Thursday, August 10, 2006

JupiterResearch:The iPod's Not a Music Player

David Card at JupiterResearch continues the discussion on whether Microsoft's (MSFT) Plays for Sure is dead that was started by his colleague Michael Gartenberg. He thinks "going head to head with Apple (AAPL), for what isn't really a music player, but a consumer-fashion fetish object, does not play to Redmond's strengths."
Card writes that:

today music players are not about closed loops. They're about accomodating existing MP3 collections (which Apple did best, if not first). Who cares about paid digital downloads? They make up less than 15% of what's on a user's iPod. If the business were really about what I believe is a totally new way of discovering and using music, that is, supporting subscription services like Rhapsody, Napster, Yahoo, and AOL -- then perhaps multiple closed loops make sense. But that business is still emerging -- it's certainly not driving device sales -- and I suspect it would be better supported by compatible devices. So far, none of 'em work very well.
Card concludes with:
The only way I see a sustainable dedicated music player business is if it totally re-invents music usage again, post iPod, which already did so. The jukebox in the sky could be a gamechanger, though not in 2007 or 2008. Or if it totally commoditizes the technology and acts as a Walkman replacement. Walkman replacements shouldn't cost $200.