A Wider Net

Steve Jobs’ 2008 Macworld keynote came and went the other day, as did my carefully written post about it. So upset was I, at accidentally overwriting half of it, that I shelved it until today. Ever been there?

Anyhow, I felt that having just written a retrospective comment about last year’s big Macworld revelation, the iPhone, it would seem logical to follow it up with something about this year’s keynote. This year’s keynote had it’s share of major announcements, although none of them quite as significant as the iPhone and none of them were strong enough to keep the stock market from plummeting that day on bad retail news.

Here were the major points from the keynote:

- iPhone and iTouch will get new software. The iPhone gets a free firmware update including a Google-driven mapping system that creates GPS-like functionality without actual GPS hardware in the phone. It works by triangulating the position of the phone from three nearby cell towers. Run out of nearby cell towers, and you run out of functionality for this service. Presumably you will also run out of roads to choose from anyway. The iTouch gets a suite of applications that should have been on the device to begin with including mail. The early adopters get to pay $20 for the update while new buyers get it for free. That’s two slaps in the face to early adopters in a year. Goodness, this brand is teflon.

- Apple TV Take 2 - A new, cheaper version of Apple’s set top movie and TV download-and-player is now able to operate without a Mac. So the price drop from $299 to $229 is actually a price drop from $2299 to $229 - if you count the previously necessary Mac. It also can download podcasts, designed for a 2″ screen, and feed them to your HDTV, maybe a 40-60″ screen. That will be a bit like looking at dust mites under an electron microscope - really nasty when magnified. Kudos to Apple, however - this service has a chance for success with every major studio already on board.

The significance of this product is amplified by the fact that Apple also announced a new laptop (See below) and neither the laptop nor the Apple TV box contain any support for Blu-Ray or HD-DVD. Apple has quietly yet profoundly declared the high definition optical disc format war, recently claimed over and won by the Blu-Ray camp, totally irrelevant. Downloads are the future. Microsoft was thinking the same thing, as their XBOX movie and TV download service had managed to grow to twice the size of their nearest competitor. This will certainly impact our video production and media authoring plans in the near future. I am very interested to know what the cable TV industry has to say about this product. I suspect they have something cooking.

I am also a little surprised that Apple TV has no user-rating functionality (at least, I don’t think it does). This is a big part of YouTube, and even Blockbuster and Netflix allow users to rate their content. The lack of community and peer recommendation within Apple TV and, for the most part, iTunes continues to disappoint. In fact, it doesn’t even appear to have preference-based recommendation engine like Blockbuster or Amazon. They seem to be completely blind to the process of media discovery by users.

- New Laptop. Easily the biggest news from Steve Jobs was the unveiling of the MacBook Air. An impossibly thin yet technically superior machine, the MacBook Air is as beautiful as it is respectable. It is a green machine (mostly biodegradable or biorenewable), and it is a pricey machine ($1,800-$3,200 ish). While the trend in notebooks has been toward the cheap, Apple and, to a certain extent Sony, have opted to maintain premium models to keep up their brand image.

You can check all this stuff out, and more, at Apple.

The keynote seemed to drain the life out of the whole internet. Everything ran slower. It worried me that all these new iTunes movie rentals are coming through Akamai, the same delivery network we were using to produce a live webcast at the same time as the keynote.

Footnote: The coverage of the keynote was extraordinary. Apple refuses to webcast the event, which is beyond belief. Instead, a legion of live bloggers, twitterers, and phonecam streamers delivered us the news guerilla-style. And it looked bad. Apple should really control the way it looks, and if they can’t keep a lid on it, they may as well broadcast it or allow it to be done right. This blog even listed all the top coverage and updated it in real time with the status, since many went down under pressure. QIK - a beta live phone webcasting system had a few brave souls trying to webcast it live, with very poor results. I still think they’re onto something BIG.

Last January, Apple deflated the giant CES press juggernaut by launching the iPhone a few hundreds of miles away at Macworld Expo. This year, a year after it’s unveiling, CES suffered the same scene-stealing effect, and Macworld hasn’t even happened yet! Dozens, and it felt like hundreds, of new cell phones were unveiled at CES and almost everyone one of them was compared to the iPhone. Surprisingly, the general consensus seems to indicate that not one of them beat, or even matched, the iPhone.

You have to admire Apple’s brand strength and the game-changing ability to shake up an industry that Apple had no prior experience in, and according to some technical analysts, no business being in at all. If you perform a Google search for “compared to iphone CES” you will find pages of search results showing a sample of the comparisons being made between the products at CES 2008 and the iPhone from Macworld 2007 (which, I seem to recall, had more features than the version that ultimately hit the streets).

Perhaps the most astonishing thing is how crappy the phone really is as a phone. Similar to the iPod, it falls short compared to its competitors in many ways. No support for Exhange or Lotus Notes makes it terrible for enterprise users. The browser can’t play flash movies so they conned YouTube into making special versions of their most popular videos just for iPhone users. The memory is very limited and it has no expansion capability. It has zero physical buttons - a mistake that pretty much every wanna-be at CES was not willing to make. And most importantly, it’s stuck on AT&T which, according to most users and Consumer Reports, is in a dead heat with Sprint for the bottom of the barrel for quality and service. Not to mislead - it’s a marvelous product in many ways, too. Its combination of small combined with easily the most intuitive user interface and robust media capabilities make it a delight to play with.

I am particularly grateful that Apple entered this market, even though I will never get one as long as they are stuck with AT&T. The changes in the phones that have already resulted form their entry are remarkable, even though a little short of being truly competitive from a gadget sexiness perspective.

What can we, as marketers, learn from this? Two rather obvious things:
1. Customer loyalty can too easily be undervalued. Oddly, Apple built that loyalty with great products and great marketing but to my knowledge, they didn’t do it by publicly listening to them. You may find it easier and better to do it in plain sight.
2. Recognizing a market that is completely saturated with second-rate products like the previous generation of cell phones is good business. It’s easier to stand out when everyone else is wearing the same shade of gray.

Photo from All About Symbian

The Maxtor Heap was at Macworld, too. This interesting public marketing campaign was designed to position Maxtor’s backup solutions as a “life saver” because losing data, such as digital photos, can literally be like losing a part of your life. After seeing the heap of photos in the Las Vegas Airport, and the heap of CD’s at the Las Vegas Convention Center South Hall, and then the cityscape of CD’s at the Maxtor booth, I figured I had found the end of the rabbit hole. Apparently not: 500 miles later at Macworld, the home of the iPhone launch, I spotted another Maxtor heap (of photos). This time, the signs adjacent to the heap were adorned with small Maxtor backup drives permanently affixed to the signs. I guess they figured that the drives would have been stolen in Las Vegas too quickly (or maybe they were?)

I watched for a few minutes while waiting for the show doors to open and no fewer than five people tried to yank the drives off the signs. I dearly hope there was a hidden camera on this sillyness as it would make a great viral marketing video for YouTube.

Apologies for the blurry photo.

Macworld has ended, and by all accounts it was a huge success. The iPhone was announced there this week by Steve Jobs, and the whole world took notice. Sadly, Jay Leno mistakenly credited the announcment to CES, which is too bad for the Macworld show managers. I took a few photos of the show, which featured a tremendous collection of iPod accessories. One favorite, for which I don’t have a photo, was the George from Chestnut Hill Sound, which won Best of Show. It’s an iPod doc/speaker set with a detachable wireless control panel. The control panel can sit on your night stand and control the iPod remotely and through the alarm clock. It’s the slickest iPod stereo solution I’ve seen.