Jupiter: Thoughts on the iPod Video

Jupiter analysts Michael Gartenberg and David Card share their thoughts on today's Apple video iPod announcement via several posts at the Jupiter Analyst Weblogs. Gartenberg remarks that until now there was interest in mobile video but "there have been a few hurdles that have plagued adoption. Most notably, they come down to three issues; form factor and battery life, which are both consumer priorities in mobile devices and most importantly, the lack of legal video content."

Gartenberg believes Apple has overcome these three issues and then goes on to state:

Unlike prior devices from other vendors, Apple is focusing on the core music experience first. These are first and foremost iPods, they're not compromising on the music experience in order to deliver on the video and therefore the additive function doesn't detract from the core function. Most importantly, Apple gets over the biggest issue with lack of legal video content. We've argued in the past that Apple would introduce a video iPod but would not introduce one unless there was a way of making mass market content available. By providing premium downloadable content that consumers are interested in through a proven delivery vehicle, Apple now has finally overcome the major barrier that has plagued these devices in the past.

In a followup post, Gartenberg points out that "Apple started the iTunes Music Store with 200,000 songs (and no Madonna). Now it's 2,000,000. You can bet lots of folks are buying plane tickets for meetings in Cupertino. Of course, now that Apple cracked this market, there's opportunity for some other folks as well to get in on the game. Of course for the enthusiasts, I'm sure they'll be all sorts of solutions for getting existing content onto the new devices."

David Card takes a slightly different approach to the video iPod. First, he doesn't think "there's much reason to combine video and music in the same application. Seems to me the experiences are very different -- and you risk compromising them -- and the user interface -- by mingling them. Wait till recommendations engines make suggestions with radio and clips that scroll by as you watch passively. That might be tough to blend."

He does like the $1.99 pricing for video and the "one copy/purchase that plays on a bigger screen and on the portable device. Simplicity helps a lot when launching a new market."

In his second followup post, Card gives the following reasons why the "Video on an iPod, for sale in the iTunes store will not revolutionize filmed entertainment:"

• There's far less demand for portability
• Consumers don't have existing video libraries that can transfer easily
• Piracy is an issue, but not like music
• There's minimal demand for short-form content; no demand to disaggregate a movie into scenes compared with an album into singles
• No price break-through
• DVDs and movie purchasing are still relatively new, though momentum is slowing
• Digital TV and HDTV are growing strongly
• The industry is aggressively pursuing on-demand offerings and experimenting with new business models already