Some inventions just sell themselves. Like this. Cells with a USB Charger built into them. Genius.
As a general rule of thumb, you know a company is going to make it big when you read about what they do/sell and immediately think to yourself “Why didn’t I think of that?!” That, in my opinion, is the only benchmark that works.
They should watch out for the Duracell’s and Energizers though.
Microsoft is looking to kick off its challenge to the iPod juggernaut today with its Zune music player. Gizmodo recently ran 5 Reasons Why the Microsoft Zune May Succeed. I counter this with 5 reasons the Microsoft Zune will almost certainly not be an iPod Killer.
1. Too late in the game. Microsoft has given Apple a 5 year head start in the music market. While 5 years is not really much of a lead generally in the tech industry, where standards and benchmark products change swiftly, Apple has managed to sell over 60 million iPods since launch. More importantly, it has sold over a BILLION legal songs on iTunes at 99 cents a piece (mostly). That’s a sizable investment from iPod users, in music while will be totally incompatible with the Zune. Microsoft would be smart of use some of its muscle to get music companies to allow consumers to trade legal songs bought off iTunes to Microsoft’s Zune Music Store format (whatever it may be) for free. But this is unlikely to happen and an iPod user with, say, a modest 200 legal songs will have to buy the same music all over again in the Zune music store. That adds an extra $198.00 price tag to the price of Zune, which at $300, is already reported to be $50 more than Apple’s iPod.
2. One size doesn’t fit all. Microsoft will be launching one basic version of Zune, a 30 GB model. No “lite” model is available, ala the iPod nano (and, to a lesser extent, the Shuffle). This is a mistake. The only player which has moved more units than a full-sized iPod is the iPod nano. While it’s important to have a full-sized flagship Zune player to announce their presence in the market, a sleeker (and cheaper) Zune is needed to appeal to the masses.
3. Apple is sexy. Apple has spent a lot of time and money cultivating a sexy image. Steve Jobs is a rock star and Apple announcements are his concerts. It has a rabid following of early adopters, “apple fanboys”, who will endlessly protect the company, and laud its every move to anyone who listens, whether online or off. But all this marketing and PR wouldn’t be worth a cent if Apple didn’t have it’s greatest weapon, a passionate, rabid obsession with simplicity. Steve Jobs brought over this culture of finely tuning every product to the widest possible market, without losing the X factor or sex appeal, over from Pixar. The result: the iPod is stunning and simple to use. But you already knew that. While cynics might say that Apple tries to appeal to the lowest common denominator with its offerings, that is a good thing, because it works well for everybody. Buying and listening to music on an mp3 does not need to be an intellectual endeavour.
4. Zune WiFi sounds complicated. Although its too early to say, I will venture out on a limb and say that Zune’s WiFi feature will be relegated to geek status and be useless (and too complicated to use, to boot) for the average Joe listening to music on the way to work. What Microsoft is trying to do here? Disrupt? Well, sadly, this won’t do the trick. Not only is the feature useless to most, it also suffers from the chicken-and-egg paradox. You can only broadcast to, and ‘socialize’ with other Zune users. But, without a really compelling reason to buy ensuring an instant and overnight success, will there really be other users to share with? Think about it.
5. Talk of a connected, social music experience is BS. Microsoft is aiming to make Zune the first in a line of integrated, connected entertainment products which will make listening to music a seamless and social experience. Will streaming your Zune’s music to your Xbox 360 from across the room, to your 7.1 speakers might sound cool, it isn’t something most people really want to be able to do. The iPod works because it’s simple. It plays music. Some can play video too. That’s all. Plus, Apple invented the only seamless experience that matters when it comes to music, the ability to buy and transfer music quickly and simply. As mentioned in an earlier post in this blog, the iTunes Music store is Apple’s greatest weapon in the entire iPod line.
Bonus Reason. The iPod is a monopoly, or the closest one can get in an consumer electronics product. And as Microsoft knows, monopolies rarely loose, even if they have inferior products at higher prices (which Apple certainly does not).
So now, I would hate to bash the Zune without at least offering what the real iPod killer should (could?) be like. To really innovate, lets think of a problem with the iPod. I have owned one for over 2 years now, a full size 3G 15GB model and it serves me adequately. While its nice to have all music with me at times, especially on long trips, sometimes (while jogging, perhaps), I would definitely prefer a smaller player. Does this mean I have to buy 2 iPods (A nano/shuffle and a full sized one)? Also, even if I have 2 iPods, do I need to sync them separately? My iPod Killer would be 2 devices in one. A full fledged hard disk mp3 player backed by a simple and easy to use music shop. Flip a switch (or press a button) and it will “eject” a smaller, flash based mp3 player with limited built in storage. The smaller player would automatically sync all my favourite songs and playlists while syncing with my PC and thr larger one will hold all my music and video. The smaller player will have~ 4 GB of flash memory and will share few components with the larger player, like the controls, some internal electronics and the headphone jack. With flash based mp3 players getting smaller, with sizes as small as a fraction of the width of a pencil, it wouldn’t be hard to create a player like this electronically. The real challenge would be to make it aesthetically pleasing as the iPod. Anyone out there willing to make a mock-up? Email it to me at alizaki at gmail dot com.
Its really hard to call Web 2.0 companies ‘businesses’ for the simple reason that most of them don’t have revenue, don’t plan on developing (or rather can not) any significant revenue streams in the near future and hence, exist solely to provide cool services while the VC money is burning the stove. End result: You get features and micro-services masquerading as companies.
Worryingly, you have respected investors like Paul Graham of YCombinator urging entrepreneurs “not to sweat the business model too much“.
The guys at XuQa have taken that first step towards making a real Web 2.0 ‘business’. Rock On.
Digital video downloads have been the flavor of the week for a while now, but things are really heating up now. Youtube is the company to beat these days on the Internet. Grouper, a competitor, sold for $65 million recently to Sony. Even Microsoft is jumping into the act. Google Video has been selling TV Shows for as little as $1.99 each for a while now, but no one to date had really sold feature length Hollywood movies on the Internet in an organized fashion. Until a couple of days ago. Amazon.com, of all the people, launched a new website which enables digital movie downloads. Called Unbox.com, Amazon has pretty much scooped Apple on this one. And I’m sure it hurts.
Its pretty obvious that Apple has been working on a movie download store for a while now. Makes sense if they’re going to introduce large screen, video capable iPods soon (as the rumour goes). They’ve been working with major studios and I’m sure Job’s & Co. have been milking his Disney connections for all they’re worth.
But here’s something curious. Disney is the only major studio that hasn’t signed up with Amazon yet. And apparently, Disney is the only major studio Apple has signed up to date for their own store. Something is rotten in California. Should Apple be panicking now that Unbox.com has launched? How much value does Amazon scooping Apple really have?
Apple’s greatest advantage is iTunes. That is the reason why the iPod took off like nobody’s business. Allowing common folk download legal digital music quickly and simply sparked the iPod generation (Napster was great for techies and college kids, but most folks didn’t have the time or the willingness to use it).
But now the iPod is pretty ubiquitous, including the Video capable model. Any iPod Apple launches with large screen movie support is sure to be a success. So Apple has time on it’s hands to negotiate with the major studios to secure better pricing for us, which is the most probable reason for this delay. Luckily, Amazon doesn’t have the hardware to support their store just yet. End game: Consumer wins(cheaper pricing hopefully)!
This is a good time to talk about the flat pricing iTunes has for its music store, which is what Apple wants for its movie store as well. Frankly, it just doesn’t make sense to me on the face of it. Why should more popular music (or movies) cost the same as less popular stuff? Instead, let a free market be created for digital media. Who knows, new bands (or indie movies) might even profit by undercutting better known ones on price and get heard. Better yet, let users participate in a real time auction for digital media online, with Apple (or anyone else) only releasing certain number of licenses per track/movie per day. Result: You might have to pay $10 for the best song off the new Black Eyed Pea’s album but might just pick up a B-side no one really wants for very, very little. This model could definitely work very well with respect to optimizing revenue for the music industry, especially if only applied to new music, say all tracks released in the last 6 months (After which they are all sold at a flat rate).
Disclaimer: Yes, this model would definitely be againt artistic principal (Yadayadayada), but really, if your band is worried solely about their art, they should be on eMusic, instead of hiding behind Apple’s DRM.
*You will need IE and Windows to watch
Crocs have quickly risen to become an international phenomenon. This summer, I’ve seen these shoes being sold in the grandest of malls in Singapore (retailing at $50 Sing.), sports shops and even in large bins in Thailand ($3, although, I’m pretty sure those were just Chinese knock-offs).
Although at first they seem to be like one of those things that come out of nowhere (and disappear just as quickly, can anyone honestly recommend a buy on that stock just yet?). But if you have a look at the video, they’ve been around for a while (since 2003 at least). Just goes to show that even overnight success needs years of planning :-).
The other thing this reminds me off is Malcolm Gladwell’s book, The Tipping Point. Just how and when do localized fads become national and international crazes? Mr. Gladwell tackles these questions (and others pertaining to the Science of Fads) in an interesting way in his book.
The knock-offs I saw in Thailand warrant a whole post for themselves. Just another small example of how China is changing the world. Could the factory that produces real Crocs also be running a small, covert third shift to make a little money on the side? If they are, then what I really want to know is how much does Crocs (the company) pay for these shoes (which retail for $50)? Do they really pay low enough to warrant a third shift making shoes selling for $3? Those knock-offs were pretty darn good. Of course, might not be the same factory at all, but someone who managed to get hold of their designs. Anything’s possible, as I have been reading in China, Inc., a fascinating account of the rise of China as an economic, business and social superpower. Again, a great read.
But really, I would think the smart thing for Crocs to do would be to make sure that everyone can afford these shoes and owns a pair, rather than making them planned purchases. Make sure they’re on every feet and they might retain long-term, loyal customers who genuinely like the shoes (not just for the hip-appeal). Fads come and go. Will people still be wearing something so distinctive (read: ugly) long after everyone else has stopped wearing them, just because they weigh six ounces? The strategy should be to embed these shoes as socially acceptable in minds of people world-wide. They really need to be planning ahead, rather than trying to milk this for every penny they can here and now, especially now that Crocs is a listed company.
Just my 2 cents.
My brother, golf nut that he is, sent me this video from the 2005 US Open (16th hole, I believe). Amazing shot.
Holistically, golf is a lot like business. A lot of time is spent talking, walking, trying and thinking. But then there are moments, very rarely, when opportunity meets execution so perfectly, it operatic. Those are the moments that are worth savoring and remembering.
This shot itself is one such moment for Nike. Every penny spent on endorsing Tiger (or rather, every million) was worth it many many times over when that ball rolled to a halt right next to the hole. Stayed there, Nike Swoosh upright, for a good 2 – 3 seconds, before dropping into the hole. You can not manufacture that on TV. You can not generate that on a computer. Nikes decision (execution) to endorse Tiger was worth it many times over with just this one shot (opportunity). Although, it did help that Tiger is so damn good.
Wow. Mostly good list of the best presentations ever given. Notice how none of them consist of a guy talking in monotone to a Powerpoint slide. The presentation slide was invented to be a lubricant for presentations, not the presentation itself.
There’s some interesting stuff in here. Most of these have a business edge, but there are some classics like Martin Luther King’s “I Have a Dream”. Invaluable advise for all entrepreneurs who double as chief evangelists for their products.
Top Ten Best Presentations Ever.
With links to watch the videos. Fun fun fun!