Here’s some behavior I’ve observed over the last two years of watching Apple, especially after these announcements. First they’re down the last two days because they lowered the price of the iPhone $200. This market viewpoint is short-sighted because they just killed all their competition in the smartphone arena and they had really high margins to work with. The market (actually just the day traders who trade on rumors) saw it as desperation but will soon realize they’re going for marketshare.
This totally discounts the real story which is widescreen, touch, wi-fi iPods (predicted here a few weeks ago) which just left every other music/video player in the dust. Every iPod owner is going to want one of these for xmas if they don’t want an iPhone- my business partner is buying one because it means he does not need to carry his laptop to check email and web and he doesn’t need another phone contract. A typical early adopter response.
Now here’s how I think this will play out in the next few days (watch out , I’m crystal ball gazing!). Apple tends to rise late in the day (west coast effect- they know tech better). Today it will end the day close to even and maybe a little in the black. Tomorrow the realization of what they’re doing with back to school iMacs and Xmas markets will begin to set in and it will inch up all day to around 140, maybe higher depending on market conditions.
That’s my story and I’m sticking to it!
Semi-reliable (they actually do research instead of making things up like The Street’s Cramer) Apple rumor site AppleInsider offers a possible confirmation of my iPhone/iTunes/Mac OS platform theory with their story today about next gen iPods having full screens and a version of OS X.
It seems pretty obvious to me that the iPod as we know is evolving into something very different than that original paradigm changing elegant music player. As a brand, iPod is iconic and got there very quickly but the iPhone brand hit even faster even though, IMHO, it is much weaker as a brand with legs- since the device itself is so much more than a phone and will become even more so as Apple keeps upgrading the software.
Imagine an iPhone that includes these very likely improvements:
- True digital video with audio, lenses facing both sides of the device
- GPS tied into geotagged Google searches
- True IM over wireless
- Video conferencing via the above-mentioned DV and IM (iChat)
What they are doing is eliminating location as a prerequisite for socializing. This because they’ve recognized that things like social networks and blogging connect people regardless of location. When I started my climate change blog, I focused on local affects of warming and climate/energy issues. However it became apparent that because, today, everything is local; my blog was being read by people all over the planet, some of whom regularly communicate with me to the point where we plan meet-ups when we are traveling near each other.
Apple understands the significance of this much better that other device makers and software companies like Microsoft because they build for an enhanced future user experience- they are change agents in society. I think this vision and approach can be directly attributed to Steve Jobs. His legendary obsession with the user can only be driven by an equal obsession with predicting future human social behavior- they go hand in hand.
So what does this have to do with Supernatural Agency? It makes our business model possible. Mike is traveling this week and working from a beach house. I am in my office. We’ve launched two new sites this week without any need to be in the same physical location, in fact I’ve had no sense of anything being any different from when he is in town. This is the model Apple is enhancing with the iPhone/iTunes/ Mac OS platform strategy. Works for me.
We were at the bank today dealing with some stuff and I got into a detailed conversation with the bank manager regarding what we are doing. Because our media sites are dealing with a specific link between men and women (not porn and not dating!), I’ve been running my elevator speech past people to get their response, primarily with women, who tend to be a lot more pragmatic about business ideas.
This kind of research works if you are targeting regular people not web 2.0 geeks, bloggers and other technocrats. When targeting the man or woman on the street you don’t get to explain things, teach them about your idea or even spend more than a few minutes on it. You have to get right to the benefit, i.e. what’s in it for them?
Even better, once you’ve laid out your beautiful concept they should immediately start doing two things:
- Thinking of how their friends and family might use your service
- Offering ideas for helping you get off the ground
The woman at the bank did both. She loved the idea and immediately said she would tell her son about it, ‘because he does everything on the Internet’ and she offered some great feedback on a feminine response to the idea.
Now I’ve probably ran this concept past ten people in the past week and the response was completely the same. So even though it may not be the most technologically sophisticated idea we’ve ever had, it has the broadest market imaginable and people get it in two seconds, very often interrupting me to tell me what a great idea it is.
So what practical purpose does this serve beyond ego-gratification? I’m a marketer and I know that marketing a complex story to a wide audience is practically impossible. Telling about a very simple solution that anyone can benefit from is a lot easier. For example:
- Google. Go to a page, enter a question, find a good answer.
- Apple. Their current ad for the new iMacs has no messaging- just a beautiful flight around the elegant thing. Their iPhone launch ads showed exactly how easy it was to do stuff with it. Dead simple and they had everyone talking, not just the gadget freaks.
We don’t want to fight for attention. We just want to simply explain what it does and why you’d care. My ‘research’ is telling me that is going to happen. I’d recommend the same approach to anyone with a new idea for a business. If a regular person has no idea what you’re doing, you need to refine your message unless your target audience is nuclear physicists or uber-geeks.
With Facebook and Netvibes creating versions tailored to the iPhone, it is increasingly obvious that this is not a phone, it is a platform for communications including social networking, feeds, phone, sms, web, etc. The other phone makers can’t duplicate this because they don’t have a rigorous operating system or a browser like iPhone’s Safari and the mobile operators remain determined to cripple features and break this universal access down into pieces that they can rent by the minute.
iTunes is also a platform for exactly the same reasons. It is a platform for serving rich media content and, once again, the key is one price for music without the draconian idiocies of the record business who would force us to buy crappy albums to get one good song and give up our legal right to share music we’ve purchased (within reason).
Now we already know the Mac is a platform but for what? It is a platform for creating the content made accessible via iPhone and iTunes. It comes with phenomenal creation software for free, includes built in video and audio recording inputs and syncs perfectly with the other devices.
Now you’ll note that I don’t mention iPod. That’s because it is going to be superceded by iPhone as a player. I think you’ll be able to buy an iPhone for Internet and iTunes use with the option to activate phone use in the near future- it simply makes too much sense from a strategic POV.
So there is an amazing strategy in place here. Apple owns the entire ecosystem: Content creation, content distribution, communication across all channels. If I were Microsoft I’d be nervously looking into the rearview. As crazy as it sounds, with iPhone, Apple has completed the loop and it will be very difficult for others to get in on the action.