30 January 2007

Praise for British Journalism

I've been quick to post about poor British journalism, especially when concerned with things of an Apple nature (but certainly not exclusively). It is therefore pleasing when I can link to articles that show a good comprehension of the issues involved with excellent succinct writing.

The FT is the one example of British journalism that invariably never fails. It's understanding of the issues around Norway's (and Europe's) seeming dislike of iTunes is absolutely spot on. Unfortunately this editorial piece requires a paid subscription, but here's some excerpts:

In Norway a total monopoly on selling alcohol is legal but now Apple’s 70 per cent market share in downloaded music – which is probably only temporary – is not. Norway’s consumer ombudsman and its counterparts in Sweden, Finland, France and Germany have really not got this monopoly malarkey quite worked out.

Apple’s success in digital music is due to design, innovation and a good business model: qualities to encourage, rather than punish via questionable competition rules. Perhaps Norway needs to sort out the alcohol before worrying about the rock ’n’ roll.

In case you think the FT is too kind on Apple this paragraph also shows a keen sense of some of the issues and possible outcomes:

This does not mean that Apple is right to maintain a proprietary model: there is ample evidence that consumers benefit from open, universal standards. If there is no further innovation, and iPod remains the state of the art for years to come, then Apple might maintain an unhealthy market dominance.

But technology moves quickly in electronics. Competitors like Sony Ericsson have not yet made much of a dent in Apple’s market share, but the trend for integrating music players with mobile phones will threaten the iPod’s dominance over the next few years.

Most commentators on this issue seem to think Apple needs to make concessions. But at this time, it should make none. Concessions will not benefit the consumer, but will benefit the unreformed labels, and most importantly will play into the hands of Microsoft. Without Apple, we would now have a complete dominance of Windows Media Player - and probably back several versions too. We would have a DRM that was forced on us by Microsoft and its cozy collusion with the entertainment industry. We would have dull, clunky WMA players, with poor synchronisation and seriously restrictive DRM. This was first and foremost a war about Apple's and Microsoft's vision of digital delivery. We are just part way into that war in which Apple has scored some important victories over the massive and resource-rich Microsoft. Ultimately, a long and hard war will be to the great benefit of the consumers (and hopefully lead to a permanent business model change in the music industry). Healthy competition can benefit the consumer far more than government action (witness EU action against Microsoft which was far too late, and failed to provide any benefit to the consumer). Action unilaterally at this time against Apple is actually anti-consumer, and plays into the hands of those with most to lose.

Good work FT!

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17 January 2007

Lies, Damned Lies, and Statistics

I know I shouldn't help give eyeballs to Paul Thurrott's musings, but I can't help refuting this one:

While Apple's yearly revenues for Macintosh computers have barely edged up in over five years, the company's revenues of iPods and related products and services have skyrocketed

Yearly revenues for Macs have barely edged up in over five years? Really.

Well, I knew this not to be true, as I track these numbers regularly. I took Apple quarterly reports back to the final quarter of 2000 (the start of the 01 fiscal year), which allowed me to compare a full five years.

Revenue growth over the 5 years in each of the last quarters was 122%, 31%, 52%, and 84% respectively. Unit growth was 90%, 48%, 60% and 89% respectively. For the full year, revenue growth was 68% and unit growth 72% over the 5-year-ago period (a more reliable figure). This is not just a recent year phenomenon either (although the first 3 years were relatively flat).

I pointed this out to Paul in a provocative email and received a polite-ish response - obviously from someone who receives countless emails from the Mac fanbois, claiming that he got his statistics from the New York Times. He promised to investigate, but don't expect a retraction, folks.

But Paul's use of "facts" is pretty typical in this day and age - deliberate or not. It is not always easy to find the facts (though this one is not too hard). It also seems beyond many people to analyse them properly. When combined with the recursiveness of the blogosphere (and it's frequent lack of attribution to source), it is easy to see how even accurate reports from some time previously get regurgitated indefinitely to prove a point. I wonder for instance how many reporters and bloggers will (mis)use the discredited Forrester report on iTunes sales last year (or, the even worse interpretations of that report) whenever they want to take a swipe on Apple in the coming year?

Anyhow, back to the facts. I think today's financials will once again show the Mac is back on track, growing towards a marketshare that at least makes it a contender again - and especially so in the consumer market of the developed world where it is most important (for Apple) to be. Now, Paul, go and update your facts!

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MacWorld Prediction Recap!

Well, at a stretch, I claim 4 out of 10 predictions right! This is probably a lot better than most commentators since most expected a slew of Mac hardware and software announcements.

However, before I get carried away with my foresightfulness, I should point out that I only get 4 out of 10 by counting my prediction of a widescreen video iPod (which is also the iPhone and which therefore accounts for 2 out of 10!). Other than that I predicted the AppleTV would be announced in more detail, and that there would be more movie studios on board (Paramount).

Another reason my stats look better is that I didn't count iLife07 and iWork07 in the 10 predictions taking these to be a given! So, really, it's 4 out of 12. Not so good!

Anyhow, it was a wildly different Macworld, and one to remember. Sure, Steve disappointed the Mac faithful with the paucity of Mac announcements, but he took the unprecedented opportunity offered by a coinciding CES, the iPhone, AND Apple's 30th birthday to steal the headlines around the world. My guess is that Apple garnered more column inches and certainly more eyeballs than the whole of CES put together, and almost all of it favourable. In the end, that's good for the Mac, and good for the Mac faithful.

I'll be visiting both AppleTV and iPhone over the next few days to see how groundbreaking these products are, looking back at what my predictions for each (and what I got wrong), and, shock, horror, why I won't be buying an AppleTV yet. We'll also be taking a look at the financials to be announced later on today and what that means to Mac users. Stay tuned....

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07 January 2007

French Follies

I wrote back in April 2006 about the foolishness of Chirac trying to take on Google with a French (and German) competitor funded by the state, known as Quaero.

I read in a recent Ars Technica post that this project has already run into severe difficulties and that France and Germany have gone their separate ways on it.

I'd hardly take credit for an insightful post as I'm not sure any reasonable business person thought any differently than me. But, really, what was he thinking and why do the French let him get away with this?

(As an aside, my partner points out that in her subject area the whole world uses the term "DNA", except that is, the French, to whom it is "ADN". Can anyone tell me how such practices really help defend the French culture, increase it's influence abroad, and enhance it's competitiveness in the global economy?)

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06 January 2007

Philosophy, Religion and a Joke...

I noted in an earlier post about the 100 Greatest Jokes site.

I had also been meaning to write something deeply philosophical here bringing together the themes of "More British people think religion does more harm than good" (from the Guardian front page before Christmas), the Pope's Christmas message about the world needing a saviour (heh, lets be delusional shall we - someone else can fix this mess we're all creating), the finality of death to an atheist (my partner's father passing away). But then, you don't visit here for that sort of stuff do you?

Anyway, instead I'll keep it to one philosophical point and juxtapose a joke from the 100 best!

Philosophical point: To the world's religious leaders (including the preachy Archbishop of Canterbury), instead of blaming the politicians for the religious problems, why not all of you set a bleeding example. Get together and show why religion is relevant and truly has a moral and relevant purpose!

And, joke number 53 from Emo Philips had me laughing and sums up the problems faced by the religious leaders in my suggestion above:

I was walking across a bridge one day, and I saw a man standing on the edge, about to jump off. So I ran over and said "Stop! Don't do it!"
"Why shouldn't I?" he said.
"Well, there's so much to live for!"
"Like what?"
"Well... are you religious?"
He said yes. I said, "Me too! Are you Christian or Buddhist?"
"Me too! Are you Catholic or Protestant ?
"Me too! Are you Episcopalian or Baptist?"
"Wow! Me too! Are you Baptist Church of God or Baptist Church of the Lord?"
"Baptist Church of God!"
"Me too! Are you original Baptist Church of God, or are you reformed Baptist Church of God?"
"Reformed Baptist Church of God!"
"Me too! Are you Reformed Baptist Church of God, reformation of 1879, or Reformed Baptist Church of God, reformation of 1915?"
He said, "Reformed Baptist Church of God, reformation of 1915!"
I said, "Die, heretic scum", and pushed him off.

Outlandish Hobsblog MacWorld Predictions!

In the name of fun, I will postulate my top 10 interesting MacWorld announcements in order of their likelihood. Note, I am not saying they will all come to pass - indeed most will not as there isn't enough time for more than a few.

I'm not going to take the easy route of having a few slam-dunks either. We all know iLife07 will be out, and iWork07 too. And we all know Steve will talk about 10.5 a great deal. But 10.5 was never predicted by Apple to be ready by now, and I don't think they'll surprise people with it (and if they do, don't buy it, because it will not be ready for prime time).

So, here goes:

1. 8 core Mac Pros. This is a certainty within the next 2 months, if not at MacWorld. The Intel chips are ready, announced and should just plug in existing machines. Testing of such chips shows a 40% plus improvement over the existing four core versions on a price basis (the 4 core chips have lower clockspeeds at the same price point). Maybe not for all Mac Pro users, but those with lots of video processing and other tasks which thrive on multiple cores should be happy.

2. New displays with built-in iSight. This just makes sense given lack of iSight for sale and approach with all other Macs.

3. iTV. Steve will definitely say more on iTV - perhaps give us its final name? It may or may not be ready yet (I think it will use 802.11n and Apple will choose timing carefully when the near-standard is close enough to not cause them a bunch of lawsuits down the line).

4. iPod Phone. I'm still not sure this will be announced. See my previous posting for my views on this if and when it is announced. There have been some really well-written articles on this recently such as Steven Frank's thoughts and Aaron Adams' case for a VoIP phone rather than cell. (I think he's got a point, but I still think such a device would allow for mobile usage too). There's a good chance Steve will leave this topic until a later date as it's such a big announcement and complex that it may require an event of its own (and, remember, this is MACWorld)

5. Larger MacBook (a definite hole in the Apple product line up - a consumer laptop with a decent 15" screen)

6. Smaller MacBook Pro (also a hole in the lineup though not as severe as the MacBook)

7. True video iPod - ie a full widescreen model perhaps with 640x480 resolution.

8. iTunes 8. I'm basing this idea as much on the need to support the iPod Phone as anything else. iTunes 7 was quite recent and had many changes.

9. more movie studios on board; more iTS content.

10. International tv programming or perhaps first international movie availability with Disney.

One real longshot is the fabled xMac or grown-up Mac Mini (3.5" disk, higher end graphics, RAM, etc). However, there will not be a MacTablet for reasons that plenty of people have written about.

It should be great fun - and Apple is certainly stoking up the fires on this. But I wonder if the expectations are just too far ahead of what is really achievable right now, and that it'll be followed by a share price deflation and mediocre reviews. Remember it's the start of 2007 - there's still a lot more to come after this announcement.

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04 January 2007


The astute among you may be wondering about the lack of Apple postings here lately. After all, Apple is usually involved in up to half of the posts!

First up, I've been biding my time a bit. The last major post I did on Apple was an outright criticism of many of the articles written in the Guardian around the time of the last iPod release and iTV announcement. While I did draft a riposte to comments left here by some of the Guardian writers, it was frankly becoming even more complicated. So, I decided to let actions speak louder than words. We'll revisit the Guardian's criticisms when the next financials are out, and the product strategy is a bit clearer.

However, today we're going to have a bit of fun looking into the Apple Phone, iPod Phone, or whatever it will be called (but definitely not iPhone which it has been clear for many many months it was not going to be called).

We've had some incredible postings about why the Apple Phone will fail before its been announced, let alone released. I was pleased to nominate Michael Kanellos of CNet to DaringFireball for a Jackass of the week award which he duly won for his prepostorous predictions. We've had articles at other sites such as the Register about the certainty of it's failure. The Register article was at least generally coherent about the challenges facing Apple entering into a mature industry which is massively distorted via handset subsidies from service providers to consumers and how the relationship between handset maker and service provider works (badly actually for BOTH of them). But it failed to think differently. Apple does not intend to become the number one, two or three handset maker tomorrow. Its target market is first of all restricted to the richer countries - to some extent as the Mac and the iPod are. You won't be seeing too many Apple phones in China or India which today account for a high percentage of the handset market. Apple will want to achieve strong reviews and good sales in the markets it considers it is already strong in.

But how can Apple make the iPod Phone a strong proposition that people will want to buy - even if the subsidies aren't there? Well, how about studying past form with the iPod itself? Too few commentators seem to have done this. My first prediction for the iPod Phone is that it will be small. Not unusably small, but it will compare well even with some of the slimmest, sexiest phones today. Many manufacturers have lost sight of this (Nokia - where is the successor to the cute 6100?). The problem with many of these good-looking phones today is that the UI sucks, and indeed Motorola have never figured this out, and even Nokia seem to have taken steps backward in this area. To send a text message with my Nokia "smartphone" now takes me up to 15 presses just to enter text mode and select the recipient's mobile number. I used to be able to resend the same message easily. That option does not exist now (at least not obviously). In fact my Smartphone is hobbled by a combination of service provider and manufacturer stupidity giving me a phone which needs a firmware update but by doing this voids the warranty offered by the service provider! Nokia can fix the bugs in it, but Orange won't let me!

Apple's phone will not be free of bugs out of the box, but it will employ an excellent UI that makes it a combination great music player AND a great phone. I'm not expecting it will be a smartphone crammed with features. But most people I know don't really want one of those anyway. Instead, Apple's phone will be another piece in the jigsaw of the Apple experience. Mac users may be expecting the Apple phone to work wonderfully with their Mac, but that is still too niche of a market. Instead, Apple's phone will add another dimension to the iPod ecosystem and to Apple's own broad media everywhere strategy. It will deliver its key functionality equally whether to a Windows user or a Mac user. It will do this by leveraging iTunes - the third strand in how Apple will differentiate the iPod Phone from others. Note how synchronisation and updates moved into iTunes itself with version 7. This is key for the phone strategy - where contacts, notes, photos etc arguably have more importance. It stands in sharp contrast to the mixed bag of applications in the Nokia suite for instance. Apple's phone will embrace the third party iPod add-on market to allow people to add functionality they need that is not part of the basic phone.

But these alone are not enough to make the iPod Phone a success. And, for that, Apple still has a few tricks up its sleeve. It will not just have great synchronisation features, it will bring something new. It will do this by making one assumption most phone manufacturers don't make - that the user will have a PC (the iPod does this obviously). One of the applications I love and have written about before is Salling Clicker - an application which turns many phones into a remote control. A year ago, Clicker v3 added support for PCs and also could be used over wi-fi networks (extending range compared with Bluetooth, and allowing control of multiple machines). I am going to go out on a limb and predict that the Apple phone will include remote control software built-in allowing control of a set of PC and Mac applications (obviously including iTunes but also applications such as Powerpoint, and iPhoto), and probably also working with iTV and a FrontRow style interface. It is a long shot but I wonder even if Apple have hired Jonas Salling or bought the company for while Jonas continues to support the product well via forums, fixes etc. it's been pretty quiet since the last release a year ago! In any event, expect the iPod Phone to do things with your PC and Mac that no phone has done before (at least not without a lot of add-ons and tweaking).

Imagine a phone that when you walk in the door, switches your iTunes on, or tells you how many email messages you have? Or, a step further, downloads your new podcasts to the phone? Synchronisation and control are two areas where the iPod Phone will make a leap over any other device today.

If I'm wrong about this direction, then the other direction Apple will take the phone will be in data. I'm not sure in the first version of the phone we'll see a lot here because of the need to support multiple network types and to work out arrangements with service providers. But it may well have a few things up its sleeve - perhaps in limited markets. Safari's underpinnings are already the basis for Nokia's latest browser. One obvious area is mobile iTunes - especially for instance for almost realtime podcast downloads. But I'm not convinced Apple will jump into this area immediately (partly because many of the data features being talked about would require 3G speeds, and potentially expensive contracts). Apple could build some mobile features into its .mac service, but again I believe this is too mac-platform centric. Instead, Apple might leverage it's burgeoning relationship with Google to come out with optimised pages for accessing mobile services - GoogleMaps, search etc. I've mentioned the possibility of location-based services before, and I think this is area of great potential (perhaps with an add-in GPS receiver). Another area Apple could build on brilliantly would be in bridging the gap between SMS and IM. A mobile version of iChat could be excellent here - especially if it also has wi-fi capabilities. As far as I'm concerned even just text features here would be valuable. Obviously, it would need to make sure this was interoperable with the AIM network, and ideally with others (GTalk?). If Apple can introduce data features that people will use, then it will start to win the support of mobile service providers. Maybe not the dominant ones who believe (wrongly) they will be the source of content, but those who realise that the best thing they can do is to get the masses using data. SMS took off in spite of the service providers - and certainly because it was not controlled by them. It could well be a company such as Apple who shows the service providers the way for data by giving users features that they want and - most importantly - find easy to use.

If Apple can demonstrate a game-changing device, then it has the potential to cause a sea-change in the relationship between handset maker and service provider. The ludicrous subsidy system which ends up hiding the true cost of calls, and results in massive environmental waste due to 12 month phone replacement cycles, could come to an end. Handset makers could once again compete on features and appeal directly to end users, and service providers could compete on the actual services they offer.

I think the biggest challenge Apple has is that with one or even two models, it will not be able to please even a majority of critics out there whose ideal phone ranges from ultimate Blackberry/Treo down through 3G smartphones, through music/camera-oriented devices, down to the slimmest and sexiest small devices. Apple's success - in the same way it initially targeted only hard disk MP3 players, ignoring the larger flash market will need to be judged at least initially on how it does next to similar types of devices.

To recap, I believe that while Apple has some significant challenges to enter this market and its success is by no means assured, it will bring a device that is sufficiently differentiated from the competition to offer the discerning user a proposition worth paying for. It will do this through design, UI, synchronisation and control, and perhaps new applications. If the first device is priced reasonably (therefore it will not likely be a high-end, feature-laden device), it can become popular, and lead to a family of devices which service providers will warmly embrace, or risk losing customers. It can also become the catalyst for the widespread adoption of data services that the service providers actually crave but have been unable to kick-start. How will we judge it's success? Microsoft has said it will be happy to sell 1m Zune's by June. I think if Apple can sell 1m iPod Phones in a similar period, it should be considered a success. What do you think?

Look out for a few more Apple articles over the next week or two covering MacWorld, financials and the challenges ahead.

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100 greatest jokes

I came across this site over Christmas (I think from DaringFireball), and had been meaning to include it in some post. But it's too good to keep to myself. You may not like all of them, and perhaps it's got some great jokes missing, but you're sure to find something to amuse you and even bring back some memories.