The Evesham MiniPC Plus

A succinct review of this new machine is to be found from Trusted Reviews via The Register

Why mention it here? Well, read on....

The first two pages of the review appear to indicate that we have after 11 months (or 12 as it is not on sale until January according to the Evesham site) something that is a real competitor to the Mac mini. I was particularly surprised that they have replicated the Mac's ports pretty much exactly - 2 USB ports and one Firewire. Surprised? Well, firewire is less common in the Windows world, and 2 USB ports is pretty low by most standards. Apple do not target the Mac mini as a media centre device - though it is used by many of us that way. On the other hand, Evesham markets this specifically as a Media Centre device. Used in this way, you will almost certainly need both USB ports - one for a tv tuner, the other for a surround sound output. Even then, try connecting up an mp3 player. So, in the case of the Evesham machine where does the keyboard go? Unfortunately, there is no bluetooth option available (that I could see), so it seems it's one port short right away. A more logical approach would surely to have put 4 USB ports on it, and drop the firewire - probably a similar price in all? Apart from the mention of it being somewhat noisy - something the Mac mini is definitely not, at this stage in the review, the machines appear very similar indeed.

However, turn to page 4 of the review and it is clear that this is far from a competitor. The price is an astonishing £699 inc VAT - 40% more than the Mac mini equivalent. In the case of the Mac mini, that model has Bluetooth AND wifi installed (only wifi is an optional extra on the Evesham). The mini also includes a dedicated GPU, and, as mentioned, is much quieter. Software-wise Apple's iLife apps are considerably more advanced than anything offered on Windows today, and arguably Mac OS X 10.4 is more advanced than current Windows XP (and the Evesham will be constrained for running Vista given it's graphics architecture).

So, you may ask, I'm still not sure why this is relevant to what you normally blog about and why you're bothered by a review of a me-too copy.

Well, I think it is notable because it demonstrates to me clearly a problem that Apple is having in perception of it's (computer) products - most particularly that it is expensive. It has taken one year to have an off-the-shelf direct competitor to the mini (rather pathetically mimicking it in fact). During this year, I have heard over and over that even the Mac mini is expensive for what it is compared with PC products. Yet when a PC comes along that allows you to tick most of the same boxes, it's 40% more!

The issue for Apple is that there are hundreds of makes and thousands of models of PC available and that choice allows people to select a model that does what they want at a price point that they want. Want a cheaper laptop than anything Apple makes? You can find them by the dozen. Want a cheaper desktop than anything Apple makes? Loads of them. It's simple to ignore the models that are higher priced than Apple. Conclusion? Apple is expensive. And that's what sticks. I can see Apple doubling their market share over the next few years. But if it is to considerably exceed 10%, it is going to have to lose that perception or do a lot more to educate the masses as to what it's value is about.

Intel Macs - Myth and Reality

It takes a brave man to go out on a limb so close to MacWorld and contradict rumours that are already considered facts by some of the mac faithful, but Paul Murphy at ZDNet has recently done just that. I'm not sure I agree with all that he's written. But I think he makes some excellent points in the article, which are worthy of serious debate (more so than a recent column suggesting Apple ditch Intel and move to Solaris/SPARC).

In a series of articles here between now and MacWorld in January, when all (well at least SOME) will be revealed, I'll be taking a look at some of the things that have gone from guesswork to firm predictions to expectations, without a single machine being released. I think expectations for this particular MacWorld are now running way ahead of anything else I've ever seen for Apple and indeed perhaps for any technology company ever.

Myth or Reality #1: TIMING. Intel Macs will arrive much sooner than Apple promised. Interestingly, I've seen conjecture for just about every Mac computer to be in the January announcement even though the transition was not expected to be complete until end of 2007. I have seen mention of Mac mini, iMac, iBook, eMac, Powerbook and even XServe for immediate release (missing is the dual core PowerMacs).

Myth or Reality #2: PRICING. Intel Macs will be cheaper/substantially cheaper than current Macs. A number of people believe that moving to Intel will allow Apple to suddenly become much more price competitive. Dell will be in the sights. We can expect equivalent Apple machines to today at $399 levels for instance, $599/$699 for laptops.

Myth or Reality #3: PERFORMANCE. Intel Macs will blow away existing PowerPC Macs in just about everything. PowerPC Macs will be immediately obsoleted. Even with Rosetta (the emulation software required to run PowerPC applications), the Intel Macs will still outperform current machines.

Myth or Reality #4: FUNCTIONALITY. Intel Macs will do so much more. A new Mac Mini will be a full-featured "media-centre" machine using FrontRow software serving HD content to one or more display devices, acting as a dual channel Tivo-like device for TV (choose from cable, satellite, digital, analogue), video-on-demand downloads from the new Apple "locker" while streaming music to multiple locations, syncing your family iPods, oh, and running Windows at the same time...

Now, I hope that by bringing these all together, you can see that it certainly doesn't add up. Some of these myths are incompatible with the others. I'm going to be sticking my neck out looking at each of these areas and trying to take an (educated) guess as to which ones will be myth and which ones reality.

All Apple have said (of note) is that the first Intel Macs will become available by June 2006, and that the key driver was performance/watt. What I will say at this point is that come MacWorld, the Steve Jobs Reality Distortion Field is going to have to be operating in Hyper mode if there are not to be a large number of disappointed people, because Apple cannot and will not deliver on all of these areas. Which areas they do choose to focus on will be fascinating. But what might damage their reputation is NOT a failure to deliver on what has been promised, but a failure to deliver what the rumour sites have collectively ramped up as nothing less than Apple freeing the consumer from the tyranny of every technology or industry - insert your choice(s) of Microsoft, Dell, Sony, Music industry, Hollywood, Cable - they don't like at an affordable price.

Stay tuned....

Bad Journalism #1 - BusinessWeek

I came across this BusinessWeek article late last week.

Now, I've had a few instances of this lately which are really getting me quite angry. With a scientific background, I am trained to think about proof. Proof can come about only through thinking about all possible scenarios. The worst science happens when a scientist has a single minded viewpoint and designs the experiments to prove that single viewpoint, when in fact the experiments should all be about disproving that.

Now, rightly or wrongly I expect similar standards in journalism - at least in what I consider to be the "quality" papers. I recently had a run-in with the Guardian when their long-time anti-Apple columnist Jack Schofield concluded that it was Apple's fault that Microsoft's XBox360 - while interfacing with the iPod - could not play music in the iTunes Music Store format. His evidence? A comment by a Microsoft person saying that they wanted to work with Apple but couldn't. The comment was not an original comment - it had been picked up from another article. Because Jack had failed to get a comment from Apple, he assumed that to be the truth. When queried he became quite defensive about this all being due to Apple's closed ecosystem, that they were unreasonably demanding 10% of all revenues for iPod accessories, and that they were monopolistic (and good ole' Microsoft was not). I pointed out that Bose, Alpine and others did not pay 10% to Apple for their product sales - just some percentage for adapters. Since then, I've noticed Pioneer and Denon hifi equipment with direct support for the iPod - including iTMS format material. My point to Jack was that he did not know enough information to blame one side in a business transaction, and that he was peddling one party's propaganda in this. What he could have said is that "it is a serious shame for the consumer that Apple and Microsoft could not agree how copy-protected music could be played via the XBox". I don't think I got anywhere. (Ironically, the Guardian runs an excellent "Bad Science" column - a pity they don't apply it to technology stories too).

And so to this article in BusinessWeek. The premise? That Apple itself is what is holding back the online music business. Full of quotes from Apple competitors and the music industry yet devoid of quotes from Apple itself. The article has an hypothesis - something that might get people's attention because it's controversial. But really the article has more holes than Swiss cheese.

Lets look at one bit of logic. Online music sales in the US appear to have plateaued. As the iTMS has the primary market share for this area, then clearly it is Apple that must be doing something wrong. Sounds plausible, doesn't it? Except it can't be. Apple does NOT have 100% market share. There are others in the market including Real, Napster and Yahoo. Some of these are quite recent entrants with aggressive tactics. So, if Apple is doing something wrong, surely these guys would be picking up the slack? Even if you take the iPod owning population out of it, there's still 25-30% non-iPod that would be buying more if it was just an Apple problem, surely? It could be true if the Apple store is actually LOSING market share so that while the overall market is flat, Apple's competitors are gaining. This possibility is ignored, so draw your own conclusions.

So, what reasons are put forth for the plateauing? Ah, it's the fixed price argument again. The article mentions that the labels have pressured Apple for variable pricing - essentially cheaper for older stuff and more expensive for newer stuff. To back that up, the article quotes a user as saying that he would buy more older music at a lower price. Duh! If the labels were arguing for a lower average selling price per unit, then this all makes sense. But it is quite obvious that they are not. Sure they want variable pricing. BUT, they want that with the AVERAGE price UP. Why am I so sure? Because it is Apple that has fought for the low fixed price (99cents). And it is Apple that has fought to maintain that. That's one reason. But let's looks at some others. If it was about variable pricing, the labels are free to explore this with other music stores are they not? And what has happened? Nothing. 99cents is basically as cheap as it gets. So, either the other stores agree with Apple, or can't afford to discount. Factor in the widely-held theory that Apple does NOT make money from the sale of music, it merely covers it's costs. So, why would Apple object to a reduction in pricing for online music? The point is they wouldn't - if there was an overall reduction. And that is how you conclude that what the labels mean by variable pricing is NOT what the consumer wants to see with variable pricing.

And it's worse than that. What Apple understands is that simplicity counts. Today's model is simple and easily understood. For consumers to grasp variable pricing will require a considerable cut in the average selling price or some other attractive offers. BusinessWeek attempts to head off some of these arguments by suggesting that Apple is sold out of iPod's so doesn't need to sell more music online. It even suggests that the labels will look beyond Cupertino if this doesn't correct itself soon! Really! Give me a break. Apple set out to make relatively little from the iTMS. But to artificially limit what it sells makes no business sense. They want people to buy as much as they can from this store for obvious (and selfish) reasons. And the labels should in fact be wishing for more partners like Apple who are prepared to forego profitting from online sales (of course, they're not happy with that - they now want a cut of the hardware sales as well!).

I sometimes wonder if I am representative of the general population. And on the point of music purchases I am to a degree and am not in other ways. I have a stack of vinyl I've never replaced. At a certain price point I would replace most of that via online. At a higher price point I'd replace SOME of it. And, as it is today, I've replaced none of it. (Given that I am an audiophile is the issue that makes me less representative) There are other artists I'd like to experiment with, but on an album pricing basis, I just won't do that. This year, I've tried a few things, mainly because I can now get new release CD's for as little as £6.99 via CDWow, and indeed very rarely need to pay more than £7.99 (that's about £1-2 less than a year ago via Amazon, and about £4-8 lower than a few years ago via shop). I prefer to get the physical item. It is a no-brainer that manufacturing/distribution costs for online are drastically lower than physical, so why am I still being asked £7.99 (and indeed more these days) for stuff online? Is that Apple's doing? I don't believe it is. I cannot see any reason for Apple to keep prices high. But the labels have a long history of hoping they can get a higher price. At this time, Madonna's album is £7.99 on iTMS and is number one. The Robbie Williams album is £9.48 and is not in the top ten. I can get Madonna's CD for £6.99 and Robbie's for £8.75 delivered from CDWow. The only question I've got is who is buying Madonna's album at £7.99 then!

So, why exactly am I going to buy a copy-protected, lower quality recording, that can't be resold if I don't like it from the Apple iTMS for MORE money than a physical CD? If that "more" was going to Apple, then I'd blame Apple. But we know that "more" is NOT going to Apple - quite the opposite. The record companies are making MUCH higher margins on the online sales at these price points. What is undermining their business models (among other things) is the global economy. They cannot exercise their geographic powers the way they used to when global logistics can correct the imbalances. Likewise, they have no long term geographic control over online. The geographic monopolies will crumble. The issue isn't VARIABLE pricing, it is about LOWER pricing. Especially lower pricing for older stuff that online delivers EXTREMELY economically. And lower pricing for new stuff too - at least at an album level. What happens when prices come down? Sales go up. And when cost of sales is very low (as it is in music) then profits rise that much faster. How many businesses has this been shown to be true in? Yet the labels consistently think these business rules do not apply to them.

I recently came across the usual intelligent comments at Ars Technica on Spitzer vs Sony. Towards the end is this gem of an insight...

....but it sure makes customers mad, and mad is good. One of the things that music execs want to accomplish in the short term with their DRM strategy is to put pressure on Apple to open up the iPod and its Fairplay DRM. The thinking (if you can call it that) apparently goes like this: angry customers can't rip a CD to their iPod and fire off a nasty note to Apple about how unhappy they are. Apple then caves, licensing Fairply or agreeing to support Windows Media. As one label executive told Variety, the hope is that when the great unwashed masses find themselves thwarted by DRM,
"Maybe they'll send Steve Jobs an e-mail."
Sony wants to turn its customers into a pressure group that will generate enough smoke and heat to crack Apple's stranglehold on the iPod, and DRM is one of the tools they're using to get the job done. It sounds strange, but does Sony want their customers angry?

What BusinessWeek has done by failing to peel off a layer of the onion and really investigate what is going on, is to become a mouthpiece for the labels' propaganda machine (and Apple's competitors to boot). The labels have a hero in Apple, but a hero they are worried has already turned into a monster. Once again, they are retreating from the real world into their imaginary world in which (they dream) the customer will pay more for their product, will re-pay every few years or so when the format changes again, and will be happy to limit their uses to those the labels deem acceptable (heh, I bet many of them think you and me should be buying BOTH a physical copy AND a digital copy!). I will be covering in a future article what things they COULD be doing to make the most of digital. Instead, they are using everything in their powers to mimic their past, slow the change, and paint the proponents of change as the bad guys. Headlines may sell papers, but over time consumers expect more from what they read. It is very simple to see. The online market does not belong to Apple (though it may be dominant), and the overall music market certainly does not. The labels know this, and an investigative business-oriented newspaper should too. The labels will have to deliver far more to the online buyer. That can come in partnership with Apple (and others), but must be driven by the labels. BusinessWeek should know and write better.

Apple DVR - not!

I wrote a couple of weeks ago about the rumoured Apple DVR.

Yesterday provided another data point on why this will NOT happen - at least not as a complete Apple-branded product.

Variety carries some comments from NBC Universal President Jeff Zucker, focussing on their new deal with Apple for TV content. I particularly liked this gem commenting on moves by Tivo and Echostar:

"This is clearly not the proper way to behave," Zucker said. "We have worked in concert with Apple to benefit the consumer; where others are not working with content providers is clearly not in the best interest of the consumer"

So, Apple's head is clearly focused in one direction, and they will not do anything to undermine that at this stage while maximising participation of the content providers. Of course, you can get your programs free too - just use Elgato EyeTV or other devices from companies like Miglia.

Xbox360 and Class Action

Some of you may expect me to gloat on the news of a Class Action suit forming over XBox heat problems.

Well, I don't wish those sorts of things on my worst enemies (oh, ok perhaps Sony deserves one or two over the rootkit debacle!). This class-action-as-soon-as-I-have-a-problem is one of the worst things about our current society (well, the US one that is, but we have it here in sorts, and it will only get worse too).

Does MS not offer a warranty? Has it refused to honour that warranty? Just what percentage of units were defective? Has anyone's house burned down? While I reported on the heat issue with the XBoxes on this site last week, it does not seem that it is massively widespread, and while MS is not going to stand up and explain to the world (it doesn't have to), I've not heard big complaints about its handling of any XBox issues (except the shortage!).

Class action lawsuits do not benefit the consumer. Anti-trust actions do not benefit the consumer - they benefit the CURRENT shareholder of the company that wins (not the shareholder/employee at the time of the anti-trust actions). The only true beneficiary is the lawyer(s). And of course, that applies to the defense lawyers too! For instance, in all the EU action against MS, not once has there been mention of the consumer getting recompensed for being ripped off by the anti-trust practices. And in cases like Real vs Microsoft, why for instance isn't Apple also recompensed for losing out similarly with Quicktime (because they didn't/couldn't sue?). In an ideal world, one company would have succeeded reaping the profits (legally) or there would have been intense competition and no one would have made much. In this case, the consumer pays for the illegal-monopoly, and then sees those illegal gains distributed to the other protagonists. With class action lawsuits, we also lose out. Innovation is held back and the status quo is preserved, and the lawyers take it all.

Most products (cars, bikes, pvr, software, etc) I own have some flaw with them, yet only the massive hits are big enough for the lawyers to get their teeth into. We benefit as consumers from rigorous consumer rights laws that entitle us to get problems fixed and money back when something is not "fit for purpose". The law is already on our side. But we consumers also have a responsibility to investigate what we're buying too - that it fits our needs and expectations. If we don't want to chance, we don't buy something brand new. If we like something (despite it's flaws) then we recommend it. If not, we tell people why not. And only if a company has patently and severely broken the trust we should expect in them (eg the Sony Rootkit fiasco) should we need to resort to more serious measures. Wake up consumers of the world and exercise your buying power responsibly.

Firewire's even more on the way out

Back in October, I blogged that Firewire was finished. It's a subject that upsets loyal mac users because it's a technology (like Newton, SCSI, etc) that we BELIEVED was great and that we also shelled out hard-earned money for (drives, camcorders, iSights etc). I was led to my conclusion by the omission of Firewire from the newer iPod's and also an excellent article by James Wiebe posted on the WiebeTech website that I linked to in that blog entry above.

Today, I was contacted by someone I've never met, but feel I know well as a friend through countless interactions on one or more forum sites. He mentioned that the new iMac uses a USB iSight camera rather than a Firewire one (thanks Bosie!). While there could be many reasons for that other than the imminent death of Firewire (and let's face it, does it matter?), I then came across Jason O'Grady's blog at ZDNet. He is also addressing the Firewire-death thing and refers to rumours that the new Intel Macs will not sport Firewire.

Coincidentally, I had been postulating this as I struggle to work out how Apple will introduce Intel-based Macs alongside PowerPC-based systems - a topic I'll come to in more detail in the next few days (like the DRM stuff I promised which remains undelivered!). It seems to me that one way to avoid cannibalising the high-end lines is to remove "Pro" features from the consumer machines when something else (USB) is good enough. And, it also helps to squeeze a few more $ from the manufacturing costs of these machines (and cost is going to be a BIG factor in how they are judged).

While a pro-user today (in the old Apple sense of the word - a graphics/media person) may still require Firewire for sometime longer - like they did SCSI, the rest of us will have to make do with just USB which despite it's VHS comparison to the Betamax Firewire is probably good enough for what we need in the home/office environment. Of course, in the PC world, it would continue as a legacy port alongside Parallel ports and 3.5" floppy disc drives. But Apple doesn't believe in legacy ports. They balance a fine line between jumping to the new and upsetting their followers. I understand why they do this, but I'm not sure everyone is so forgiving.

So, Apple, for everytime you all gloat on how well you've done with the iPod, hark back to those things you haven't done so well but were sure they would be a huge success. You learn more through the humbling experiences than the triumphs everytime. And don't ever forget you've had a few humbling experiences in your time!

Footnote: For those who haven't followed this, USB will not completely take the place of Firewire. USB will be for lower-end devices; SATA is developing to satisfy the higher-end needs such as large storage and super-fast transfers that Firewire800 and future developments could have probably matched

The first "iPod video-killer" headline

It's taken longer than I thought, but this is the first one I've seen (over at the Register).

Not surprisingly it's the folks at Creative that are behind this - the Creative Vision:M in 30GB capacity with a 2.5" LCD at 320x240, just like the smaller iPod-thats-not-called-video-but-happens-to-do-it model.

So, let's take a quick look at the rest of the specs (courtesy of the Register again).

Ah, it's a mere 122mm³ in volume. Just 75% bigger than the equivalent iPod and only 38% bigger than the 60GB iPod. Edit: I've seen sites already mention it as the same size but 2x thicker as if somehow 3D doesn't count!

It's 22% heavier, and still 5% heavier than the larger iPod.

It MAY have an FM tuner which MAY work in your country (or not).

It has a new dock-type connector (but not too many accessories available today, and hard to see how this could overturn the burgeoning 3rd party iPod market).

It plays more types of video than the iPod but H.264 which is the accepted format going forward is not mentioned. Only H.264 can give excellent video capacity.

It may have better battery life than the similar capacity iPod (could we have independent verification of battery life please someone?), but not over the larger capacity iPod (even though the Creative is physically bigger than that). Edit: In fact, I've read that it has 11 hours audio playback - less than the small iPod. So something gives. Possibly the video playback figure is only with simple low-compression files? That's why we need consumer standards here.

It may be available in mid-December in a few countries, just 2 months after the iPod.

It will be priced in Japan at the equivalent of US$329 a mere 10% more expensive than the iPod.

As far as I know, there is no direct downloadable content available for it either as music videos, short movies or tv programming. But someone somewhere will do it won't they?

So, what exactly is "killer" about this one? Well, in addition to black and white, it will be available in Green. Way-to-go, Creative! Those designers of yours have really excelled themselves this time round.

(And, just when are the media going to give up on this "killer" label just to get something noticed? Perhaps they should put something in a pot for charity everytime they use it, and just get their money back the very very rare occasion it comes true.)

Opening up Comments

Those of you who've visited here may have been put off making comments because it required registering. A new setting (at least I think it's new) allows me to moderate posts. So, I have turned this ON, and turned OFF the need to register.

I have also turned on a feature that requires the commenter to input characters they see - called "word verification". While this may be superfluous given the moderation feature, it reduces the chance I'll have lots of spam comments. Let me know if this is too onerous.

I promise to moderate only spam or offensive comments. So if you've got something to add/correct/disagree with then now you've no excuse! We'll see if we can get some informed debate going.

I've now been doing this blog for about 4.5 months. I'd really appreciate some honest feedback on the blog as a whole? I know my writing isn't especially good and certainly not succinct (I'm trying to improve), but do you find the subjects interesting? Has anything helped you look differently at a subject? What would you like to see here? Do drop me an email directly, or comment here if you wish.

How important is this?

Over at Ars Technica today are two interesting articles. The first is the usual high-quality review - this time of the XBox360 by Ben Kuchera.

The second article is a provocative piece by Ken "Caesar" Fisher on why Apple won't be producing a DVR anytime soon. There are a lot of comments on this piece too, should you be interested. Many of the comments give some interesting alternative views too or further back up Ken's take on it.

Now the latter is a subject I'll cover more soon (yawn) as anticipation builds up uncontrollably towards MacWorld 2005 in a little over 6 weeks time. On balance I agree with Ken at the moment on this, though I don't agree with all his reasons. But I particularly think the timing isn't right for a DVR built-in. Ken only considers US requirements which themselves are problematic (wait for CableCard 2.0 for instance). European and other markets have yet more options which makes it hard to satisfy everyone with one technology. (And, for those that want DVR, it is available via various 3rd party devices that will meet the needs of the differing standards/markets especially if FrontRow is extended to support/integrate with these).

But let's say that the other speculation (primarily from Think Secret) he refers to IS close to accurate - an Intel Macmini with FrontRow, and possibly the video-capable AirportExpress2. This will clearly be Apple's play for the living room and convergence. And that's why I linked to the other ARS article. Because the XBox360 is a key component of Microsoft's strategy for the same market.

Now it is clear that for the most part the XBox360 is getting pretty good reviews as a gaming machine and indeed the XBox Live features may turn out to be very compelling indeed for gamers. And, no doubt this will be a huge market. But, apart from the poor DVD playback and the aesthetics (which I personally find awful, though others don't), there is one key point I'm reading consistently about the XBox360 which makes me question it's suitability for the living room environment. It is clearly dealt with on page 5 of the review (wow, did you see the size of that power brick on page 1?). It is the heat and the commensurate cooling requirements of this machine. I wonder how many living room environments this will be suitable for?

On the other hand the mini (today) is so incredibly quiet and cool. Sure it won't do the things it needs to as a complete media centre hub (though I'm pretty happy with it as a single room device serving DVD's, Live TV, Recorded TV, Music, Photos and Web). It is equally at home on display or tucked away in relatively small cupboards. I would be surprised if Apple compromised these aspects of the mini with the Intel version.

And here's where I'm leading. On the one hand we have the XBox360, the first MS product built using the PowerPC architecture. On the other, we have the Mac mini, the first(?) Apple product to be built using Intel technology. A complete volte-face for MS AND for Apple. Now, the mini is as yet unannounced, and we have only conjecture. Is it a case of the grass looking greener for either vendor? I don't think so. But, it is becoming clearer to me by the day how important Steve's points about the performance per watt he made when announcing the Intel switch.

If you're a gamer, or you have family members in the house who are gamers, then perhaps the XBox360 is the right device. But if you're looking for the "iLife on your TV" experience (music, tv, videos, iPod integration, photos) then the mini is likely to be a product that can be more easily incorporated in many homes. If Apple can deliver on an "extender" product too (eg the VideoAirportExpress) - one each required for each TV in the house at a reasonable price point, this becomes a much more compelling argument for most people than hot XBox360's in every room.

Now, there are other factors, to which I'll return soon. Chief among them are price (remember the XBox is essentially subsidised by sales of content, the mac will not, so XBox will appear cheaper); MS intertia (MediaCenter sales alone exceed total Mac sales); and DRM/Content provision - limiting the scope of what can be done officially and unofficially with a media centre. These are pretty much stacked against Apple today.

But Apple's switch to Intel is starting to look like a truly inspired move.

A Letter to my MP

I cannot begin to explain how strongly I am opposed to the news of the music industry pressuring the EU for modifications to data privacy laws to be enacted so that it can go after music "pirates". I have written the following letter to my MP today, and urge anyone else with strong views to write to their own MP.

Dear Martin
I have written to you before on a number of issues, and wanted to write to you again in response to the news I have read concerning the CMBA group's lobbying of MP's to ensure recently enacted laws supposedly for fighting terrorism are extended to help it eek out music pirates. An article on this can be seen at
http://www.theregister.co.uk/2005/11/25/data_retention/
However, this has been written up in many other publications.

I buy my CD's (and a few pieces of music online at legitimate sites). I oppose music piracy however it is done. Yet, I am vehemently opposed to this move, and trust that you will do your utmost to oppose such creeping 1984ism.

Apart from the fact that the music labels themselves cannot be relied on as honest corporate citizens (example: please witness Sony BMG's recent techniques which installed a serious security flaw onto honest peoples' personal computers - link available if you are not aware of this), the idea that our personal liberties which we value so highly can be given up to any corporation is outrageous. To piggyback it on legislation brought in ostensibly to fight terrorism is to undermine that entirely. Those of us who support such (anti-terrorism) legislation are made to look fools when our key defence of the loss of freedom is that the laws are only being changed for the most extreme reasons.

The labels are keen to make out that piracy and terrorism are somehow linked. And indeed in the CD pressing plants of Asia, there may very well be some financial links. But what the CDMA and it's sponsors are about has NOTHING to do with this at all.

The major music labels operate an effective cartel that under-delivers to the consumer given recent technology advances. They already seem to receive protection within the EU despite the single market laws (where is the single market in online music for instance?). Governments do not need to hand them down additional powers when the consumer would in fact benefit massively from a more open market in copyright material distribution. There are plenty of companies who would be willing to help out in this if they were not prevented from doing so by this heavy-handed cartel/oligopoly.

But irrespective of personal views on music labels, we must be vigilant that in the fight against terrorism we do not let things in through the back door that permanently undermine the freedoms we have taken so long to win. This is a prime and clear example of that. If we allowed the labels wishes - even with a good reason - then who else would we allow?

Please let me know what position you will be taking on such legislation.

Kind regards
Ian

I will be returning to the issue of DRM in this blog over the next few weeks with what I hope will be a series of in-depth articles. In the meantime, please make sure - if you're an EU citizen - that you voice your concern as loudly as you can with these attempts to hijack our freedoms.

E=mc2 100 years old

Thanks to the BBC for pointing this out.

"No equation is anywhere near as recognisable as E=mc^²"

I actually find it quite amazing it's a 100 years old, and in a way, it is questionable whether we've really (as the human race) built upon this in substantial ways. Obviously there have been the civilian and military nuclear developments either good/bad or bad/bad depending upon your point of view (well perhaps there are SOME who believe it's good/good!). But perhaps most disappointing IMHO is that I somehow imagined this as a foundation for space travel/exploration, and on that front we seem to have stalled (of course, some might say, the equation actually explicitly highlights the limits of what we can do rather than the potential of what we might do).

For those wondering why I post on this - well I am interested in this, and I named my company after it (despite a little skirmish with the bastard lawyers from a large enterprise storage company, who themselves were by no means the first).

Anyway, Cheers Albert.

Hoar Frost - another neat nature trick

I came across an interesting specatacle at the weekend - a hoar frost. I think what I saw was a particularly good example. Unfortunately I had just my camera phone to snap it with, so the images are to say the least a little poor (but better than no phone at all!). The linked-to snaps though at least give you an impression of how amazing this is.


Apparently, a hoar frost is a result of particularly unusual circumstances - when the object of the frost is colder than the air temperature, but both below freezing (usually near freezing though). Essentially, as I understand it, what makes it unique is that the water goes straight from vapour to solid form rather than via the dew stage. It therefore has a much more crystalline appearance (needle-like in this case and all in one direction off each branch as if windswept).

As you can also possibly pick out, the crystals would form along the whole length of each branch - not just in spikes. This is shown particularly well on the shrub photo.


It was also quite a spectacle to see them falling from the trees later on - like snow falling off but more painful if hit - typically one large part of a tree at a time. We had perhaps a 2" layer of crystals below the trees which shows just how much ice had formed in such a comparatively short time. Interestingly you could go half a mile in any direction and the frost was not a hoar frost, so this was very, very localised. So we played Sunday tennis as usual when I would have expected that location to have an even more severe frost.


This photo shows the crystals after they had fallen from the trees onto a table. Some of the crystals were considerably longer than 1 inch (25mm), yet they came from a branch perhaps just 5mm in diameter!

Why do you do these things, Apple?

I had been thinking about connecting my iPod to the tv set, but understood I needed a special cable. Being the mean bastard that I am, I didn't get one right away. Then I read about a tip that shows you can use almost any 3.5m to 3xRCA video cable - eg ones that come with many video camcorders. I had an old one, plugged it in to my tv via a scart converted (which also had a 2-way switch for some weird video setting), and it worked first time. The trick? You have to use the RED-ended cable into the video in on the TV, not the yellow-ended cable that is considered the standard for video. I'm assuming the yellow-ended cable is used for the right audio channel that the red-ended cable is usually used for (but haven't tried the audio out bit yet)!

This seems a bizarre design choice first of all (why not use the standard), and it also seems bizarre that they didn't advertise this fact if they did have a reason to design it that way. Do they really need revenue from the cables that badly? Some people have been put off by the need to buy an additional cable, yet possibly already have one in their kit!

Sorry I don't now have the original source for the tip, but there are plenty of them out there on places like apple discussion boards now.

It's these little things that get us all mad with Apple once in a while, but it's only a lovers' tiff!

iPod video impressions

Not going to do a full review here of the iPod 5G (video). But I did want to make a comment on something that had been troubling me before getting one. That is the video resolution - especially of the H.264 material as available on the iTMS. I had thought that 320 x 240 would be quite poor when presented on a TV. But in fact it is surprisingly good. And the file size is quite amazing - perhaps only 4 times the size of a music only file of the same length.

Personally, I prefer the larger resolution of mpeg-4. That's because I wish to use the compressed video on my Powerbook and Mac mini, sometimes connected to a projector or plasma screen. mpeg-4 specs for the iPod appear to allow resolutions such as 512 x 400, which scale better for the tv. They also can be created faster. The downside is the file size - perhaps 2-3 times bigger than a corresponding H.264 file (about 10MB per minute at that resolution and a 1200kbps bit rate).

So far I've bought one music video from the iTMS - and that is good quality both on iPod AND on a bigger screen. I've ripped a couple of music dvd's I own onto it. Takes a bit of time and some messing around,but once the settings are correct it seems to work quite well. Quality is also very good, though I've had problems with sound on one dvd when the soundtrack was type LPCM(?). That's a bug with the handbrake application I've tried for that (otherwise a great app). I've also converted a couple of TV shows from my EyeTV library. I had to convert these twice - once into DV, then into mpeg4 using ffmpegx (couldn't get H.264 to work on this). EyeTV does allow creation of iPod files (I also have a new beta version which makes the setup easier) but this doesn't work yet properly with H.264 files, and the mpeg 4 files are disappointing in quality. The episode of Extras (Les Dennis) I converted is just great (and very funny indeed). This is definitely fun, and we're only just at the start.

I'm pleased that my initial reaction to the resolution was overblown. Sure it would be nice to have full HD resolution at a file size of 20MB per 5 minutes too - and the music videos in that format for the same price. And I do wish the photos would show at higher res when connected to a TV. But we can't have everything (yet). If you haven't seen one yet, you really should!

Amsterdam - City of Bikes

I had the pleasure of a weekend in Amsterdam. It is a city I visited several times on business trips but never really SAW it. So, it was nice to get the real experience.

I have to say it is a pleasant city indeed - nothing as amazing as say London, Paris or New York, but a pleasant capital city nonetheless. Schiphol airport is quite efficient indeed, and the transport into the City quick and cheap. The City seemed safe, and very cosmopolitan - food from all over the world of all types on offer. Like Kyoto which I visited a couple of years ago, it is somewhere I could be quite happy living for a period of time. What it has in common with Kyoto is the bicycle (those who know me, know this as another of my interests which I should perhaps cover more here?).

I had never noticed the EXTREME of bicycle use on my business trips, but this time I did. It seems that a huge percentage of the population travel around the city by bike - generally low-tech bikes. Almost nobody wears a helmet including the many children cycling by themselves or on parents' bikes. The city has been designed with the bike in mind. Lots of proper cycle lanes, special lights which aid the cyclist rather than slow them down as in London. Rules which are meant to help the cyclist, not hinder. When cycle lanes are on pavements(sidewalks) they are done to make it faster for the cyclist not to get them out the way of the car as in the UK. And in doing all this they make the cars more alert to the cyclist - eg allowing cycling down one-way vehicle streets makes the cars a little bit more circumspect.

It's not perfect of course, and it's size and other features mean such methods may not transfer so easily to a place like London, but it was very encouraging to see. Contrast that with the attitude to biking here which is more and more rules to deter cycling, and to slow it down. Possible laws on helmet use are a true disgrace and show a complete lack of understanding of the situation. If helmets really helped safety, would we not see an outcry from the Dutch people about the high death rate from cycling there? What happens is that motorists see that cyclists have helmets and drive less carefully. And cyclists with helmets take more risks (I have to laugh at the cyclists who wear helmets AND iPods). When a driver opened a door onto my partner recently he shouted "I wouldn't have to worry if you'd been wearing a helmet" That sums it up as regards cycling in this country. In Holland, most people - cyclist, pedestrian AND motorist understand that cycling is a GOOD thing for all, and most people manage just to get on and treat each other with respect (and alertness). And of course, there seemed anecdotally to be less obese people.

So, I enjoyed Amsterdam as a city and for demonstrating to me that cycling can be a serious MAJORITY method of transport in a wealthy economy.

Oh, nice windmills too.

What about Google?

Tim commented on my post about Microsoft Live with

...but wanted to comment on your note on Google, given today's announcement of Google Base and a stock nearing $400/share. how long will it be before Google offers the same basic suite of products Microsoft offers, with more limited functionalit,y but completely integrated with your phone, email, music and videos?
i think their model will have a devastating effect on Microsoft, but will take some time. we are still at the early stages of advertising funded services and software products. i will enjoy the convergence of technology and consumer need/wants as companies like Google eat away at Microsoft's market share.

Indeed, I see Google has gone above $400 today giving it a market cap of $111 billion - still just over a 1/3 of MSFT, but astonishing nonetheless.

There have been lots of stories that it is Google that Microsoft fears most, from chair throwing by Ballmer, to lawsuits about employees being poached. And also, much of the coverage of the MS Live announcements was about it being primarily a response to Google. Clearly Bill is quite worked up about Google. Web 2.0 (whatever that actually is) and the advertising model are truly massive threats to the traditional MS business.

But, is it all going to go Google's way? I can't decide. Of course, I use Google, and it is hard to keep up with all their offerings. I saw today (Guardian) how a journalist uses GMail to actually write his stuff on the road these days rather than buying another Office license. Is this the way it can go? I personally don't like the ad model - I prefer my TV to be adless. And (as Tim well knows) I hate anyone having too much control (I'm as vehemently anti-Murdoch as I am anti-Microsoft). How long before Google gets in this position? And does it matter whether a few of us rail at it's powers? What worries me most about a Google dominance is that it not just has us by the short and curlies with a tightly integrated service (well not yet, but supposedly one day!), it actually has our DATA. With Murdoch we get HIS views rammed down our throats, but that's it. With Gates, we get his software forced on us (pretty much in business anyway), but that's it. With our data there (or perhaps more worryingly, data about us put there by someone else) the scope for abuse becomes much much bigger. What happens if the NSA/FBI/CIA has backdoors into it? There is scope here for a 1984 scenario. And there are other issues about privacy that are quite concerning.

And while I can make a choice and take my custom elsewhere with Murdoch and Gates, I can't really take my data away from Google - it's there, potentially indexed for ever. Even if I trust the Google mantra of doing no harm, I'm not sure I can trust their system not to let out this data, nor can I blindly trust that someone will not takeover Google and use it more nefariously.

So, it is for reasons such as this, I won't be putting a lot of my data on Google, though I can't necessarily stop other people putting data about me on it (a bit like Plaxo contact system which I avoid like the plague). But, my fellow citizens demonstrate I am in but a small minority with views like this and principles that I stick to (whether stupid or not). Lots of people have subscriptions to Sky and buy the Murdoch media. So, whether I do it or not, I may again just put myself in the position of denying myself something useful for a point!

But, it might only take a mistake or two in execution from Google to put this plan into jeopardy. If the trust element that Google has so strongly today is compromised, I'm not sure it can be as dominating. It can also start to lose that trust not through bad execution but through turning the screws on ads to please the never-ending financial growth projections, while slowly making the service less useful than it was.

If Google doesn't mess up, and doesn't push too hard, AND it can demonstrate to people that they SHOULD trust it, then Microsoft is stuffed. As I pointed out in the earlier article, I don't think they can maintain/transition a model of license fees, service fees, AND ad-based revenue without people just getting more and more suspicious. With Google you know where you stand - it's free and it's ads. But as MS goes through the transition, people will start to feel they're paying out multiple times for much the same thing, and will resent it. Also, I don't think they've got the innovation to WOW people. So, people will be less inclined to jump on the next MS thing.

But, I should also point out that my prediction of MS in it's last dying gasps is meant partly in jest, and that I don't expect MS to suddenly dry up and go bust. But it will become as irrelevant as, say, IBM is in setting the trends and dominating IT. Sure, it will still make money - probably from the Enterprise market which through it's conservative nature of upgrades etc will continue to stay with MS for far longer than it should. And also, MS is still a great friend of the developer community (at least for Corporate software), and this momentum will take a long time to slow down. So, as a consumer, I expect MS to lose its monopoly position anyway. Whether Google picks up the baton is partly up to its own execution and whether people in general will swallow the not-so-obvious downsides of a "free" service.

Let the Rumours Begin...

News from Portal Player - supplier of much of the brains for most iPod models.

Basically they have postponed a new offering of shares as the price is not high enough for where they believe it should be. Tantalisingly they give among the reasons for their optimism "...we expect an additional major market segment for our products to be introduced in the first quarter of 2006"

Now, I don't know who they could be talking about, but there's not many players that can fall into the category of creating an immediate and substantial market. Perhaps a large cable company in the US? Microsoft has it's hands full with the XBox and other things. Otherwise, there's only one that I can think of for which such a suggestion could not be considered outrageous.

This will mark the serious kick off for the rumour sites about MacWorld in San Francisco, January 2006, for the "just one more thing..." section.

Just to get things going, my wild guess is that this will be part of the AirportExpress2 - video version with H.264 decoding built-in.

The Service Economy Gone Mad?

Another article from the Ars Technica folk about the man who has bought a Space Station for US$100,000. Sounds like a bargain, except that this is a virtual space station. It does not, of course, physically exist. Instead, it exists only in a parallel game universe - that of Project Entropia. Apparently this universe has a current annual GNP of about $150m.

Can any economist explain to me whether this is a good thing or not? It's not manufacturing certainly, but is it as valuable as some dry cleaning or a haircut? Or is it just robbing (dumb) Peter to pay (cleverer) Paul?

Sony comes to the rescue.

Completely unintentionally of course. But the rootkit row which Sony has started is likely to go down in history as one of the biggest corporate mistakes. Whereas Sony did so much to allow the consumer rights as regards taping video programming, it's looking like their unbelievably crass actions now they're on the other side of the fence could be THE catalyst for consumers rallying against unreasonable DRM.

This article at Ars Technica is a great resource for links to the background and the growing outrage about this - there are countless others. It has exploded from individual geeky ire to major lawsuits by authorities across the globe (note - these are not class action lawsuits). It has shown Sony to be anti-consumer by targeting not pirates but normal people who indeed may not have made any copies whatsoever. It has created a backlash which will lead to a boycott of their products. And it has made the average Joe wake up to what is happening. Far more people are likely to take positive action in response to unreasonable DRM tactics. The icing on the cake (except if you're directly affected that is) is the news - also in the Ars article - that there is already a nasty trojan in circulation that takes advantage of the security hole the Sony software has opened! I particularly hope a few affected Vaio owners make their feelings known about this!

I was also pleased to note this news (again carried in numerous places) about consumer groups starting to fight for DRM interoperability. Now, I'm not necessarily a believer in these types of groups getting things done, but at least I applaud their efforts.

That this issue is becoming mainstream is good news, and not before time. In the 70's there was enough momentum from hardware companies (ie those making VCR's) to ride roughshod over the objections of content companies, and lo and behold it all worked out well for all. If we don't have such fights now for the soul of this, it's all going to end in disappointment, piracy, and fat legal fees. Microsoft doesn't seem able or willing to stand up for it. Apple is the closest to a consumer champion in fighting at least for fair DRM (if not interoperable DRM). But while it could achieve a lot with content providers when all it had was an mp3 player that worked with 2% of the world's computers, it now provokes fear. What is needed is a few providers (hopefully including Apple) to just get on with it and prove that there is a pro-consumer middle ground that is both anti-piracy and anti-old guard (oh, and PLEASE, interoperable). They may have to take a few gambles and fight a few court battles along the way, but in the end the consumer will reward their actions by buying the gadgets that will be the 21st century equivalent of the VCR.

Finally, I would also make the observation that once again Sony's left arm has done something that hurts not just itself (though strangely it may eventually be a beneficiary) but it's whole. And this time it's very visible. The name of an organisation once synonymous with enjoying entertainment anywhere has been sullied once more as a killjoy. I'd love to know what reasons people can actually give for wanting to buy a Sony MP3 player for instance. Anyone?

Loss of Creativity

I noticed the announcement of a new Creative MP3 player yesterday - the Creative Zen Sleek Photo. I like to see what the competition is doing to fight the iPod phenomenon. What struck me was how far they seem to have fallen behind the iPod. It's a 20GB player with a screen that can show photos (jpeg's only). It does have one or two extra features over the iPods in terms of FM tuner and built-in recording (though the iPod now has excellent recording features built-in if not directly usable). But the corresponding iPod now has a 30GB disk - 50% greater capacity. The Zen is 46% bigger in volume and is 16% heavier. It's screen is smaller. And, it doesn't do video. It's price is... well, the same as the 30GB iPod.

Now, I was about to blog just about this very item before I also came across this quote from chief executive Sim Wong Hoo at the recent post-result briefing. "We'd like to focus on the profitability and not market share". You can google this quote at many news sources. That was around the same time Creative announced a pretty dire set of results with the MP3 player business gouging their previously highly-profitable sound card business. And, the same time that Creative criticised Apple for locking up supplies of components (presumably at prices that Creative could not obtain). So, that accounts for why this is priced realistically rather than aggressively.

So, with Rio departed from the market, and Creative essentially in retreat, that leaves just a few big players around who have the deep pockets to make this a competitive environment. First to mind is of course, Sony. However, their deep pockets are also stretched on making the next-gen PS3 a success, which they hope to do by subsidising the players. A large company doing well financially may be able to have a few of these initiatives, but Sony is not performing, so I would doubt it could muster up another set of subsidies to make it's players more attractive. It certainly doesn't win it with features, and it certainly doesn't woo the customer with it's anti-consumer actions such as ATRAC, Sony Connect, and most recently the debacle with it's Copy Protection system on CD's that does nasty things to PC's. Perhaps Sanyo (with a range of cheap and cheerful players) or Samsung (with storage manufacturing capacity to allow it to price effectively) are the only other people who can realistically put up a fight. There is still iRiver of course, but they are facing the same issues as Creative.

The one other contender could be Microsoft. But even this company seems stretched in a number of areas (XBox, Vista, Office, Windows/Office Live, etc), and selling own-brand hardware for MP3 playing would be a tricky gamble that would risk alienating many of it's partners not just in the hardware business but also in the music sales area. They would also then be open to the one charge that Apple is vulnerable too - the complete control of a relatively closed eco-system. Microsoft may rue that it was not nimbler when the market was less mature, and had managed to get a range of decent players from it's partners and a range of music services that truly did "play for sure" while offering good value and fair DRM. Too little, and too late.

In the meantime, Apple will go from strength to strength in this area. It understands how people evaluate innovative products. It didn't tell people "heh, you need a video player" it gave people a compelling reason to try it out by offering the same as before in a smaller package with more features at the same price. Likewise with the nano - it offered essentially the same as a mini but in a MUCH smaller package that could be manhandled (scratching issues aside), so much more useful for the active market, again at the same price. The good thing for consumers is that a powerful supplier of hardware may be able to exert pressure on the already too powerful and oligopolistic content providers that in the end will break open the market. A similar thing happened with the VCR which the media companies were in the end unable to fight to the benefit of all. If the labels think there will be alternatives to Apple, then they may hold back, and spend the time bitching about 20cents per item here or there. But if they realise they'll have to play ball, then perhaps we'll get some innovation in digital content distribution and usage. At the same time, let's hope as consumers, that Apple doesn't get everything it's own way and become arrogant and unresponsive. I no longer can see Apple being brought down by competition in this market. It's reign can be ended by innovation/convergence in gadgets rendering the iPod useless (as Smartphones have done to PDA's). For reasons I've already blogged here, I'm not sure that will happen too soon. It's reign could be ended by it's own mistakes (e.g. arrogance, failure to integrate into the home environment). But in the end, I wonder if it will be the competition authorities that will have to intervene in a few years time to free the consumer from a system of content distribution in which one company sets the rules, sets the pricing, while selling the hardware, the software, AND the content too.

I'm not saying this is imminent or even the likely outcome - far from it. But it has become a realistic scenario for sometime around the turn of this decade.

Microsoft Lives (or Dies)

My favourite monopoly announced two new services this week - Windows Live and Office Live. Depending upon your point of view, these are either re-hashed initiatives that will also fail, or a serious attempt to redefine the company and fight the challenges it is now facing from the likes of Google.

Apart from whether Microsoft can pull it off functionally, more in a minute, my basic question is whether users will ultimately be willing to become even more tightly dependent upon one behemoth that has in general treated them shabbily when it comes to security, and extracting money. More worryingly for them is that while a move to services - some of which may be free by being ad-supported - may indeed be THE way forward, there is going to be a LONG transition whereby customers are going to be paying for licenses, paying for services AND getting ads bombarded to them. Whether MS intends that or not, that will be the reality. And my gut feeling is that people will not like that. Whether you like Google or not (I generally do, though I'm becoming wary of an all-dominating Google), you know where you are with them. You can make your choices about whether you use their service(s) and how much you use it by whether it gives you benefits for the trade-offs in what they do with the information about you they pick up along the way. Because all the services (today) are free, it's a pretty easy decision. You also accept that Google has to make its money from somewhere, so as long as it's free to me, then I'll accept those trade-offs (until for me the service gets degraded by Google having to meet too strong demands from the advertisers)

But with Microsoft, it's not the same. Many people already resent them for making so much money on the back of very average, hard to use, insecure software. Everyone of us - even most Mac users - pay the MS tax every year for some part of our computing experience (well, ok, there are some Linux people and a few Mac users who manage to avoid it). Now, just how many of these people are going to welcome giving MS another revenue stream in services AND having ads thrown at us left, right and centre. It's a much harder decision to make. And, given that MS cannot really lock this stuff in without setting off down the road to the courthouse, people WILL have a choice this time around (or am I being too optimistic?).

And then there are the internal issues. The company cannot walk away from software licenses - indeed it needs them massively. Most of its employees are involved in that side of the business. There are therefore too many powerful internal forces at work to ensure that this is anything other than a permanent catching up exercise. By its very nature, it cannot do a "paradigm shift" even if its customers bought into its strategy.

There are other worrying signs too (for MS). The presentation was truly awful. Thanks to a few pointers from my usual sources for the link to this critique of the Powerpoint presentation used. These are basic mistakes. And, as usual, I hear the demo failed half way through when the wireless network went down. Plus ça change.

It was also the first time I'd got to see a photo of the XBox. It is ghastly - a typical "box" with no reason for it's shape and from what I could see of the colour, not something that you'd be wanting to put next to your new flat screen tv, even if the kids are happy with it in the bedroom. Now, I am not a gaming expert - indeed I am at the luddite end of the spectrum in this area. But I had briefly held the view this week (after reading this Ars Technica piece that out of the 3 protagonists (MS, Sony, Nintendo) MS would take the crown, with Nintendo taking the second place through pure gaming focus and price. Given the mistakes Sony seems to be making on everything it comes out with, maybe that's still the view, but I do think MS could have come up with something a bit better looking that people would be proud to use as a MCE (Media Center Extender) and make it the trojan horse into the living room.

What all these failings point to is that MS does not take DESIGN seriously. It does not design it's slides to communicate; it does not design it's products to be intuitive, and does not design it's boxes to be "must-have" gadgets.

Until it takes design more seriously (find and empower the next Jonathan Ive?), it will fail to wow people. If it can't wow people, then the resentment of paying license fees AND service fees AND being pestered with ads will surely drive an inexorable decline for the company. We had the years of conglomerates in business and they've pretty much been consigned to the graveyard of business theory. A conglomerate in software and services, even starting from a monopoly position, is just as doomed.

Microsoft's Lives are in fact its dying gasps.
(edit corrected spelling mistake!)

What's a record company?

An excellent article in the Sunday Observer Business Section from John Naughton about the failure of the record company's to embrace technology to the advantage of all.

It's the first time I've come across the specific breakdown of how revenue is shared from traditional CD sales (not sure how accurate and whether that is the same whether Amazon or via an HMV store). You don't really have to do the maths to see how compelling the arguments should be for doing the right thing.

My only quibble is "In the end, of course, rationality will prevail..". Well, it's not a quibble it's more a question of when we can expect the "end" to come? Somehow I'm beginning to think it may be a long while.

And then, that's just the music business. What about the video side of things (movies, tv)? Why do these businesses deserve protection from disruptive change when no other industries have had such protection? If it was about protecting the copyright holders, I could perhaps understand it. But in fact, they are perhaps the biggest losers of all (incidentally, I believe that copyright holders actually get LESS of a cut from online sales - a point John doesn't make. Can anyone confirm or correct this?).

When the industry consolidated to 4 big players, it was clear this sort of thing would happen. This is a clear case of a cartel/oligopoly. It will be revisited in countless business case studies in the future. Governments need to intervene to free this market URGENTLY and should be reversing legislation that counters fair use and fair distribution. They could start by freeing the copyright holders from exclusive contracts and ensuring that different channels of distribution (eg CD, Online) are via separate companies.

I'm getting quite pessimistic on this subject and think we'll still be debating this in 5 or more years. Each time we watch/listen to something, we'll be forced to watch/listen to a lecture on pirating (those FACT ads at the start of most DVD's are really starting to grate - it's like seeing those Bacardi ads in the cinema over and over again, only worse).

What is perhaps needed is a revolution. Someone somewhere defines an agreement (eg Creative Commons or GPL-style - but for the consumer - let's call it a Digital Rights Agreement - DRA) that we can sign up to about fair use and non-piracy. An agreement that protects the copyright holder, but one that allows a consumer to use the material they have purchased in a reasonable way. If you sign up to DRA (once, not everytime you buy), you get indemnified against action from the labels unless you have violated the agreement. The labels couldn't afford the lawsuits. And, they would lose because the agreements would be seen as fair. But this means people agreeing to SOME form of a DRM (either active or passive) that allowed the DRA to be adhered to. I don't really have a problem with this, but for some any DRM seems to be a no-no. Would enough people sign up to something like this? Could an agreement cover all the ways in which people could (mis)use the rights? And could it adequately take into account changes in the future which might render the agreement useless? I'm going to give a bit of thought to the rights I think would be reasonable, and revisit this in another post. Open Source changed computing for the better. We need something similar NOW.

Mobile Music

Great article over at Wired magazine by Frank Rose on the Battle for the Soul of the MP3 Phone (not just about the ROKR failure but that explains a lot as well)

One piece of information I learned that explains a lot is that the record companies are demanding a consistent percentage of the revenues from downloaded songs. Today that figure is around 70% of the revenue. Fair enough you might say. But then the cost of distribution comes in. Frank quotes a figure of between 15 and 50cents just for the bandwidth cost of downloading a track. So, the record companies want the same share again, which means the distributor must add between 45cents to as much as $1.50 to the price of the track just to keep the labels happy! Now, I would imagine SOME people might pay a premium to have SOME tracks downloaded instantaneously. But if that premium is essentially 2 or even 3 times the price from a normal online store, they just ain't going to do it that much. And remember, most people getting it to a mobile will also want to have a track downloaded to their computer for back-up purposes at the least. That also costs money.

The labels want more (more than they get from Apple, and even more from the telcos). The telcos need/want a premium price but would of course rather share less. And the phone manufacturers would want something for making a decent phone that does it all. The labels maintain people are willing to pay more than 99cents a track. And indeed they probably are for SOME material. There are certain bands I like that I would pay more for their music. But then there are others I wouldn't try if they cost more than I pay today. And indeed, there are some I just don't try today because it's not worth the experiment. The labels trot out Robbie Williams or a few other examples, but really, there's no point in using 0.1% of your artist roster to justify a point. Jupiter Research have consistently maintained the sweetspot is around 99cents per track. That is what will generate the biggest volume. And that in the end is what is best for the industry. $3 tracks are not going to fly - at least in volume terms.

So, the telcos are pretty stuffed as far as music goes. Until they can agree a reasonable deal with a greedy cartel of labels, they can't really do much to get into the volume market. Is there any sign of that happening? I don't think so. Even then I think there is a fundamental flaw in the telcos thinking they are going to have a real business selling downloads.

Take the UK. There are 5 mobile telcos not including the virtual operators (eg Virgin). People are not super-loyal for the most part towards any one brand. Even if they are, why on earth would they choose to buy music from the Orange music store for example? This would tie them in much much more than they would want. The phone co's think they'll go for this but they won't. So, surely using WMA and MS DRM would make this less painful? Perhaps, but so far that's unproven. Who in their right mind wants to pick up a collection of online music from multiple stores? Do they really expect it to keep on working for a long long time on whatever gadgets they own and whatever networks they are on? And from what I've seen, different stores offer different DRM's. That's a recipe for customer confusion.

Even then, let's assume the telcos strike a good deal with the labels and can offer a competitive download service. Assuming the market is split 20% each in the UK to the 5 operators and ignoring the virtual operators, that means the very best any operator can do is to corner 20% of the market (after all, an Orange customer is not going to be downloading their material from a Vodaphone music store). To get 20% of the market, you'll need to do so well that ALL your customer base uses your service in preference to any other music service (Apple, Napster, Real, Yahoo....) To limit yourself to your own customer base is not the way to make this successful. So, all the companies are destined to have a niche business which in the end cannot be sustainable.

Why, oh why, don't they realise this? They could do a deal with a major company (such as Apple, or maybe Real or Napster if Apple's too greedy) and offer a compelling service. Don't try and brand it OrangeMusic for goodness sake. You didn't brand it OrangeText did you? It was called SMS and it worked, whatever the network. Your customers think you know NOTHING about music, so don't try and pretend you do. Make sure people get a good price for all their music but pay a premium for having it NOW; Offer value-added services which can utilise the value of the network; understand people want the music on their phone, on their mp3 player and in their home; and they want it securely and with reasonable DRM; and they want a decent phone to play it on - one that has real benefits from being a converged device, not a compromise.

The longer they take in getting this message (and hampered by the greed of the labels) is manna to Apple to make the iTMS/iTunes/iPod so completely ubiquitous that the only deal they'll be able to do is with Apple on it's own terms. Music would have been a great way for phone companies to get a lot of their customers using data services. Once you've used your first data service, it's easier to do others. They are missing (and perhaps have completely missed?) a compelling opportunity to get their customers using the networks they've paid so much to license and create.

No wonder Apple is quietly (ha!) going about adding more and more features in smaller and smaller packages at price points the whole market can take in. The only other competition as Apple has rightly said time and time again is from the pirates. And that's what will happen with mobile music too. I suspect a lot of people in the business know all this (as the Wired article suggests), but that Corporate greed fanned by stupid lawyers "protecting" their clients' interests are what will prevent the right business model emerging and everyone missing out.

Disagree? Why not sign up and post a comment?

This was fun...

This was fun...
Originally uploaded by Hobflickr.

Had to share this with you.
It's a Formula Ford car. I was braking from close to 100mph at this point failing to get it into 2nd gear for a chicane.
First time in anything remotely like this.
I'm sure you're not interested in my racing exploits (unless there was blood and gore which this time thankfully there was not). But, from a geeks perspective, I was fascinated to see how much the internet has changed so many hobbies in ways in which you wouldn't imagine.
The track was booked via bookatrack.com for instance. Such a service almost certainly boosts attendance at these tracks and allows even the small ones to eke out a living. In browsing around, I was also amazed how many different enthusiast sites there were for this type of racing.
And on another geeky note, if you look carefully above/behind the driver's head is a lens attached to a video camcorder which gave great footage as I traversed the track - something I'd assumed only F1 could do. An early candidate for something to go on the iPod video I'm considering?!)
I'd like to thank my friends Iain & Julie for indulging me.

Why Firewire will never make it

For those of us wondering why the excellent Firewire standard has not become more mainstream, and why Apple increasingly seems to be distancing itself from the standard it did so much (but not enough) to promote, I refer you to this white paper by James Wiebe, Founder of Wiebe Tech - a maker of storage solutions.

It is a disappointing story of technical issues (though none insurmountable), failure to deal with said problems quickly, greed from various vendors involved, closed-mindedness, poor marketing, etc... While Firewire 800 promised so much - fixing many of the issues of Firewire 400, and having a significant lead over USB2 in so many ways, it's failure to be promoted as a mainstream consumer technology condemns the whole standard to be an also-ran - limited to the niche professional market for limited uses.

This does not reflect well on Apple. It is another indication that it falls down when it comes to the right time and methods to open up it's technologies

Fortunately for those of us worried that we'd be left with USB2, the article suggests that while this will be in common use for many devices, we will fortunately have another standard in the form of SATA II for higher speed requirements (such as storage).

James invites comments (though doesn't promise to answer them). I love this aspect of the blogosphere - we can get to understand topics in far more detail than we would otherwise have done. Do read the article if you're interested in this topic either technically or for a business studies analysis of what went wrong! Thanks James

Sony PSP vs iPod

I have already seen some comments trashing the new iPod in numerous ways and suggesting it should have inherited many of the (video) features of the Sony PlayStation Portable (PSP). Now most of these comments are coming from people who probably haven't actually used the new iPod, but looked at the specs. And I suspect some haven't used the PSP either.

I came across this article from an online magazine specialising in the PSP, comparing the two. The author HAS experience of both and makes some excellent points. While suggesting that it might be unfair as the PSP is a gaming machine (but then isn't the iPod a music player, first?), it's a pretty damning article about the PSP (for non-gaming features) and Sony's approach to video overall. The author doesn't even award points to the iPod for it's portability (it's significantly smaller than the PSP of course) - he/she concentrates purely on features, costs, and the overall quality of the experience. The final sentence sums it up:

"...if Sony doesn’t pull together and start taking advantage of the PSP’s multimedia capabilities, they are going to lose sales of PSPs to the video iPod. It’s just that simple."

After the curtains closed

(in relation to Apple's announcement on 12th Oct)

Well, I'm feeling quite good about my predictions this time. I've usually got many things way wrong, but this time I think my predictions were pretty accurate.

Let's deal with what I didn't get right.
1. I didn't forecast the iMac changes. But I understand why they chose this machine rather than release the pro-machines at such an event. This event had the eyes and ears of the world (and therefore switchers). The machine Apple would like people to switch to is the iMac. The faithful may be more interested in Powerbooks and Powermacs, but many of them aren't interested in iPods. For them (me too), I still think there'll be new Powerbooks in the next 2 weeks - and maybe Powermacs too. So, the iMac announcement was a pleasant surprise. Nothing earth-shattering but it gets some extra features all at the same price with a slightly smaller enclosure. I'm not sure about built-in iSight - I occasionally move mine around to give people other views of where I am - can't do that very easily with a fixed one. But then, heh, it's free!

2. My "finale" suggestion - rather tongue-in-cheek - of Madonna on stage with a pink iPod was also not correct. But I did note that Madonna's entire(?) video collection is on the store, and publicised heavily. I wouldn't discount a Special Edition version of the iPod either before Christmas to coincide with the release of her next album. Also note the gap now the U2 iPod is discontinued. Anyhow, a pink Madonna iPod is not for me!

On the iPod front, I'm pretty pleased with what I predicted. I had perhaps expected 80GB version for the top end. But then, the reduced size of the 60GB version more than makes up for that (I'm sure an 80GB isn't far away). I think it's great what they've crammed in. It's also very conservative really - as predicted. This is, first of all, the next generation music iPod - bigger screen and a few other features (30GB at lower end) that just happens to do video too, and at the same price as the old models AND in a smaller package. Can't argue too much with that. I predicted Steve would not trumpet them as full blown iPod videos - it's just an extra feature they've added - much like the first mobiles that had a digital camera. Having just bought a nano (though offered that to my better half), I now have more incentive to consider a new top end iPod rather than a second nano. If I'm typical (and I'm not) then that would indicate they've done enough to re-invigorate the top end models.

I'm also pleased with predictions of the content - the music videos and TV programmes in particular. I never thought there would be full blown movies - I don't think we're ready for that in all sorts of ways. I did perhaps think there might be special video podcasts - eg news, weather, available free. But maybe they'll come along (I think there's room for them in the current menu structure). I'm also pleased with the price point with one big exception I'll come back to. I felt £1.50-£2 would be doable. In the US, at $1.99, I think that's excellent though again with the same caveat I'm about to come to.

Clearly, they've focused on getting some content out there, and also providing it in a way that can be used FIRST in the home, and second on the go. The content isn't just for the iPod, but the iPod gives you the flexibility to view that content on the go. I also understand (but haven't tried it) that it should be possible to move recordings from, say, EyeTV to the iPod. So that's good too.

I had also predicted (though this was at the higher end of my prediction) the Airport Express 2 device. In fact we didn't get this, but we did get a Universal Dock with remote control. In essence this does much of what I had said, but is tethered to the computer OR to the TV/HiFi and requires physical connection to a source (eg the iPod). I think something that allowed the computer to play the video THROUGH the TV remotely would have been really cool. Maybe we didn't get that today because it's too much to take in? Or perhaps they needed something big for MacWorld in January? Or perhaps they really need 802.11n to settle to make it a workable solution? But really this device is just a Universal Dock with an Airport Express component. It shouldn't be too hard, and it shouldn't be too far away.

I'm not sure where they're going is EXACTLY where I personally would like them to go. I still don't see a family or a couple sitting in front of an iMac for couch-potato like (in)activity. And in my case I still prefer something more like the mini as the answer for my needs. But then in all reality I'm still on the bleeding edge of this use.

So after all this, what is there NOT to like?

Well, actually quite a few things. Mostly (hopefully?) fixable.

The biggest disappointment for me is the resolution of the video. I would snap up a lot of the music videos IF they were of DVD-quality (I don't need HD for these, yet). And ideally, I'd liked to have had them with 5.1 sound as on the DVD itself. I haven't tried them yet (I had problems using the store right after the announcement), so maybe they'll look better on my plasma than I expect. But I would have liked the option of having a higher resolution version for home use, and either conversion or a low-res stereo version for mobile use. I know there are issues with bandwidth here. But, I'm not going to buy these things even at the attractive US price point of $1.99 when I can get much better with a DVD off Amazon. I'll limit my use (if at all) to one-offs much like I buy the odd single off iTMS.

The next disappointment relates to the UK market. The videos here are £1.89 - admittedly within my initial price point. But then I had expected them to be full SD or ED resolution. I'm particularly disappointed that the price gap between singles and videos on UK iTMS is £1.10, when it's $1.00 in the US. Take the VAT off, and do some exchange rate calcs, and this difference is very substantial. I expect we're seeing the hands of the greedy labels again (what a pity as they usually get nothing from music videos - just publicity. At that price and quality they'll continue to get nothing!).

Also for the UK market there are no TV programmes available. Given the location of the UK announcement (BBC headquarters) I'd thought this was the obvious outcome. I suspect it will come, but I'd hoped for something (or a mention). Given the BBC doesn't do adverts and has already got a license fee from us, I might also hope that either they will cost a lot less here (for a low res version) or even be free to UK iTMS users. I'm sure US users would be happy to pay $1.99 for their BBC Office episodes.

Another gripe with the announcement is that they've just provided the FrontRow application on new iMacs as best I can see. Why can't I get this for my mini? Why couldn't I run this on another Mac? I could use my Bluetooth remote control for this on any Mac. I suspect this is designed as a way to incentivise people to buy iLife06 when it comes out next year.

I'm also slightly disappointed with the complete omission of Firewire. But I guess this was inevitable. Most users do not value this, so making it a part of the device would just reduce margins for apple, and even perhaps make it bigger. Unlike others though I'm not disappointed with the video DRM. I understand why burning a DVD would be an issue. I don't think I need this, though I would need backup capability (which I think can be done).

Some might say the iPod video should have been even more adventurous? Wide screen aspect ratio and a bigger screen for instance? But to do much of this would have changed the iPod significantly and presented the challenge of how to have a scrollwheel on a horizontal device (or a device that allowed rotation). Given 10% left handers, I think a right-sided scrollwheel would have got a few complaints too. And of course an appropriate battery would have made the device much bigger. But I think time will solve these. If the demand is there, Apple will jump in with something more serious. But for now, you've got a MUCH better top end music iPod in a smaller package at the same price that happens to do video. There'll be more things that come along that make use of that bigger screen and/or video capability.

So, I think overall it was a very positive announcement - worthy of the hype. The iPod range has gone from looking a bit stale to being very exciting and at the forefront again in just 6 weeks. The content deals are interesting and hopefully just the start. The simplicity of the whole will again be compelling - especially to the real public rather than the geeks. But I think there'll be a lot of people who were happy to buy compressed music but that will not buy video in such a degraded form. For Steve's next trick(s) I'd like to see that weakness addressed, I'd like a lot more content deals - esp. internationally, and I'd like to have the content moved wirelessly around from computer to TV for those times when you do just want to slouch on the sofa.

Anyone want to offer their thoughts, or are you all fed up with it by now!

Real Networks and Microsoft - Winners and Losers

Yesterday we learned that Microsoft and Real Networks have buried their differences and joined forces (perhaps to take on Apple in the music area). Cost to Microsoft, approximately $460m with other soft dollar considerations taking the figure up to $761m. According to my calculations, Microsoft has now agreed to pay approximately $5.5bn to 8 companies (Sun, AOL, IBM, Novell, Real Networks, Intertrust, Gateway, Be) over the last few years in settling anti-competitive lawsuits. Many of the other cases have also been settled not just with money but with new alliances, most notably in the resolution with previous arch-enemy Sun Microsystems.

Now just think about that figure for a minute. $5.5bn is a truly huge amount of money. Assuming 1bn computers out there, it is $5.50 for every single computer user. That Microsoft has accepted to pay this figure is indicative that their profits from such anti-competitive behaviour have in fact been considerably more than this figure (I have read of detailed studies indicating the actual cost of the MS virtual monopoly to be in the region of $10bn EVERY YEAR).

Now anti-competitive behaviour is very bad for the firms competing against Microsoft. It is bad for their employees and it is bad for their shareholders. They should indeed be compensated. Financial compensation of this magnitude is perhaps reasonable given the opportunity that has been lost by those companies. But is it? Not if it takes years and years to happen. The shareholders affected by such behaviour have probably long since departed. They will never get to see any of this compensation, though it was they who took the risks at that time. No doubt long-term employees may feel the wait has been worth it perhaps with more security in their jobs or a one-off bonus to make up for those lean years. But what about the employees around when this all took place? I'm not talking about just their missed compensation. But their career prospects - delayed or even destroyed by this behaviour. They will never get this back.

Then let's look at the real losers of all this - the users - whether consumers, small, medium or large businesses. They were denied a choice when they should have had one. They were forced to endure a worse solution than they could have had.
And, they were forced to pay more than they should have. In fact, this very compensation has come from THEIR pockets after all.

And there is the rub. Not only have they paid dearly for the anticompetitive behaviour of MS, they will not see any benefit from the resolution, and indeed, such resolutions have more often than not led to even less choice, less competition and further barriers to new entrants trying to provide consumer value in innovative ways.

It has been said that this deal will not affect the EU stance against MS (which has cost them another $500m or so of course in fines). But of course it will. It already has. Evidence may have been collected and documented but the unwillingness of previous complainants to pursue their cause can only lead to a reduction in overall noise levels. Solutions proposed are usually too little too late to affect that market, which has moved on. The next set of battles are already being fought (somewhat one-sidedly), but what should have been permanent, effective and general remedies have become specific, lottery-style payments, akin to paying off witnesses in a criminal case. And no more honourable.

Was it coincidence that the announcement was timed for the day of Apple's FY financials which continue to show dominance in the music area, and the day prior to Apple announcing another (possible) leap forward in it's offerings? Maybe it was, but I can't help feeling the headlines have been a lot more sympathetic to this resolution, than if Apple wasn't in the news reminding everyone that it is on the road to becoming the Microsoft of personal music players.

I think Apple is possibly a big loser in this announcement (strange that the share price didn't immediately react to that news, but then did react significantly when they didn't quite overhit the higher targets predicted by analysts?). But then Apple may need some competition if it is not to get too complacent and too greedy (eg reports this week of levying a 10% "tax" on 3rd parties). But I don't think competition between 2 organisations, one of which is Microsoft is what I want to see on the world stage. And that is perhaps what this may come down to.

And that leads me to who I think are also losers in this. It's the companies that have tried to compete with Apple by adopting Microsoft's "more open" WMA technology. Plays-for-sure may be the term used, but I think now the consumer may perceive "plays-slightly-more-sure" for the Real solution. Napster, Yahoo, HMV and others are the biggest corporate losers in this. But then perhaps they'll be the ones winning big lottery payouts in a few years. And then once again, we'll look round and we'll see that the true losers, time and again are the end users. After all these shenanigans, you still have just one music player on your computer out of the box (windows users that is), and you have even less choice about alternatives, about where you can get the content and will be forced to accept the restrictions imposed on that content.

FInally, in wrapping up, I'd like to congratulate the only other winners I can see in this. Microsoft's and Real Network's lawyers/law firms must be very pleased to have come up with such a settlement and with their respective cuts of it. I'm sure they can look back with pride on their work and how they have once again served the public with a resolution that serves to make a mockery of the laws that were used to bring about the dispute.