Filed under: Analysis / Opinion
Is Apple the new Microsoft?
So claimeth Mike Elgan of Computerworld in his article on PC World: "It's Official: Apple is the New Microsoft." Well, I'm certainly glad that is settled! On to the iPhone news... Wait a moment, on what grounds does Mike base his comparison? I'll break down the points and test their coherence.Mike's first assertion is a familiar one: the iPod + iTunes ecosystem is the worst kind of monopoly, where you must use iTunes with an iPod. He says, "Not fair, you might say. Any hardware device that syncs data with a PC as part of its core functionality has software to facilitate that syncing. True enough. But operating systems have browsers as part of core functionality, too. Doesn't Mac OS X come with Safari? Doesn't the iPhone?"
First of all, his argument is akin to saying ATI has a monopoly because you have to install drivers to make their video cards work. Secondly, his parallel to browsers is nonsensical. What does a browser, a completely different app unwed to any external hardware device, have to do with iTunes or an iPod? I'm not really smart enough to tell which logical fallacy this is, but I know BS when I smell it. Buy CD's, they don't come from the iTunes Store.
Moving on to his one-line critique of iTunes: "ITunes is the slowest, clunkiest, most nonintuitive application on my system. But I need it because I love my iPods." iTunes is clunky and unintuitive, huh? Ever try SonicStage? PC World even called IE 6 one of the worst products ever. Of course, MMC plug-ins are models of intuitive design. Let's move on, shall we?
Here's a chestnut: "Can I reformat my iPod and install something else?" Yep, try a Google search for "iPod Linux" and in .21 seconds you will have the answer. It is yes. Also, let me know how often you install "something else" on a Zune.
Poor old dad is trotted out next, in a call for sympathy I suppose. You see, dad likes to go to the gym, and at this gym they broadcast the TV stations over the FM waves. Oh, but there is no FM tuner on the iPod! Well, yeah, although this argument is pretty darn old and for the 50 or so people who still care, Apple sells a FM tuner that happens to double as a remote control for the iPod. Sounds pretty perfect for your dad on the treadmill there. Maybe you should give the old man some credit. And trying to tie this in to vendor lock-in again? Maybe Mat Lu, our resident logic expert can tell me which fallacy you've invoked this time. I'm losing count.
Now, on to the ever-popular $.99 ringtones issue. Look, I hear ya buddy. But while you're at it, why not complain about the $2.99 ringtones out there? Are you just now figuring out that the cell phone industry has been ganking our gold for ages? Hm, so much for that handy "Ringtones: The Missing Manual" book you've been shopping around town.
Now here's a cute argument that really goes nowhere: "Imagine if another company were allowed to compete in the OS X media player market. These players would all drop to below $300. Don't hold your breath, though; it'll never happen. Apple has the power to exclude all others from software than runs on its media players. Microsoft could only dream of such power." Yeah, MS did dream, they called it a Zune, and it wet the bed. When MS licenses whatever ZuneOS they've got, wake me from my Tangerine Dream.
Having clearly decimated the iPod/iTunes ecosystem, comparing it to, uh, something I'm not sure of, Mike goes on to trash the iPhone. Watch and learn!
After explaining how Apple clearly ripped off the whole "touchscreen" thing from the backs of poor lab techs (which, by the way, reminds me of a story about Xerox I'll tell some day), he says, "Microsoft will ship its tabletop UI, called Microsoft Surface, in November, and Apple will likely enter this space with a 3G UI months or years after Microsoft does." Uh, first off, Apple has already shipped a product like Surface: it's called the "iPhone." Oh, it doesn't read RFID tags, but it also doesn't weigh over 100 pounds or cost 10 large, so there's that. In Soviet Russia, gadgets innovate you! Anyway, don't think Apple will be late to the party on expanding the multi-touch interface to other products. In fact, go buy Apple stock yesterday.
On to one of the biggest parallels in history: "If it was fair to slam Microsoft over Windows, it's fair to slam Apple over the iPhone and iPod Touch." He's referring to how Microsoft was called out over copying the Macintosh OS GUI with Windows, lo those many years ago, and how it's fair to call out Apple when they (clearly) copied multi-touch from... uh, labs? I still find it amazing how people so easily equate touchscreen with multi-touch. They couldn't be less similar. Also, let's keep in mind that the experience is what Apple is good at. Windows was a horrific experience in the early days, especially compared to MacOS. iPhone is a fantastic experience compared to everything else out there. Does anyone disagree? Okay, moving on.
"Jobs rules like Bill Gates never did. If you want to succeed in the digital music or downloadable TV business, you'll do things his way." Well, not exactly. Lest we forget, only EMI has dared put DRM-free music on iTMS. Apple isn't a content company. As such, they are actually beholden to the rules of the media companies. Sure, NBC/Universal is swinging a certain appendage around, and they may regret it, but if one more company were to cut from iTMS Steve is going to have little beads of sweat on his forehead.
In the end Mike says he's really an Apple supporter. I dig his attempt to critique the company. And I agree that they are quite closed. But that's like saying I should be allowed to hack my toaster. I mean, I can-- but the average consumer doesn't WANT to. Apple is now in the business of making consumer appliances. And yes, a computer is now an appliance. They aren't a monopoly by any means. If they were, there would be no Engadget or Download Squad, only TUAW. How sad would that be?
I think you're going to see Apple open up slightly in the future, but probably after Steve is gone. WebKit is a tenuous and arguably lame start, but "open" has many meanings and I'm not going to debate semantics. I think they tread the line pretty well between leaving hackers be and making a great experience. Frankly, the other options, for me, aren't appealing. But then, I'm an Apple fanboy, so whaddya gonna do? I guess you could write an article full of logical fallacies, huh?
![TUAW [Cafepress]](http://www.blogsmithmedia.com/www.tuaw.com/media/tuaw-cafepress-promo.png)
Reader Comments (Page 1 of 3)
Mo said 8:18AM on 9-08-2007
In fairness, iTunes for Windows is pretty horrible. I tolerate it, though, because it's the closest thing available to iTunes for Mac (and it has the same library-sharing and organisational capabilities).
I really don't buy the “iPod requires iTunes” argument. I *do* see the “iTunes store requires iPod if you want a portable player” argument, to an extent, but you can blow it out of the water when you consider that “iPod + iTunes” is a single product that people buy (some opt to use the store functionality, some don't), there's nothing stopping people burning iTunes tracks to CD, and that other players have their own store solutions—invariably ones which *aren't* cross platform.
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Mo said 8:18AM on 9-08-2007
Er, I should say, when I said “argument” I meant “anti-Apple argument”.
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shak said 8:25AM on 9-08-2007
'But while you're at it, why not complain about the $2.99 ringtones out there?'
but thats an option isn't it? either you buy those at $2.99 or you just use audacity or any other free audio editor and make your own for free .. as many as you like!!! then you can use those freely on your device no one will stop you except iPhone.
its not the question of $0.99 vs $2.99 its a question of restricting basic access to ringtones on the iPhone, if you need to get ringtones on iPhone there is no other way than Apple's $0.99 barrier ... (you can crack and hack and skip and jump around it but the restriction is still there .. lets not skip and jump around the question here)
Apple is next microsoft? umm I don't think so, every company has a right to make money (duh) and I agree with you at most points but I don't see how you can defend this absurd ringtone business that Apple has just brought in.
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ChrismUSAF said 8:41AM on 9-08-2007
shak- No, no, no. iToner involves no "crack and hack and skip and jump around" and it works great. Don't want to pay for that? Installer.app is to the level now that I wouldn't even call it hacking anymore. All you do is run the GUI app, and it's done. Then install TUAW's own Erica Sadun's SendSong app and you can make any song into a ringtone, right on your iPhone.
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mentalsticks said 9:02AM on 9-08-2007
I must say I've started liking Apple a lot less in the last couple of months. I just read an article just now on some website (i've tried to find it back, I can't) that Apple has started putting its own interest before their customer's (case in point was: no mail.app on the iPod touch so as not to cannibalize on iPhone's sales). I've noticed the same thing rather often lately with Apple: their products could be better with very little fuss if any. To name but a few that spring to mind: the Motorola ROKR 100 song limit, the aTV's lack of divx playback, no third party apps on iPhone (with a very lame excuse about security)..
Apple, shape up. My customer satisfaction has gone from 90 to 60% and I gather I'm not alone in that.
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David Fischer said 9:04AM on 9-08-2007
I think the analysis of a monopolistic Apple with iTunes is useful. Apple is approaching a monopoly on online music distribution with their iPod and iTunes combo. And there is strong lock-in: if you buy music from iTunes, you can (almost) only listen to them with an iPod.
THis is not the case with e.g. DVDs. You can buy DVDs from any manufacturer and play them on a machine from any other vendor. You don't have to worry about a new machine from Toshiba not playing DVDs bought from Disney.
However, the subtleties are important. Apple does not have a monopoly (yet). And there is the unanswered question of whether a monopoly in online-music distribution is truly a monopoly when music is distributed by radio, satellite radio, and CD. (But I think it would be considered such, based on the arguments for Satellite Radio monopoly being a "bad thing" even in the face of traditional radio competition)
Also, iTunes music can be legitimately burned to and re-ripped from CD and encoded for an alternate vendor's player. This is cumbersome and quality is lost. But you can leave the iPod ecosystem if you want.
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Mo said 9:24AM on 9-08-2007
“I just read an article just now on some website (i've tried to find it back, I can't) that Apple has started putting its own interest before their customer's (case in point was: no mail.app on the iPod touch so as not to cannibalize on iPhone's sales).”
Anybody who _didn't_ expect them to do precisely that has been living on a different planet from Steve Jobs for the past half decade.
Apple is obligated to serve its shareholders first, and always has been. Prior to Jobs' return, they didn't do that very well. As it turns out, an awful lot of the time serving shareholders and customers coincides pretty well. Sometimes, though, it doesn't work out that way.
What you've got is a vocal minority saying “well, I'd like all the features from this high-end thing, except maybe one or two bits I don't want, and I'd like them to put those—at no extra cost—into the lower-end product, reducing the incentive for people to buy the higher-end thing”.
Well, business doesn't work like that. If you don't like what Apple's selling, you don't buy it. If you don't like the fact that products are tiered feature-wise, it's pretty much tough: either buy a great big stake in Apple, or deal with it. Sure, you can bitch and moan, but you can do so safe in the knowledge that the product tiering is absolutely dandy for 98% of the customers they have.
Honestly, people sit here clamouring for a touch-screen video iPod, and when Apple deliver one the same people start complaining that it isn't a PDA. Say Apple were to put in all of the PDA features from the iPhone into the Touch: would those same people start complaining that you couldn't make phonecalls on the Touch?
Get real. You want a touch-screen video iPod? Buy the touch. You want a smartphone? Buy the iPhone. You want a PDA? Find a Newton on eBay: Apple doesn't do PDAs again yet.
Next up, people complaining about how their Volkswagen Tourag doesn't have the same leather interior as the Porsche Cayenne.
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dombi said 9:31AM on 9-08-2007
Did Microsoft invent the internet? No. Well, I think his argument with iTunes is not valid then.
Apple invented the iPod and they created a software and servicing built around their own device. Why wouldn't they do this? They are supporting their own device.
If Microsoft created the internet and forced everyone to use IE to access the internet, I think that might be a valid comparisong. But this is not the case.
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T1 said 9:46AM on 9-08-2007
Uhhhmmm.... guys.... did you actually *read* the Computerworld article? It's not what you think it is. Victor, please do your research a bit better next time, 'mkay?
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mentalsticks said 9:50AM on 9-08-2007
@Mo: wrong analogy. A Touarage isn't a Cayenne because the production cost of a Cayenne is much higher. Adding mail.app to the iPod Touch wouldn't cost anything. What I am talking about is that Apple is deliberately not making the best product they can at a given price point with a given margin. And believe me: when consumers (I am one) check out the competition and find out that other companies do not have the same level of artificial product diversification, then the shareholders (I am one) won't be so happy anymore.
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Dale said 10:01AM on 9-08-2007
@mentalsticks: I believe the shareholders Apple cares about are those with a significant amount of shares, not a handful they picked up on a whim.
The entire point of the iPod Touch is to act as a music player, not a fully-featured communications device. The inclusion of Wi-Fi and Safari were to allow for the implementation of the wireless iTunes music store (iTunes, as I'm sure you know, uses the same Webkit back end as Safari). Email would have been great, but not vital enough to cannibalise the sales of the iPhone any more than the device already will.
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james said 10:18AM on 9-08-2007
Referring to Apple's iTunes as monopoly on music sales is flat out bogus and irresponsible journalism. Apple is responsible for less than 10% of overall music sales, and just nudged out Amazon within this year. (Don't remember anyone calling Amazon a monopoly) They rank 3rd overall behind WalMart and BestBuy in overall music sales market share. Monopoly is a strong allegation, and one that implies a lack of choice and other anti-competitve behaviors. Using an iPod is a choice within a crowded market. It wasn't the first mp3 player, and last I checked it wasn't the highest rated or cheapest.
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Rip Ragged said 10:40AM on 9-08-2007
Interesting. A lot of people seem to have the idea that anything short of an outright charity is "the next Microsoft."
If Apple doesn't buy lunch, make lunch, wash the dishes, and daub your mouth with a cotton napkin for you, they must be megalomaniacal monopolists hell bent for global domination.
Apple is in business to (gird yourself for a revelation here) make money. They just happen to be better at it than the shoe repair shop downtown.
Every functionality Apple sells is available in some other product from some other manufacturer. Apple is still in third or fourth place among computer manufacturers. OS X, as the microsofties are wont to point out, sits on a minuscule percentage of the world's desktops. An infinitesmal percentage of iPod music is downloaded from iTunes; most is ripped from CDs. Only when all those things change significantly can the "monopoly" tag pass the giggle test.
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Clair said 10:52AM on 9-08-2007
I can only use the software which came with my scanner with my brand of scanner.
Having to use an iPod with iTunes is not a monopoly. Use another mp3 player with another piece of software.
A monopoly is not necessarily a bad thing. If a business is so successful it puts the competition out of business (fair and square), that's just too bad for the competition. Someone will have to come along, offer a product which consumers want, and knock the monopoly out of its position. However, I'm not in favor of an entity using unfair business practices to become a monopoly. I'd like to see proof that Apple is doing using unfair business practices with the ITS. Even if the ITS is considered to be a monopoly, requiring an iPod is nothing out of the ordinary for many software packages.
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Kris said 10:59AM on 9-08-2007
One. Microsoft didn't "invent" the surface. It was clearly and widely spread on the internet about a year ago. http://cs.nyu.edu/~jhan/ftirtouch/.
Making your own ringtones is easy. Download free Audacity, splice your song, bluetooth it to your non-iphone and you're done. I hate how every cell phone discussion goes straight to the iphone. It lacks a lot of current cell phone functionality, but it's masked by the RDF.
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LittleJoe said 11:04AM on 9-08-2007
@mentalsticks
"5. I must say I've started liking Apple a lot less in the last couple of months... Apple has started putting its own interest before their customer's (case in point was: no mail.app on the iPod touch so as not to cannibalize on iPhone's sales)."
Well DUH. Every car/computer company in the world does that.
Case in Point: VW limits the potential for the GTI because it would cannibalize Audi A3 sales. (Audi being owned by VW)
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manny said 11:20AM on 9-08-2007
@mentalsticks
Who needs a mail application on their ipod?
That would just make it a PDA.
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David Chartier said 11:55AM on 9-08-2007
Very well written Victor. Great piece. You need to write more often.
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Shunnabunich said 12:07PM on 9-08-2007
@manny
Yup. An 8mm-thick, sexy little PDA. Think about that for a sec.
And don't forget all the 3rd-party apps that will inevitably start popping up for it. That's half the reason I'm planning to get one: it runs OS X, for heaven's sake! It's a very small, portable, scaled-down Mac I could take anywhere. And if Apple releases an official SDK, I bet the dev community will explode. It's all speculation right now, but if the iPod touch is thought of in the right way, it could be made a very useful product.
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Christina Warren said 12:25PM on 9-08-2007
The last paragraph of that article was really key, and by merely glossing over its content - I think you mischaracterized the original author's position.
That said, I do think that it is actually apt to make the comparison between iPod/iTunes or iTouch/iPhone/Safari and Windows/Internet Explorer. Why? Because the bundling of Internet Explorer with Windows ended up being the center of the Antitrust lawsuit filed against Microsoft. Look, personally, I thought that most of the claims in that lawsuit against Microsoft were bogus, unfounded and sour grapes by companies like Sun and Novell and Netscape (which by the time the depositions and testimony actually started, was owned by AOL - making that monopoly argument laughable, even if the market share was constantly decreasing) -- and I still think its insane that by simply including a web browser with a product, an entire issue of a corporate or market monopoly can be decided /Rant.
NOTE - I'm not propagating this opinion, merely pointing out that it isn't a fallacy of logic to compare these two situations, personally, I have no problem with the practice by either Apple or Microsoft*
So if Microsoft was tarred and feathered for including IE with Windows, the analogy between that and and the iPod requiring the installation/use of iTunes if you want to be able have access to all of the features (which more than just the music store, also includes playing any files your purchased from the music store) isn't that far off. Actually, most courts would call that a monopoly, just. I personally have no problem with that, but it is what it is. And by pairing Safari with iTouch and iPhone, the issue is even more similar. Oh, but you say - iTunes is a better product for managing the iPod than almost all of the competitors, especially on the Mac -- and hey, I totally agree -- but making a better piece of software didn't help Microsoft. Yes, IE 6 SUCKED, but IE 6 wasn't the subject of the lawsuit, it was IE 4 and 4.5 -- and that was a very, very good product. I have always believed and will always believe that the reason Microsoft won the browser war was largely because from IE 3.5 onward, they made the better product. Netscape 3.0 and maybe 3.5 was the last time the Netscape name had any advantage whatsoever over IE. There was just not contest between Netscape 4 and IE 4 - IE 4 was far and away superior - and let's also remember, Netscape was charging up to $60 or $70 for their browser until Microsoft's free approach forced them to do the same thing. Today Microsoft is gradually losing market share for its browser, again, because FireFox has the better product - obviously the installed base is larger than the IE/Netscape war, so it will more difficult for IE to become irrelevant as quickly as Netscape did (though in a backward way, FireFox IS Netscape, but I digress), but if FireFox gets better and IE doesn't improve, it won't be that way forever. And at least Windows didn't prevent you from installing another browser. How easy is it for the laymen user, you know, someone who isn't interested or able to hack their iPhone, to make FireFox or Camino the default browser? I ask because I do not know - if it can be done, that's great. Hey, if it can't - I don't have a problem with it, but from an analogy standpoint, it bolsters the Computerworld guy's point. Even if it can be done, that doesn't change the legal issue that was used in US v. Microsoft because any other browser could be installed on Windows and even be the default browser - but the monopoly charges were still stated because the argument was that most users wouldn't actively look for another browser if one came on their desktop. OK - well, that same argument is more than apt for iTunes - just because a handful of other software audio players can play iTunes protected files (and that requires QuickTime to be installed, making the whole fact that IE wasn't technically removable moot) doesn't mean that iTunes/iPod isn't a monopoly because most users will never look for an iTunes alternative if provided with one.
As I said, I don't think either of the two companies are monopolies in a way that is negatively affecting the free world (OK, Microsoft might be guilty there, but I'm talking about the US antitrust case, not the international legislation) or even impeding development of good products - but in a legal definition, as decided by the courts - yes, both are monopolies of their respective industry. Apple of digital media players and the digital sales that go along with it (iTMS is only 10% of all sales NOW, but it's like 80% of all digital sales and is pretty much the defacto online distributor) and Microsoft with its Operating System.
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