Gigs & Bytes: The Big Apple
It’s not that Apple has some kind of lock on technology, nor does the Cupertino, Calif., computer company have a secret formula for digital dominance locked deep within Steve Jobs’ personal vault. Instead, like all good secrets, its mode of operation is out there in plain sight. Anybody could duplicate it. That is, if they only tried.
Simply put, the iPod’s success is based upon a turnkey system where everything works. Click the mouse and you’ve downloaded tracks from iTunes. Another click and the songs are on your iPod. With Apple’s iTunes/iPod combo, there’s no guesswork, no compatibility issues, no problems. If only life could be so simple.
But life isn’t simple. Nor is the personal player industry, where you have several gadgets that pretty much do the same thing. But because of industrial niceties like patents and proprietary technologies, some gadgets might work better than others with certain online music stores. Sure, there’s an air of compatibility, and the non-iPod players on the market do work with the non-iTunes online music stores. However, they’re just not as easy as Apple’s do-it-all digital philosophy.
Right now, the digital download market is divided between Apple and everyone else. On Apple’s side you have the store, digital rights management and player all under one roof. But on the other side you have multiple music player vendors, multiple stores and one digital rights management system – Microsoft’s. Its task is to make its DRM technology work for all the stores and all the players. No easy trick, indeed.
But don’t take our word for it. Napster chairman and chief exec Chris Gorog feels the same way. And he said so at the Reuters Global Technology, Media and Telecoms Summit in New York.
“Our business does rely on Microsoft’s digital rights management software and our business model also relies on Microsoft’s ecosystem of device manufacturers,” Gorog said.
He added that a major problem is that Microsoft must ensure its DRM technology works on all players and platforms.
“It’s a lot more complex to get organized properly than it is to build one device and one service as Apple has done,” Gorog told the audience. “It’s always been painful at the introduction of new technologies. But it always takes shape like it’s done in the past.”
For those who don’t want to take the Apple route to personal music bliss, the marketplace offers plenty of choices. While almost all non-iPod players are compatible with Microsoft’s DRM technology, some devices only play song files while others work with online subscription services offered by companies like RealNetworks and Napster. For the non-technical consumer who just wants to take a few tunes to the gym, picking a player and a service can be very confusing.
Or they can just go with Apple, as most people already have.
But don’t think companies like RealNetworks and Napster are ready to throw in the towel when it comes to using Microsoft’s DRM. Gorog said he thinks consumers will rock the Microsoft way within the next year or two, thus reducing Apple’s dominance among digital players and online music stores.
“A lot of people following this story in the media and investors… are really focusing on the tree and are not stepping back and looking at the forest,” Gorog said. “To date, only five percent of (music) sales have migrated digitally. We are in the very, very early days of this.”