swaths of restrictive DRM. Other than a tiny hard-core slice of upper-income buyers, the vast majority of MP3 player owners simply avoid these online stores, including Apple's vaunted iTunes store. And, from the latest market intel, it's evident that even these affluent buyers are slowing down their purchasing.

What Is The Fix?

While DRM-wrapped online song sales are failing as a business model, the traffic in both paid and unpaid non-DRM song files continues to flourish. Yahoo continues its successful experiment in selling non-DRM MP3 music, an effort I mentioned here a few weeks ago. Michael Robertson's site is showing steady sales growth. And, of course, the P2P networks continue to buzz with downloading activity.

While Apple nor the rest of the industry want to publicly discuss their sales numbers and trends, or admit the failed business model now being promoted, the reality is there for anyone who wants to look: The present approach to using DRM to lock out consumers from Fair Use rights is not working. It is a failed system.

One heroic major company needs to stand up, admit this reality, and offer the buying public a major song download option with 1 million plus standard MP3 tracks... including hot, current tracks from major artists, and major catalog selections. A line of edgy new players that completely shunned all DRM formats would also help make the point. Such a store, and such a line of players would show blow-out sales numbers.

The bottom line is this: The vast majority of buyers do not like DRM, do not buy DRM music, and have no interest in players that support DRM music. Somebody with a brain at a major company should note these facts and weave a new business model to replace the obviously failed one now being applied by others.

Sunday, December 03, 2006

Apple's Horizontal Alternative

Apple's OS X could have been a real breakthrough in modernizing the graphical user interface. But, instead, it is merely the best of the current crop. It could so easily have been much more.

Apple's unique Aqua interface has drawn steady fire for the amount of processor resources it consumes, "just being pretty." As the sort of guy who appreciates "pretty," and usually keeps relatively current with my hardware, the lost system resources issue hasn't really impacted my work; my system's more than adequately snappy in OS X, with Aqua shining in all its candied glory. However, I do have a parallel complaint to lodge.

My complaint runs along these lines: (A) Apple chose to improve the visual user interface in OS X, (B) the decision was made allowing the improvements to use up a great deal more system power than had previously been used, so (C), they developed the ever-elegant Aqua.

My complaint revolves around the third component, (C) choosing elegance over functionality. Let me explain.

Break the 20-Year Old Tradition

Let's talk about the GUI, itself. With Apple's move to OS X, the company had a rare opportunity to truly improve the user interface. If extra processor cycles were going to be dedicated to the interface, then Apple could have chosen to use those precious cycles to support a true improvement, rather than a beautification effort. They could have taken today's 2D vertical desktop metaphor and gone to a 3D horizontal metaphor. And, if they had, the world would now be totally focused on the new system, Microsoft would truly be quaking in their boots, and Macland would be overflowing with joy.

Real Desks Are Horizontal

Imagine having the ability to easily add tag-embedded XML-like keywords to all of your files, or to allow the machine itself to make intelligently guessed tags, and to then do free-form searches and retrievals using an über-Sherlock type search utility.

The element of the "flat" GUI of today that truly irritates me, including the pretty Aqua, is that it forces a set of ordered mechanisms on me for creating, storing, keeping track of, and retrieving projects and documents. Going horizontal would instantly ease each of these processes.

I like the idea of having one infinitely sized flat work surface, where I can simply tell the computer what I want, and what I want to do. It then reaches out toward the horizon and pulls in front of me the relevant documents and tools... as well as neatly pushes away from me whatever irrelevant detritus may be covering that required work space at the moment.

The issue with today's desktop metaphor, to my mind, is its verticality. The computer displays a "desktop" as a vertical wall, ascending upward in front of our eyes. The last time I checked, a real desk top occupied a horizontal plane, not vertical.

Organized Like A Real Desk

A convincing 3D representation of a horizontal plane, stretching outward in front of me would be a much more familiar place to work. Should folders and files be thereon represented as containers, piles, and stacks of varying size, then I could easily reach out into that 3D space with my curser, and grab and drag whatever I want back to the workspace in front of me. Those piles and containers could be tagged to correlate with projects, people, activities, timeframes, and other identifying and linking information. This would enable the computer to create on the fly dialogue boxes, asking if any of a shown list of other linked material would be of interest to me, and what to do with that material.

The idea of a horizontal desktop has simply been awaiting the time when the machines were fast and sturdy enough to handle the added processing load. If the Quartz Extreme power had been invested into this revolutionary step, rather than into merely shoring up Aqua's sometimes sluggish performance, Apple would have hit a grand slam.

It's griped me to no end that the smart guys of Silicon Valley came up with the initial desktop metaphor, but then have never developed it to its next logical evolution. The processor power is there today to now support horizontalizing our vertical "desktops."

I wish Apple would do it.