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Do U need an iPod, 2?
I have a friend who is such a huge fan of U2 that yesterday’s news about Apple inking an agreement with the superrockgroup may have filled her with some joy (just look at the new iPod. That’s a recipe for fan joy if I’ve ever seen one), but also with incalculable dread. In her mind, dollar equations were already spinning. “Where am I gonna get $349, now,” she was asking herself. She started thinking of her Christmas list; could she wait until Dec. 25 for such a “Gotta-have-NOW!” gift?
The new red-on-black iPod is certainly tasty, a salivation-worthy device that scratches both the techno-age itch and the rock’n’roll color scheme ideal that makes it even cooler than the pastels of the iPod mini or the pure white-on-silver of the iPod classic. One imagines that if the tie-in had been with the White Stripes instead of U2, fans would be wondering whether they’d want to spend $349 on a candy-cane colored iPod.
More intriguing than the new music player itself (or the new color-screen photo-viewing iPod, more on that below) is the music package that U2 and Apple have put together. For $149, you’ll be able to download 400 U2 tracks, including about 25 rare or unreleased songs. Did I say my friend was freaking out? She was freaking out.
This announcement is important because it marks a turning point in Apple’s dominance of the music downloading business, and likely not a turning point toward defeat. The smartly packaged deal may seem overpriced (what hardcore U2 fan, it’s fair to ask, doesn’t already own at least 300 of those tracks on existing CDs?), but buying the special-edition iPod knocks the price of the download package to $99 with a $50-off coupon, which would seem like a good tipping point for fans on the fence.
Apple, it seems, picked the right band — a mass market group with a huge base of fanatics as well as incredible mainstream appeal. Their last album did exceptionally well and there’s no reason to believe their next one (at least based on the strength of the first single, “Vertigo,” featured prominently in Apple’s newest ads) won’t do just as well.
The deal points to a future where smart companies can pair with well-respected artists to offer content to fans that traditional retailers never could.
So what could stop the iPod juggernaut? At one point, I would have said pricing; but Apple smartly dropped its base cost to $299 for its lowest-end iPod and will probably do it again for its pricier iPods if competitors catch up in design or usability (an uncertainty at this time: nobody else has yet come close).
A big question mark, though, is Apple’s concurrent announcement that it’s releasing a new iPod that can display digital photos, the iPod Photo. The two models, a 40-gigabyte for $499 and a 60-gigabyte for $599 seem far too pricey for all but the most elite of the Apple faithful. Apple’s mistakenly overpriced its products in the past, most egregiously in its computer lines, leading customers to flock to cheaper models, in effect leading the company to lose its lead in the computer industry.
What they’re betting on is that the need for people to carry their photos with them in digital form, something that has never really taken off in the PDA market, will make the new iPods worth it for the extra $100 to $200 someone would spend on it. Here’s their trump card: Have you ever seen a group of friends crowd around a digital camera’s tiny LCD screen to look at photos that have been taken? Apple is betting on that kind of utility.
And based on the clumsy efforts of its rivals like Sony, Wal-Mart and Rio in the MP3 player and music downloading market, this could be Apple’s moment to stumble on the high end, or continue to pull even further ahead in the market and beyond the reach of its competitors.
Permalink | | Categories: By Omar Gallaga
