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Tech pundits are pointing out that Apple’s Steve Jobs made no announcement today as earth-shaking as the unveiling of the iPhone last year, and Mac devotees are trying to act as though everything he said was earth-shaking anyway. But none seemed to be talking about Job’s greatest single accomplishment: the maturation of his industry clout.
Forget the introduction of the iPhone last year, a mass hysteria not seen since the Beatles played The Ed Sullivan Show; forget the details of the new products and services announced today, such as the movie rentals, the new applications on the iPod Touch, and even the new MacBook Air, “the world's thinnest notebook.” Forget about the Time Capsule, the new wireless backup device.
Forget about the new Apple TV software.
Just look instead at the effect Jobs is having on other industries.
This started back in 2001, with the introduction of the iPod and the iTunes music service. The success of that combination was such that the music industry was finally forced to re-examine its business model and start selling music online. (All four big labels are now on side with DRM-free music sales, a move directly traceable to the success of the iPod and iTunes.)
Jobs then played hardball with music executives, among the most intractable business people around, who wanted Apple to introduce a sliding scale of prices for different types of music. Jobs put the kibosh on that so firmly that some labels won’t do business with Apple any more, preferring Amazon.com, in a move that smacks of petulance.
Jobs did the same last year with the iPhone, a device whose major drawbacks — it is solely a GSM device with an exclusive contract to AT&T — are forcing a lot of telecom service providers to restructure their data plans to accommodate the iPhone’s insatiable appetite for using Internet services. Canadian companies are being forced to make an earth-shaking decision of their own as a result: Revise their entire business model or lose the iPhone market.
This year, Jobs managed to get the backing of all the major Hollywood studios to rent films over the Internet. The movies will come over high-speed Internet connections some 30 days after they’re released on DVD, a move that should also entice a lot more U.S. on-line users to finally upgrade to broadband, no mean feat.
The deal he cobbled together with them will have more than 1,000 movies for online rental through iTunes by the end of February, at $2.99 for older movies and $3.99 for new releases. Users can watch the movies in real time over a broadband connection, or download and keep the movie for 30 days while having 24 hours to finish the movie once it's started.
And that should have the cable-TV providers sweating, because that’s the kind of service they’ve had some trouble delivering.
The service will work on Macs, Windows-based machines, iPhones, iPods or Apple TV set-top boxes. And that should make iTunes an even bigger force than before, which should make the record labels refusing to deal with iTunes appear even sillier.
Jobs’ accomplishment here is not the service, but that he choreographed all six major studios — 20th Century Fox, Warner Brothers, Walt Disney, Paramount, Universal and Sony — to agree, demolishing the biggest single sticking point for all matters dealing with Internet-based entertainment.
Ultimately, Jobs could have simply announced that when Apple speaks, everybody had better listen. He has been so successful at imposing his vision of a world circulating around iTunes that he is shaping not only Hollywood, the television industry and the cellphone industry, but also the music recording industry as well, which once believed that its near-monopoly was invincible.
Until they ran into Steve Jobs, that is.
And that’s the accomplishment we should be recognizing as even bigger than anything he said at MacWorld today.
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ginny ! from Canada writes:
never mind that he also beat Pancreatic Cancer...- Posted 15/01/08 at 2:53 PM EST | Alert an Editor | Link to Comment
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Mike - from Waterloo, Canada writes:
I generally agree with your argument, but where you say:
"All four big labels are now on side with DRM-free music sales, a move directly traceable to the success of the iPod and iTunes."
I disagree ... iTunes started off with DRM for all songs by the major record labels, and only introduced some non-DRM songs later.- Posted 16/01/08 at 6:50 AM EST | Alert an Editor | Link to Comment
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A C from Albertario, Canada writes:
Mike,
The thing is that it was Apple who introduced DRM-free music, not playforsure Microsoft or rootkit Sony.- Posted 16/01/08 at 12:06 PM EST | Alert an Editor | Link to Comment
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