As most probably already know, some countries in Europe (Norway, France and the Netherlands among others) are putting pressure on Apple to force it to open the Fairplay DRM system. They argue that digital tunes should be playable on any digital music player, much in the same way that vinyl records could be played on any turntable.

There are some flaws with that reasoning. After all, I do not recall similar threats to Sony when they released Betamax (and more recently the ATRAC audio compression algorithm) or Nintendo who offers downloadable games that only work on their console. However, I think that everyone agrees with the fact that if Fairplay protected tunes could be played on any device, that would be better for consumers. After all, that would offer everyone the freedom to choose a player fron a different brand once the time comes to upgrade to newer gear. However, even though I am all for more freedom, I do not want this (small) improvement to result in higher prices. Why am I concerned?

Today, Apple can afford to leverage its large iPod installed base to put some serious pressure on the majors in order to keep the price of digital downloads relatively low. Therefore, because Apple makes money on the players, not the music, legal music downloaders have actually benefitted from Apple’s near monopoly. If Apple is forced to allow digital music interoperability, the leverage is lost and the majors will be able to set higher prices, much like what they have done with ring tones (in conjunction with network operators), and regain control of the online music distribution business.

So, who stands to win if EU regulators manage to force Apple to open up Fairplay? In the short term this could seem to be good news for SanDisk, LG or Philips (a Dutch company), among many others. However, there isn’t much money to be made in a totally commoditized market. The real winners would be the music labels, specially the majors (think RIIA), who would regain full control of the market. Where does that leave consumers? We have to choose between Steve Jobs (a benevolent dictator) and the freedom to choose a music player while living under the grip of the music tyrants.

For now, I sincerely prefer the Steve Jobs option. Why? Because right now Apple makes the best music players and because once you start buying a lot of digital music, like I do, the price of each song becomes more important than the price of the player. Of course, things could change in the future and therefore such a measure could become necessary. However, I would really appreciate if EU regulators tried to break the music oligopoly before suing Apple. Otherwise there is a clear danger that the remedy could be worse than the problem they are trying to fix. As a Dutch citizen I would like to see my government reconsider its decision.

As a developer I recently received an e-mail from the ADC (Apple Developer Connection) in which Apple offers to those developers with Select and Premier memberships to buy the new Apple TV using their hardware discounts. I do not want to read too much into this announcement, since it may just be a perk for loyal Apple developers.

However, it is weird that Apple offers a product that apparently cannot be extended in any way (software wise) to developers. It could also be that this offer is mainly directed to hardware developers who may want to offer accessories but I sincerely hope that there will be opportunities for software developers. After all, there is a strong demand for additional Codec support (Divx, Flash video, etc.) and there is potential for casual games like the ones that are currently available for the iPod.

It is unlikely that Apple will totally open access to the Apple TV APIs. In order to maintain control over the user experience, if they decide to open the product to third parties, Cupertino is likely to work with a very small group of developers, much in the same way it has done with the iPod (and will do with the iPhone). I sincerely hope that the ADC mail sent to developers means that at least some of them will be invited to offer additional software that will help improve what already looks like a great product.

When Apple first announced the iTV, back in September, we all assumed that it was just another CE device, much like ElGato’s eyeHome or more recent devices from Linksys. It turns out that this is not true and that the Apple TV is much closer to a traditional computer than previously thought.

According to AppleInsider, the device sports an under-clocked 1.0GHz Pentium-M processor, a 40GB Hard drive, 256MB of memory as well as an nVidia G72M video board with 64MB of video RAM. While the specs aren’t really impressive compared to current laptop offerings, this is as close as you get today if you want to develop a computer that sells for under US$300, doesn’t require a fan [correction: actually the device sports a small fan, however it does not seem to produce a loud noise] and fits in a very small form factor.

This design offers many advantages for Apple. Since it is based on an Intel Architecture, the code developed for iTunes and Front Row can be easily reused. Additionally, in the future, as prices for more recent components continue to drop, the Apple TV can be easily upgraded to support better technologies such as 1080p output and Blue-Ray high-definition DVD playback.

It is clear to me that the Apple TV is basically a low-end Macintosh computer that lacks some features in order to keep the price down and eliminate the need for a noisy fan, an important feature for a device designed to be used in the living room, something that Microsoft, Sony and Nintendo seem to be unable to understand.

We may never see Mac OS X (or any other OS) boot on an Apple TV, although I wouldn’t dismiss the idea. After all, hackers have been able to install linux on a WRT54G router and even on the iPod, so why not do the same with this much more powerful device. However, what really struck me was that at a time when Apple has just dropped the word Computer from its name it may have just released the cheapest Macintosh ever.

The iPhone announcement may have put an end to years of speculations, however I feel that it still raises lots of questions. Many of these questions have already been discused, but surprisingly I haven’t seen any of the following questions asked on the web:

1. What does the iPhone mean for the future of the iPod?
If you were to believe Steve Jobs, the iPhone is an iPod, the wide screen iPod everyone has been clamoring for. The truth is that what people were really asking for was a US$249 80GB true video iPod. The announcement of the iPhone, while exciting, has not eliminated the need for such a product. Apple is expecting to sell 10 millions of iPhones this year, which is great but from my point of view, a true video iPod could easily beat that target. The reason is price, storage and global availability. The low end iPhone will retail at US$499 which is significantly more expensive than the current iPod with video. Add to that the price of the monthly Cingular fee and you can see that this is not a product most teenagers will be able to afford. Storage space is a problem too. I do not have tons of music, photos and videos, yet my 30GB of storage are almost filled up. Finally, there are large regions of the world where the iPod is currently an immense success but, at least initially, there are indications that the iPhone will not be available. Latin America is one of those regions. Most customers there buy the iPods in the US and then smuggle them back to their countries. That will not happen with a product that these customers cannot use at home. So, the question is, will Apple release such a product. That seems unlikely for two reasons. First, it could cannibalize sales of the iPhone which is dangerous since Apple needs a blockbuster launch for its phone if it wants to be a credible player in the cellular maker industry. Second, the true price of the iPhone seems to be close to US$1000, if you take into account the Cingular subsidy. By removing the cell phone features, it is unlikely that you can bring the price down to US$350.

2. Will some of the iPhone innovations eventually make it to the Mac?
Apple claims that the iPhone underlying OS is indeed Mac OS X and it implies that the iPhone inherits most of its power from the Mac. This is probably an overstatement. The truth is that Apple is probably using a deeply modified version of Darwin with a graphics layer that uses some Cocoa APIs but includes many new private APIs not available on the Mac today. That means that there are technologies that have been developed for the iPhone that could be useful for the Mac. Could some of these technologies be the “secret” features Steve Jobs was talking about when he unveiled Leopard at WWDC 2006? We will know pretty soon, when the new OS is released next spring.

3. How long before competitors catch-up with the iPhone?
Apple claims that the iPhone has a five years leap over the competition and that over 200 patents will prevent competitors from releasing a similar product. This is probably an exaggeration. Let’s examine for example the browser included in the iPhone. Apple is just using the WebKit open source project which had already been adopted by Nokia for future phones and therefore, while any contributions made by that company have been available to Apple, it also means that Nokia will be able to soon release a similar browser on their own phones. Sure, the finger based user interface may be unique, but differentiation will diminish over time.

4. Will January 2007 will be remembered as the beginning of the end for the PC?
When Apple first released the original bondi blue iMac, one of its main innovations was the lack of a floppy disk drive. Everyone knew that the device wasn’t really needed but PC manufacturers did not dare to eliminate it. Today we are in a similar situation, this time the endangered species is the PC. Except for some computer intensive multimedia applications such as Final Cut Pro, most of us really use the PC to connect to the internet. By removing the word Computers from the company name, Apple inc. is recognizing not only that it manufactures consumer electronic products but also that the PC age is coming to an end. This doesn’t mean that Apple will stop manufacturing fine computers for the foreseeable future, it simply means that when analysts start to see a downward trend in computer sales to consumers Apple will be somewhat shielded from a negative valuation as they will be participating in other growing markets.

What do you think? Please share your thoughts.

Last year at MacWorld, Steve Jobs announced that 2006 would see many great new products. That was clearly an overstatement. Even though most Macintosh computers were redesigned as part of the Intel processor adoption plan, I think that it is fair to say that most Apple customers were clearly disappointed by the level of innovation displayed by the Cupertino company. This is specially true when it comes to the iPod product line. Sure, the iPod shuffle and the iPod nano were totally redesigned, but since the functionality remained the same, there really wasn’t much to write home about. Even less impressive were the marginal improvements made to the iPod with video. Sure, there were some bright spots, the iPod Hi-Fi offers rich sound in a practical form-factor and the Nike+iPod kit is a nice addition to the iPod nano, but nothing earth-shattering was released.

As a result, expectations for this MacWorld are high, extremely high. In fact, probably too high. People expect Apple to introduce the long rumored iPhone alongside a new “true” video iPod and even an “ultra-light” Mac Book Pro. This is simply not realistic. In order to be effective, a product launch has to focus on a limited number of products and convey a clear message. Apple understands this very well. In September, for example, the 24″ iMac was launched without fanfare, just a couple of days before an Apple event. Why? Because they wanted the press to focus on the new iPods as well as the strategy that the company had designed for the future, nothing else.

Simultaneous product launches and rare and usually ineffective. I recall a 2003 Hewlett-Packard product launch that introduced over 150 new consumer products, but that largely remains an exception. These types of events are generally targeted at industry analysts and resellers rather than consumers. That is not the kind of audience you get at a MacWorld keynote.

So, what should we expect from MacWorld?

1. State of the union address.
Last year was a great year for Apple. We should expect Steve to talk about significant market share gains for the Macintosh division as well as stellar results for the iPod.

2. Upgrades to iLife and iWork
This shouldn’t come as a major surprise as iLife and iWork are important cash-generators for Apple. That is why Steve has to generate excitement over new versions at each MacWorld. Last year Steve almost ignored iWork and instead focused on iLife which included many new features as well as a new application, iWeb. This year expect Steve to spend more time on iWork, specially if a rumored spreadsheet application is finally announced, which at this point is likely. Nobody really expects major changes to iLife, except for probably an important iWeb revision.

3. Leopard preview
Mac OS X is another important cash-cow for Apple. Steve has to generate a lot of buzz to make sure that Mac users lineup in Q2 to purchase the new OS when it becomes available. This is specially true, now that Microsoft is so close to launch Vista to the general public. Therefore expect Steve to show some of the “secret” features he talked about at WWDC.

4. 802.11 everywhere and iTV
We already know that Apple will officially launch the iTV (along with a new name). That, by itself is important, but I think that Steve Jobs will also use that announcement to endorse the emerging 802.11n standard and announce a free OS upgrade (10.4.9) to enable it on modern Intel Macs that already support it. He will probably also announce an external 802.11n adapter for older hardware as well as a replacement for the Airport Express.

5. Updated Mac Mini and/or new Cinema Displays
Apple has not updated their displays in over two years now, and it shows. This means that in order to remain competitive they need to refresh their line of Cinema Displays. Some expect the new displays to sport a built-in camera, but personally, I am not convinced. This is probably not a very important feature for the pros who buy multiple displays to edit video or design magazines. I find it more likely that Apple will add new features that will make the displays more palatable to consumers. On the other hand, the Intel based Mac mini, which is now turning one, could finally evolve into the media center everyone has speculated with.

6. One more thing
All these expected announcements do not leave much time to introduce a lot of additional new products, unless anyone expects Steve to stay on stage for four hours. My personal bet is that Apple will release a new video iPod with a much larger screen, but similar in concept to the current iPod with video. Don’t get me wrong, I do believe that Apple will ultimately release an iPhone but not at MacWorld. When that finally happens, probably after the echoes of MacWorld and CES start to fade, it will be at a special event, in order to generate additional buzz but primarily to have enough time to explain in depth how Apple will differentiate its offering from the competition as well as its mobile strategy.

I was recently assigned a new company car by IBM, a 2007 Toyota Camry. I must say that, so far, I have been pleased with it. My only major complain has been related to the audio system, which cannot be replaced by a different one. The reason I wanted to change it was because of the poor integration it offered with the iPod. Sure, there is an AUX entry which can be used to connect any MP3 player to the car’s audio system, however, this is not very practical as you need to take your eyes off the road in order to control your device. Furthermore, if you are charge your device by connecting it to the cigarette lighter, you will immediately notice an annoying noise distorting the sound, which makes it very unpleasant to listen to music while charging your iPod (this is not considered a flaw, it is documented in the car’s manual).

In my previous car, a Chevrolect Vectra (also known as Opel Vectra in Europe), I had replaced my built-in stereo with a Pioneer device that allowed me to easily control the iPod from the radio controls, with my MP3 player hidden in the glove compartment. That is why I immediately started looking for a similar product for my Camry.

I must say that there weren’t many options for my vehicle. Products like the iCruze from Monster simply do not support my car and I know that many other car owners face similar problems. So, when I finally found the drive+play system from Harman Kardon, which works on any car, I was relieved to see that there was a solution to my problem. The best part is that the functionality I get from this product is much better than what my previous car stereo offered me, as I can now have access to all my songs and not just a limited number of playlists. In addition, this device not only allows me to easily control my iPod but also see the songs that are playing on a small but slick screen that does not obstruct my vision. Last but not least, I can also finally listen to the music while charging the iPod. The background noise is still there, but is much less noticeable. I can even swear that I get better audio quality than before, but this is just my particular perception, your mileage may vary. No wonder this product has won so many awards, it is an outstanding, well built solution.

Although I totally recommend this product to any serious iPod user, it has a number of small irritating flaws. The first one is that it cannot handle non-ASCII characters. Since I listen to a lot of international music which often includes accentuated characters in the song metadata (title and artist), seeing them replaced by blanks is disappointing. The other problem is that the scroll wheel is not as responsive as the iPod’s and therefore, navigating through long lists of songs, albums or artists can be cumbersome. However, this does not change my overall opinion that the Drive+Play product is the best car accessory I have seen so far for the iPod.

Microsoft has just released the Zune (in the U.S. only). This seems to have generated a lot of buzz among geeks, even though the general public does not seem to have followed this story with the same level of interest.

I must say that I have not been particularly impressed by the Zune. This is my Top 12 list of reasons for sticking with Apple (10 was simply not enough):

1. The iPod has more accessories
2. The iPod offers better integration with cars
3. iTunes offers seamless podcast support, unlike the Zune which requires third party software
4. Apple has a clear personal digital media strategy that goes beyond the iPod, as demonstrated with products such as Airport Express and the upcoming iTV
5. iTunes is the best software to manage digital media
6. iTunes is multi-platform (Windows and Mac), unlike the Zune software that is Windows only and still does not work on Vista
7. Airlines are starting to offer iPod integration with their in-flight entertainment systems
8. iPods can play games (Hard Disk drive models)
9. The iTunes store offers more songs than any competitor
10. iPods are smaller and lighter
11. Apple offers worldwide support for the iPod
12. The songs bought on the iTunes store can be used more liberally.

So, what do you think? Did I forget something?

Last September, Apple’s Steve Jobs clearly explained the strategy for the iPod during a Special Event. He mentioned that people can now use their digital content on their iPod, in their cars and on their computers. The next step is to be able to access that content from the living room on large TVs through the se of the upcoming iTV device.

However, there is still one crucial piece missing, namely storage. On many PCs, specially on laptops, storage is still constraint. On my 17” Mac Book Pro I use about 25% of my internal HD with digital content, which currently is mainly music and a couple of TV shows episodes (mainly promotional content given away by the iTunes store). However, once the iTV is released, I see myself subscribing to more vlogs and probably purchasing movies, specially if Apple moves to a HDTV quality format.

The obvious question is where will I store all that content? I just checked the size of an episode of Weeds and it weights 357.6MB. In this case, the first season of this show only consisted of 10 episodes, but this is unusual, 22 to 24 episodes is what we should expect. That means that if you subscribe to just three standard 40 minutes shows, you require 25GB of free space on your hard disk drive and that is per year! This may not sound like a major problem if you have one of the new custom built iMacs equipped with a 750GB hard drive, but it should worry the owners of an 60 or 80GB iBook.

So, what is the solution? Desktop users do not have a problem, they can easyly add external hard disk drives and stack them on their desks. However, the world is shifting away from desktops, as most users value more mobility over performance. For mobile users, external drives are not very practical. Don’t get me wrong, I do have an external device for backup purposes, but I do not enjoy the process of taking it out of the drawer where I store it, connect it and later unplug it and return it to its drawer. I can live with it, but I do not enjoy the process. If I had to do that in order to watch a movie or a TV show, it would probably be a show stopper. For me, taking a DVD out of its case and insert it in the DVD player is just much easier.

Of course, there is a solution. It is called NAS (Network Attached Storage). Apple sells a NAS device for its XServe rack server, it is called XServe Raid and allows professional users to store up to 7TB of data which, combined with XSAN, can be shared by up to 64 concurrent users. However, at even under $2 per MB, this product is still clearly aimed at professional users. What home users really need is a smaller capacity wireless NAS device, where everyone at home can store their digital media. With 802.11a/b/g this was simply not possible, but now that Apple and others seem poised to adopt the much faster 802.11n, this now seems like a viable solution. With such a device turned on 24/7 in your den, you could backup your files from your laptop at any time and watch all your TV episodes without having to turn your computer on. Better still, by using RAID and hot-swappable drives, your valuable files would be totally safe.

I certainly hope that Apple is working on a Bonjour discoverable NAS, because we all know that it would transparently integrate with iTunes and the upcoming iTV device. However, should they decide not to enter the market (after all such a device could easily cost more than US$500, which puts it out of the reach of most consumers) there is an opportunity for third party manufacturers such as Linksys or Maxtor that have started dabbling in that market with some promising, though immature products like the NSLU2 and the 500GB Fusion.

On Tuesday Apple released new Mac Book Pro Models. This wasn’t a big surprise as as Intel had announced the new Core 2 Duo chip months ago and speculation was running high that new models would arrive in time for Christmas. What strikes me is that while everyone expected this announcement, rumor sites had to resort to inventory checks at the retail and reseller levels to predict the announcement date. Nobody outside Apple knew in advance the specs of the new notebooks. It seems that Apple has finally been able to totally eliminate confidential information leaks. Sure, there have been screenshots of the latest Leopard developers release but this was expected as it is very difficult to control a relatively large community of programmers working outside of Apple, but that is it.

It seems therefore that rumor sites are left with few elements to work with, namely public information from Intel, inventory checks, patents and, of course, speculation and wishful thinking.

The iPod just turned five. I remember buying mine in Orlando at a CompUSA store just a couple of weeks after Apple launched it. At the time there were no podcasts so I used it the way it was intended to be used, to listen to my music library and it was a vast improvement over anything I had used before. At the beginning, my IBM colleagues where not impressed. Today they all have iPods. The revolution that the iPod caused can only be compared to the launch of the original Sony Walkman during the seventies.

Five years later, the iPod hasn’t changed much. Sure, the scroll wheel isn’t really a wheel anymore, the HD capacity as grown steadily, iPods now play videos and can even play games but even with all the innovation talk that surround Apple, technology improvements are incremental. Turning great ideas into actual products takes time and since companies like Apple usually depend on off-the-shelves components they really cannot create revolutionary products easily. Of course, where Apple is really shines is in the area of software development. During the last five years iTunes has evolved much faster than the iPod and gone from a simple MP3 player and CD ripper to a fully fledge digital media library. There are decent competitors to the iPod on the hardware side, but no real iTunes competitors.

It is clear to me that the iPod is ready for a major overhaul. The rumored iPhone, coupled with a successful iTV could give the iPod another couple of years of success with the public in a highly competitive marketplace. Once released, the iPhone will be greeted with cheers by expectant crowds. However, the iPhone already exists. In fact there are many iPhones, created Sony-Ericsson, LG and BenQ, among others. When Apple announces the new iPhone it will likely bear many similarities to those existing products. However, what we are looking for is better software that will allow for a better user experience, better integration with existing applications such as iTunes and iChat. Those who say that software cannot help make a company differentiate itself from the competition are wrong, dead wrong. They just cannot write good software. This is true in the Consumer Electronics space, but also in the Enterprise.