I disagree. If there truly is convergence in the future for phone/music portable devices, and if Apple holds it's strong market position, Microsoft could find themselves out of a large chunk of the very lucrative smart phone/PDA racket. Never mind the fact that a foothold with iTMS gives Apple strong brand potential to get into the living room, etc.
This isn't about making money on devices that MS thinks will be a market in decline in 5 years (if that), this is about overall market positioning. I suspect MS will flop if only from philosophical incompatibilities with the market itself?though it is by no means a sure thing?and Apple will have several new CE market opportunities in the coming decade. It's Apple's gambit to lose, however.
But the money is not in selling the music, it's in selling the hardware. If they have to bite the bullet and pay for people previous iTunes purchases, then so be it. But if they are not making money by selling the player, then there is no point. Apple has proven that there is no money in the store, they do little more than break even with iTunes.
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
The average cost an iPod owner has invested in their iTMS library is $20. (50 million iPods, 1 billion songs sold.) So I can't see the purchased music as much of a barrier. It's not like switching from a Pc to Mac where Pc users could easily have hundreds and thousands invested in software.
I'm sorry but -- it would take a hell of a lot more than giving me the songs I already own in a different format to convince me to switch to another MP3 player. As I see it, only Creatives has any chance of any marketshare. Even there thats a game of chance.
fiBesides the hack, you know what will happen - first you sign up for passport, MS will assign you a 27 digit security code for every song you convert. if it goes wonky, email passprt to get support or get in the queue for $49 a year ... meanwhile enjoy the splash screens for Vista, XBox 360 and love & kises from Steve Ballmer.
Then everytime you play the song, you must be connected to the internet for verification.
Meanwhile, the patch for version 1.001 will load.
If that weren't funny, it'd be tragic because it's true.
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
I don't know about that. To suggest that EVERY iTunes/iPod user would want to take Microsoft's bait... is absolutely ludicrous. Apple offered a superior product in order to gain marketshare, they didn't have to bribe anyone. On the face of this, I think they'll gain no more inroads into Apple's territory than Sony has.
After re-reading the article I'm thinking that maybe this is not just going to be a music player. MS plans to release the device by November and follow up with a MVNO in 2007... That sounds more like this could be a convergence device, phone/music player/pda which means there would be a hefty monthly service fee. I mean, if they are re-purchaing switchers iTunes libraries and subsidizing the cost of the player to compete, they are gonna have to have some form of a profitable revenue stream. As a Mobile Virtual Network Operator (MVNO,) this makes more sense.
I don't know about that. To suggest that EVERY iTunes/iPod user would want to take Microsoft's bait... is absolutely ludicrous. Apple offered a superior product in order to gain marketshare, they didn't have to bribe anyone. On the face of this, I think they'll gain no more inroads into Apple's territory than Sony has.
Although the $20 iTunes library is an AVERAGE. Mine is about £500-£600, and the vast majority of those are actually Audiobooks at between £16.95-£21.95 a pop.
Don't think MS would compensate those. And besides, I don't think I'd switch to some crappy player/software made by MS and their partners, because all the other players are a pain in the ass and Media Player sucks (I have no hopes for the "new software" either).
iPod has become a lifestyle icon, which is something Microsoft cannot do anything about on the short-run. The whole stuff about incompatibility, wma, AAC and all is barely known from the mass audience.
The only way I would see to dethrone the iPod would be to massively advertise, product placement on MTV clips, sportsmen and movies.
iPod has become a lifestyle icon, which is something Microsoft cannot do anything about on the short-run. The whole stuff about incompatibility, wma, AAC and all is barely known from the mass audience.
The only way I would see to dethrone the iPod would be to massively advertise, product placement on MTV clips, sportsmen and movies.
In this you are correct, but unfortunately MS has the Giraffe money? to make all of them and more. Looking marketing budget of 100 Million dollars for Vista and it's peanuts for microsoft to throw on it, with these amounts of money you can sell anything to anyone.
When Steve strong-armed the record companies into keeping the songs at 99 cents he had the upper hand. He has the only *popular* legal music service out there and the record companies know they have to get into the internet download realm.
I'm wondering if Microsoft won't offer the "tiered" music pricing that the record companies wanted so all the companies will flock to them (assuming Microsoft product gains in popularity) and threaten to drop Apple, forcing Apple to buy into the same pricing scheme.
The only way Microsoft could make a dent in Apple's MP3 marketshare is if they mailed out millions and millions of their own MP3 player for free to people's homes. And I wouldn't put it past them. I wouldn't be surprised to see a free Microsoft MP3 player included this Christmas with the purchase of Windows Vista, an xBox 360, and any new Dell computer. Buy all three and give two to your friends as gifts. Plus they'll be giving 1 away every ten minutes at every Walmart this shopping season. Microsoft won the Operating System, Browser, and Media Player wars because their shit came installed by default on 9 out of 10 computers sold. The only way they know how to win is by giving you their stuff for free so you don't bother looking at the alternatives.
But in their defense, if it's true that their xBox 360 guys are working on their MP3 player, then they stand a chance of making something remotely usable. I do like the xBox 360. But beating Sony in design and usability is nothing like beating Apple.
I think this is an excellent marketing decision on Microsoft's part. It's a great way to counter Apple's lock-in stragety with the iTMS (I'm amazed the record companies agreed to do it.)
If their music player and software both work on a Mac and their new music player offers things the iPod doesn't, I would actually consider switching to their product.
Realistically though, I doubt that what they come out with will be fully compatible with the Mac (if at all), and if it is, I find it unlikely that there will be enough benefit over the next iPod offering for me to switch.
The records companies would not care as Microsoft would still have to pay them, indeed one could argue the record companies who are resentful of Apple's success would be happy (and foolish enough) to help Microsoft.
As you say, the chances of Microsoft supporting the Mac with such a product are represented by a number so much LESS than zero that my calculator blew up trying to show it (more fool Microsoft).
Personally, I think that if Microsoft do try and 'buy' customers by effectively giving away music in this way that such action would be illegal as an abuse of Microsofts monopolistic position. (Yes, yes, Microsoft are the minority in the Music field, but THEY are a convicted criminal for abuse of their monopoly holding position and therefore subject to greater restrictions.)
Dumb question: how many iPod users actually use iTMS (ie. buy music online)?
Does it really matter? iTunes has sold over 1 000 000 000 songs, most users propably haven't bought any tracks from iTunes store, but some have quite many. Probably close to everyone who has iPod uses iTunes to at least fill it with music, yes there are other programs for that as well, but my guess is they are a minority. Then there are also many who just use iTunes as a media library a) because it came with their mac or b) because it's superior to windows media player(>=10)
Comments
This isn't about making money on devices that MS thinks will be a market in decline in 5 years (if that), this is about overall market positioning. I suspect MS will flop if only from philosophical incompatibilities with the market itself?though it is by no means a sure thing?and Apple will have several new CE market opportunities in the coming decade. It's Apple's gambit to lose, however.
Originally posted by solsun
But the money is not in selling the music, it's in selling the hardware. If they have to bite the bullet and pay for people previous iTunes purchases, then so be it. But if they are not making money by selling the player, then there is no point. Apple has proven that there is no money in the store, they do little more than break even with iTunes.
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
No worries here.
Originally posted by backtomac
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
The average cost an iPod owner has invested in their iTMS library is $20. (50 million iPods, 1 billion songs sold.) So I can't see the purchased music as much of a barrier. It's not like switching from a Pc to Mac where Pc users could easily have hundreds and thousands invested in software.
Originally posted by jbelkin
fiBesides the hack, you know what will happen - first you sign up for passport, MS will assign you a 27 digit security code for every song you convert. if it goes wonky, email passprt to get support or get in the queue for $49 a year ... meanwhile enjoy the splash screens for Vista, XBox 360 and love & kises from Steve Ballmer.
Then everytime you play the song, you must be connected to the internet for verification.
Meanwhile, the patch for version 1.001 will load.
If that weren't funny, it'd be tragic because it's true.
Originally posted by backtomac
It certainly removes any reservations a switcher may have knowing they can convert all iTunes purchased music to mTunes. I dont' know if it will work but it's hard to dismiss a company willing to loose a BILLION dollars in order to get market share. That boggles my f@*$ing mind.
I don't know about that. To suggest that EVERY iTunes/iPod user would want to take Microsoft's bait... is absolutely ludicrous. Apple offered a superior product in order to gain marketshare, they didn't have to bribe anyone. On the face of this, I think they'll gain no more inroads into Apple's territory than Sony has.
M$, give us a break and dissapear!
Originally posted by SpamSandwich
I don't know about that. To suggest that EVERY iTunes/iPod user would want to take Microsoft's bait... is absolutely ludicrous. Apple offered a superior product in order to gain marketshare, they didn't have to bribe anyone. On the face of this, I think they'll gain no more inroads into Apple's territory than Sony has.
Although the $20 iTunes library is an AVERAGE. Mine is about £500-£600, and the vast majority of those are actually Audiobooks at between £16.95-£21.95 a pop.
Don't think MS would compensate those. And besides, I don't think I'd switch to some crappy player/software made by MS and their partners, because all the other players are a pain in the ass and Media Player sucks (I have no hopes for the "new software" either).
Originally posted by solsun
...That sounds more like this could be a convergence device, phone/music player/pda which means there would be a hefty monthly service fee.
And look how well all those multi-function devices are doing against the iPod.
I hate the combo-devices. They are "a jack of all trades, and a master of none".
The only way I would see to dethrone the iPod would be to massively advertise, product placement on MTV clips, sportsmen and movies.
Originally posted by chouchou
iPod has become a lifestyle icon, which is something Microsoft cannot do anything about on the short-run. The whole stuff about incompatibility, wma, AAC and all is barely known from the mass audience.
The only way I would see to dethrone the iPod would be to massively advertise, product placement on MTV clips, sportsmen and movies.
In this you are correct, but unfortunately MS has the Giraffe money? to make all of them and more. Looking marketing budget of 100 Million dollars for Vista and it's peanuts for microsoft to throw on it, with these amounts of money you can sell anything to anyone.
Sounds like a pain in the ass to me.
Originally posted by ashnazg
When Steve strong-armed the record companies into keeping the songs at 99 cents he had the upper hand. He has the only *popular* legal music service out there and the record companies know they have to get into the internet download realm.
I'm wondering if Microsoft won't offer the "tiered" music pricing that the record companies wanted so all the companies will flock to them (assuming Microsoft product gains in popularity) and threaten to drop Apple, forcing Apple to buy into the same pricing scheme.
Any thoughts?
Greedy? I'LL show you greedy!
This makes a lot of sense.
But in their defense, if it's true that their xBox 360 guys are working on their MP3 player, then they stand a chance of making something remotely usable. I do like the xBox 360. But beating Sony in design and usability is nothing like beating Apple.
Originally posted by Zweben
I think this is an excellent marketing decision on Microsoft's part. It's a great way to counter Apple's lock-in stragety with the iTMS (I'm amazed the record companies agreed to do it.)
If their music player and software both work on a Mac and their new music player offers things the iPod doesn't, I would actually consider switching to their product.
Realistically though, I doubt that what they come out with will be fully compatible with the Mac (if at all), and if it is, I find it unlikely that there will be enough benefit over the next iPod offering for me to switch.
The records companies would not care as Microsoft would still have to pay them, indeed one could argue the record companies who are resentful of Apple's success would be happy (and foolish enough) to help Microsoft.
As you say, the chances of Microsoft supporting the Mac with such a product are represented by a number so much LESS than zero that my calculator blew up trying to show it (more fool Microsoft).
Personally, I think that if Microsoft do try and 'buy' customers by effectively giving away music in this way that such action would be illegal as an abuse of Microsofts monopolistic position. (Yes, yes, Microsoft are the minority in the Music field, but THEY are a convicted criminal for abuse of their monopoly holding position and therefore subject to greater restrictions.)
Originally posted by chouchou
Dumb question: how many iPod users actually use iTMS (ie. buy music online)?
Does it really matter? iTunes has sold over 1 000 000 000 songs, most users propably haven't bought any tracks from iTunes store, but some have quite many. Probably close to everyone who has iPod uses iTunes to at least fill it with music, yes there are other programs for that as well, but my guess is they are a minority. Then there are also many who just use iTunes as a media library a) because it came with their mac or b) because it's superior to windows media player(>=10)