Steve Jobs recently gave Newsweek an interesting interview. In it he spoke about the development of the iPod as well as the impact the device has had on how we listen to music.

To me, the most interesting part of the article is where Jobs talks about the Zune, and in particular its wireless music sharing feature. This is what he had to say:

“I’ve seen the demonstrations on the Internet about how you can find another person using a Zune and give them a song they can play three times. It takes forever. By the time you’ve gone through all that, the girl’s got up and left! You’re much better off to take one of your earbuds out and put it in her ear. Then you’re connected with about two feet of headphone cable.”

I tend to agree with Steve, the younger generations are not very patient. However, what I find really interesting is that Mr. Jobs never says that sharing music is bad idea, what he says is that Microsoft’s implementation of this concept is bad. So, the question is, how would Apple implement such a feature?

The way I see it, it would have to be very simple and quick. You go to a menu, you select your friend’s iPod from a list of devices near you and you immediately hear what your friend is listening to. The songs are never stored in your iPod, just the meta data. When you get home, after syncing your device with iTunes you get a chance to buy the songs you listened to from the iTunes Store. If engadget is correct and Apple releases a new wireless video iPod before the holidays we will know very soon if they can improve the ease of use of wireless music sharing over what Microsoft plans to offer. My guess is that they will, as usual.

From the unprecedented volume of response I have a received to my previous iTV blog entry, it is clear that Apple has generated a lot of interest around their latest gadget.

I have been a proud owner of an eyeTV set-top box since early last year. I must say that I have been very pleased with it, although I have had occasional problems playing some MP3 files which bugs me since the same songs sound fine both on the Mac and on my iPod. The other problem is video. Although most common codecs are supported, there are still many video sources that I cannot view easily on that device (Real video, YouTube and podcasts come to mind).

It is an expectation for improved video quality (my EyeTV device does not include a DVI interface) as well as improved integration with all the iApps that gets me excited about the iTV. Don’t get me wrong, I do not expect Apple to offer DivX and Real Video support out of the box, but I hope that they will allow users to stream any video type supported by Quicktime. Since Quicktime can be extended to support additional codecs (take a look at Perian).

For tech-savy consumers, a new device such as the iTV can seem very attractive, but to reach the rest of the market, more functionality may not be as important as many seem to believe. In fact, less may mean more.

Take a look for example at the number of cables crawling behind any 42” plasma TV. My wife enjoys the usefulness of all these new technologies but she does not like the incredible amount of garbage that is currently required for a complete setup and I agree. I would be very happy if I could get a single device that offered all the functionality that I require. Since the iTV is expected to be an 802.11n base station, I will be able to get rid of my EyeTV and Airport Extreme as well as their related power bricks and the Ethernet cable connecting both devices. That is a great start, but who knows, in the future Apple or their partners could even travel further down this road by offering big screens with an integrated iTV. How likely are we to see such a product in the future? Who knows, but it looks like something I would be interested in.

The new patent just awarded to Apple covers a new type of Universal Remote Control is another step in the same direction. For years we have been dealing with multiple devices and it has been inconvenient. It really seems that Apple has understood that they have a big opportunity improving on all those devices that offer poor human interfaces and have accepted the challenge now that the iPod has propelled them in the consumer electronics space. It is incredible that companies like Sony have not been up to the challenge to solve these obvious problems.

Leo Laporte has been pushing lately for renaming podcasts as netcasts. He argues that non technical people believe that they need an iPod to listen to podcasts and that this limits the potential audience of podcasts. I am not convinced. By looking at my logs, I know that I have IT Insight listeners who download the show using Juice as well as other alternatives to iTunes. Of course, most of my listeners use iTunes, but this only reflects the size of the market share that the iPod has captured.

However, this is not the whole story. Leo Laporte also argues that the dominance of iTunes is bad for podcasters. He seems to believe that a more fragmented market is better for podcasters. He goes as far as asking help from Microsoft to fight Apple dominance. This is ridiculous, it is like asking a wolf for help to keep the sheep under control.

As a podcaster who gets most of my traffic through iTunes, I understand why he may want to depend less on Apple. If your podcast is not featured regularly on the iTunes store or your podcast does not appear in the Top 100 list, you are out of luck and it is hard to get people to listen to your shows. However, Leo can hardly complain from lack of cooperation from Apple as they regularly feature TWiT and MacBreak among their top picks.

So, the question is, what does he expect from a fragmented market? Probably more power for podcasters. It is well known that he is currently in the process of building a network of podcasts and he probably would like people to go to his network page to select their content from a limited number of channels instead of a large directory containing thousands of podcasts where his products can easily get lost.

Will it help if Microsoft gets into the game? Most likely not. Instead of a de facto monopoly we will get either a duopoly or a fragmented market. The difference is that instead of the benevolent dictatorship we have today, we will get a known monopolist who will fight for its own financial benefit, competing not only for hardware supremacy but also for revenue from its own content (think MSN, MSNBC, etc). The same applies to companies such as Time-Warner.

From my point of view, I largely prefer a neutral directory that dominates the market where it is difficult to compete, but everyone faces the same difficulties, over a myriad of services where only professional podcasters, with a enough resources to publicize their shows on all existing directories, can reach all the potential listeners. I also sincerely believe that this scenario is also worse for consumers, at least for now, since the technology is still in its infancy.

I do not think that asking Microsoft for help is particularly wise. They are not known for defending the community interests. Besides, they also have enough interests in the content market for us to expect them to be impartial. Yes, I know, so does Steve Jobs, but since Apple and Disney are separate companies, any coordinated move is likely to go through high scrutiny by investors.

Leo Laporte claims to defend the interests of the podcaster community. He certainly does not represent me. I feel that he has already lost a lot of credibility by endorsing Dell computers on his TWiT show, when everyone knows that he is a Mac user. This is even worse. I feel that he is pursuing his own interests by trying to gain independence from Apple. I do not criticize him for that. I simply believe he should be more open about his true motives.

Microsoft’s move to release their new MP3 player, the Zune just in time for the busy holiday season is perceived by most analysts as a desperate move from the Redmond based company to regain relevance in the strategic digital entertainment market which they had planned to control with Media Center PCs. However, this strategy failed when Apple outflanked them with the highly successful iPod.

Today, the iPod is at the center of the digital media revolution. The world has realized that music is the mobile killer app, and everyone wants a piece of the pie. Mobile phone and PDA manufacturers believe that they can successfully compete in this market because they have two important competitive advantages. First, they produce literally hundreds of millions of devices each year and this translates in economies of scales that are hard to beat, even by a successful company like Apple. Second, an MP3 enabled phone provides more functionality in a single device. Convenience is important to users. As a result, mobile phone manufacturers expect to steal this lucrative market from Apple, and now Microsoft. It sounds like a great plan, but will it work? What if things went the other way round?

Everyone in the industry, including Apple, understands perfectly this convergence trend. In fact, it is widely expected that the Cupertino based company will release it’s own iPhone in early 2007. This means that the hunted is becoming a hunter, by entering the highly competitive cell phone market. How likely is Apple to succeed? It is clearly an uphill battle. Unless they become an MVNO (Mobile Virtual Network Operator), which is unlikely because this business model does not exit in many countries, they cannot simply start selling the device in their existing stores (although they are an important asset for Apple’s ambitions), they have to partner with Telcos. This is a difficult and relatively slow process. On the positive side, they have some strengths, most notably and unsurprisingly, on the software side.

Cell phone manufacturers do not usually provide good software to integrate their devices with the PC. This is a critical mistake as we do know that currently all digital media resides on computers. Carriers would like us to buy all our digital media from their online stores directly from our cell phone, but this is simply not happening, at least in the U.S. and Europe. One reason that explains this is the sheer volume of digital media that users are growing. Today, it is very
common for most users to store anywhere between 20 and 250GB of digital media. This valuable media needs to be backed up and simply does not fit on a cell phone. This situation is not likely to change anytime soon. Digital media needs to be stored, classified and managed and this can currently only be done on a PC. Besides, users make a heavy personal investment learning to use applications such as iTunes. They are not likely to change quickly to another
application specially if it means that they can lose their DRM protected songs as well as valuable information like tags, lyrics or album covers. So, it is clear that currently those who have a better software solution on the PC to manage digital content have the upper hand. This may change in the future if new online digital media storage solutions appear and devices can synchronize quickly and seamlessly with those services, but even with the rapid improvement in broadband bandwidth and availability we are still years away from such a solution becoming viable. This means that Apple and probably Microsoft are much better positioned than Nokia, Ericsson or BenQ to lead the market. Of course, digital media is not the only killer application for mobile phones. Online mail and chat are also very important for both teenagers and business users. In this category Microsoft has a clear advantage, but Apple is not far behind (at least technologically if not in raw user numbers). Once again, traditional cell phone manufacturers lack the chat application on PCs or mail solutions (excluding RIM, the manufacturer of the popular Blackberry device) to effectively compete in this market.

The fact is that mobile phone manufacturers are in a much more delicate position than most realize. They are not in control of their own destiny because they rely on third party software to synchronize data with the PCs where the master data resides. In some cases they even rely on Microsoft’s OS to drive their digital devices. After what we have seen in the game console and portable music player markets, where Microsoft has decided to enter alone, I think that some of their partners should feel very, very nervous. If rumors prove to be true and Apple launches a cell phone in early 2007, it will have taken them about one year and a half to produce their first product and enter the market, but Microsoft with its mature Windows Mobile OS could achieve the same result much faster, specially if we take into account that consumers are not very loyal to their cell phone manufacturer. After all, most consider these devices disposable and will easily switch to the newest trendiest models. Even worse, they cannot really count on carriers to help them defend their current position because these companies simply do not care.

Today, companies like LG with their new Chocolate phone and Sony-Ericsson with the Walkman phones seem stronger than ever, but it could be an illusion. The market could look dramatically different in just a couple of years. We certainly live interesting times.

I was recently listening to the HP press conference where CEO Mark Hurd announced that Chairman Partricia Dunn had resigned her position as a result of the scandal provoked by the spying of journalists in order to obtain the source of leaks within HPs board of Directors.

It is clear to me that Patricia Dunn had the obligation to investigate the leaks. In this particular case, the disclosed information was highly sensitive, the strategic plan that HP had designed for the next year or so. The information published by CNET and others effectively disrupted HP plans by giving valuable information to their competitors with enough time to counter their initiatives.

We now know that the information was delivered to the media by a board member. The journalists must have been aware of the damage they were causing to the company and that they were used as a tool to harm HP. I remember that someone one once said that he could not define pornography but that he could easily recognize it. Something similar happened in this case. As you probably know, I work for IBM, a direct HP competitor in many markets. I felt very uncomfortable when reading the original report published by CNET and the journalists that published this information must have felt that too. Unlike Apple which generates a lot of interest among the general public, HP products rarely generate a lot of buzz. The uncovered information was really only interesting to competitors. Analysts and Investors did not benefit from the report as many of the plans mentioned in the articles will have to be changed now that they are public knowledge.

The resignation of Patricia Dunn is clearly the result of journalists claiming for blood. It is true that the methods used by the security consultants hired by HP to undercover the source leak are very questionable. It is also true, however, that the journalists should have understood the clear difference between news and industrial espionage. I blame both sides and I would like to see a public apology from their part too, acknowledging that they helped a criminal commit his crime. This is not likely to happen. Some bad journalists like to hide themselves behind the freedom of the press to publish questionable information. We must not fool ourselves, this is not the case here. They were not protecting a whistle blower, they were protecting a criminal. Shame on them.

Now that we have seen what kind of damage the leak of confidential information can cause to a large corporation it may be the right time to talk again about the secrets that trickle from Apple headquarters. I know that many will claim that the situation is totally different. In this case, the general public is interested in knowing what new products Apple will release. Besides, Apple rumor sites usually disclose information just a few days in advance, effectively spoiling the Apple announcements but not really impacting their business. But is that really true? Recently a rumor site announced that new Apple laptops would be launched on September 25th. They were wrong, but I have a friend who delayed its Mac Book Pro purchase because of that. He still hasn’t bought it because now there is another rumor that the new laptops will be released any day now since stocks of existing products are very low. His behavior may not be common among mainstream Mac users but even if he represents five percent of Mac users, it becomes clear that such articles do impact sales.

The main difference between the HP as well as other corporate stories and the Apple stories published on the Internet is that Apple rumors are often false and everyone is well aware of that. We Mac users enjoy talking about unannounced products, and for many this is a sort of entertainment. However, we should not be surprised to see Apple act against these rumors because they really hurt their business.

Since the launch of the new iTunes store, there have been stories published by major newspapers that Wall-Mart has been threatening the movie industry with retaliation if they signed a distribution deal with Apple. This story has some credibility as it is well known that Wall-Mart controls 40% of the DVD retail market and they are probably less than thrilled at the idea of losing it. The question here is where is the Federal Trade Commission, which is responsible to protect free trade in the U.S. A simple announcement that they would take a look into this matter would have been more than enough to scare Wall-Mart and have them back-down. Instead, it has been the reaction of the users of the Internet that has prompted Wall-Mart to issue a denial of the accusations. Meanwhile the FTC has continued ignoring the story. This proves that once again, big business is not really threatened by the FTC, but we already knew that. In the monopoly suit against Microsoft it was the States that carried the burden of the lawsuit, not the Federal Government. It is clear to me that the FTC is not working and that something needs to be done in order to fix it.

Since the introduction of the Palm Pilot, back in 1996, most of us have carried at least two electronic devices attached to our belts. The iPod has only made things worse. Consumer electronics companies have seen a business opportunity consisting in developing a device that combines multiple functions previously only available in separate devices. This trend is called convergence.

Today most phones include a digital camera and most consumer level products also play songs. On the high-end, phones are more PDA like, with small keyboards that allow business users to access their e-mail and back-end systems.

From what we have heard so far, it seems that if Apple releases the long rumored iPhone, it will be a consumer phone, with emphasis on providing a good camera, decent games and a great music player. The scroll-wheel (which the device is likely to inherit from the iPod) is perfect for s music player but it is not a good input device for capturing long messages. So, while the rumored device should be a competitive phone in the consumer market, it is not likely to be the product that everyone is looking for. With the rumored feature set, and smaller production volumes than competitors that are better positioned globally, the iPhone is not likely to be the cheapest. It will have to compete at the high-end with PDA style devices and at the low end with cheaper phones that can be purchased almost everywhere and are backed by the telcos.

Even so, in the U.S. Apple should be able to leverage it’s retail stores to reach a large amount of customers. If Apple can grab even a small amount of customers from Motorola, Nokia and Sony Ericsson, it could translate into an incredible growth for Apple. This is a once in a lifetime opportunity.

It has been three days since the September 12 Apple announcement and I am quite surprised that despite the interest generated by the iTV announcement, few are talking about it’s most mysterious feature, the USB port which can be found on the back of the device.

Some have speculated that it could be used to connect a keyboard to the iTV. That could be the case, if Apple decided to convert the product into a game console or an Internet device. It is possible, but I do not believe that Apple is going in that direction, for now. There are other kinds of USB devices that make much more sense, my personal bet is TV tuners.

Within the Macintosh world there are two companies who have developed TV tuners for some time now, namely elgato and http://www.miglia.com/. It makes a lot of sense for Apple to leave this market to third parties, since there are so many incompatible ways to receive TV content today. In the U.S. for example, CableCard 2.0 is competing with conventional Analog TV as well as the new Digital TV designed to replace it by 2009. Making a single device that supports all standards is difficult and expensive. Then there is the problem of user experience. While it may be relatively easy to offer program guides in the U.S. and most of Europe, the situation may be different in other regions/countries where Apple operates. By not including the DVR functionality itself it can market the iTV the same way globally while they partner with others to offer TV tuner products locally.

So, why is the iTV more expensive than the eyeHome? That isn’t totally clear to me, but it would seem much cheaper if it included a 802.11n base station. After all, it includes an Ethernet adapter that could be used to connect to your cable modem or equivalent. This possibility has been discussed by many as Steve Jobs failed to mention what version of the standard they would be using. We will have to see, but the fact is that if I am right and the USB connector will be used to add third party TV tuners, suddenly it all makes sense and we all get what we had been waiting for. I would be really surprised if Apple hadn’t planned that all along. Why not announce it now, then? Well, I guess that Steve Jobs is already preparing it’s One more thing… speech for MacWorld. After all, the iTV announcement was meant for analysts, who needed to understand that Apple’s Movie strategy was aimed at the living room, much more than at the iPod, unlike it’s competitors.

As most rumor sites had predicted, Apple did not announce a true video iPod. This is quite a disappointment for most of us. After all, the iPod hadn’t been updated in a year so we were entitled to a significant upgrade, right? Wrong.

Everyone should understand that it is very difficult to transform a product that was designed to do a single task very well into a platform that is many things to many people. Remember Palm? They had designed this great PDA and people started to ask for more. It eventually became the Treo, which offers great hardware and crappy software. Why, because it was never designed to be more than a simple PDA. Adding more and more features just made the product more unstable. At the end, they recognized the problem and decided that it was better to create a new OS from scratch.

At this point we do not know if Apple is doing the same mistake. However, it is clear to me that the latest firmware release is significantly different from the previous ones. First, it is now possible to install new applications (games). This is a clear indication that the iPod is progressively getting a more complex OS to run on. This is good news for those waiting for an iPhone. Without a decent OS it is simply not possible to expect a powerful handset. I am not convinced however that this OS is yet powerful enough to compete with Symbian or Microsoft. We will have to wait and see.

The second difference is that the iPod has now an API programmers can write to. It is still not a public API which definitively means that some things are missing, but it proves that Apple is working hard to get a decent platform that should attract many developers.

In most cases, the hardware outpaces the software. Palm, for example, never got it’s synchronization software right and Sony will probably not be able to have it’s online gaming network completely ready by the time they launch the PSP. In Apple’s case this is quite different, iTunes 7 is a great platform to deliver digital media and Front Row has been ready for quite a while. It really seems like Apple is being delayed by the hardware.

This should not come as a surprise. As I mentioned in my previous post, a larger screen (with the same resolution used now by Apple to sell it’s movies, 640*480) requires much energy. Better software and improved batteries can help improve battery life but it is simply not enough. The design must change radically and it will most likely require to replace the HD with flash memory which is still expensive. My bet is that Apple is waiting for component prices to drop before they launch the new video iPod.

There may be other reasons to delay the new product. Most people today still want the original iPod design and changing it radically just before the busiest shopping season of the year may not be such a good idea. It may be wiser to introduce the new product in January, as rumor sites have predicted, when sales cool off. Early adopters will buy product and generate enough interest during the year to generate windfall sales by the end of next year. After all, with the new iTunes software, games, lower prices and improved hardware it is not like Apple will face serious competition this year.

Everyone expects Apple to announce on Tuesday a new online movie store. People and analysts seem all to be very excited by the prospects of being able to see movies on the go. Everyone also expects Apple to release a “true” video iPod to enjoy these movies at a better resolution than current iPods. Everyone? Not everyone, I couldn’t care less and I am sure that once the fad is over, most will share my point of view.

I consider myself quite a heavy iPod user. I subscribe to many podcasts which I listen to mostly in my car. When I run out of podcasts I listen to my music library. Most of my podcasts are of the audio kind as I cannot (legally) drive while watching my iPod. I could imagine myself watching tv episodes of 24 or Prison Break on a portable device if instead of driving to the office I had to use the bus, but probably not content that exceeds in length the duration of my ride as this really destroys the experience. Since most national flights are relatively short (specially if you remove the periods where you are not allowed to use electronic devices), there aren’t many opportunities to actually see movies. As you can see, even with a larger screen and better battery life than current iPods, a true video iPod isn’t very appealing to me.

There is a scenario in which a video iPod could make a lot of sense. That would be in the car, for the kids in the back. This would allow parents to carry their collection of movies without having to be scared of scratched or broken disks.

The truth is that there already is a true video iPod. It is called the Sony PSP. This is in theory a great portable device that allows users to play games, listen to music and watch movies on a decent screen. However, the device is failing miserably to take the market by storm in any of these categories. I imagine that those who expect the video iPod to be successful think that Apple may be able to develop a better user interface than Sony to make it more attractive. I disagree. I believe that the failure of the PSP has nothing to do with usability or design. We simply do not have enough time to watch movies on the go.

Watching a movie requires a complete immersion for two hours (or more). This is something that I do less and less because all of the alternative entertainment options (sports, family, internet, etc.) that compete for my limited spare time. The same applies to shorter video content. Even though I enjoy Screen Cast Online as well as Leo Laporte’s Mac break I have much more trouble finding time to watch vodcast episodes than their audio counterparts.

When I choose to see a movie it is usually at home, on a big screen or at the movie theatre, certainly not on a the small screen of a portable device. So, is that future Apple movie store useless to me? Not really. It could save me a trip to Blockbuster or give me access to an immensely large catalog of movies. For example, one of my favorite movies, “The Quiet Man” featuring the late John Wayne is not something that I am sure to get at my local video store (note for the younger, I am not that old, the movie was already old when I first saw it). However, if I decided to buy it, it would need to have at least the same quality I get from a DVD, so that I could enjoy it on my TV, otherwise it would just be useless to me.

Does that mean that I wouldn’t buy a larger screen iPod? Probably not. However it would have to offer additional features. After all, the reason why I bought my iPod with video in the first place was the brighter color screen that allowed me to see the album cover art as well as my contacts with greater detail.