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“The new iPad” introduced yesterday might better be called the “somewhat improved iPad”. So named by Apple in lieu of a model number, this iPad has a better screen, better processor and 4G connection speeds — but nothing to “wow” its fan base.
But Apple’s still likely to sell many millions of units, adding to its early dominance of what CEO Tim Cook calls the “post-PC era”, where “the PC is no longer the center of your digital world but rather just a device.”
How will content fare over the next year or so in that new era, and what will the iPad’s role be?
Here are a few predictions:
Books will increasingly be replaced by tablets. All trends point down for physical book sales, while ebook sales are booming. Apple will probably go neck-to-neck with Amazon in this realm, although Apple will likely dominate interactive textbooks; the late Steve Jobs launched an interactive textbook initiative that plays off Apple’s traditional strength in classrooms.
Tablets will become the preferred portable video device. The advantage of tablets over notebooks or DVD players for watching video is obvious: instant on, longer battery life, better portability, no need for DVDs and (vs. notebooks, anyway) generally cheaper prices. Apple’s price drop yesterday for earlier iPad versions ensures that it will remain the back-seat-DVD-player-replacement-of-choice for the time being. One caveat: new notebooks that imitate the iPad’s characteristics — particularly the new MacBook Air — could cut into that lead.
Some media outlets will finally score big on tablets. So far, iPads have largely been vanity plays for newspapers and magazines, which can’t yet point to significant profits from tablets. But for those who can turn the lack of printing and distribution costs to their advantage, there’s a huge opportunity. The Daily, the tablet-based newspaper started a year ago by Rupert Murdoch, has 100,000 paid subscribers and appears within sight of profitability.
Tablets will not be the preferred platform for music. However small they become, tablets can’t compete with phones or iPods for portability; and screen size is much less important for music than it is for video. In the home, someone who wants to listen to music without headphones is more likely to listen through their computer speakers than their iPad. At least, I do.
The new iPad will increase the pressure on dedicated gaming devices. This iPad has 2,048-pixel-by-1,536-pixel resolution, equal or better to most HDTVs. In addition, it’s fundamentally easier to use than game controllers, or Sony’s just-released Vita gaming device. Plus, plenty of games are free. For general purpose game playing, that should work just fine. Why spend hundreds of dollars on consoles or portable game devices if you’re not a game fanatic?
It’s a tempting argument, given Comcast’s launch this week of Xfinity Streampix, a service for streaming TV reruns and old movies. That sounds an awful lot like Netflix’s bread-and-butter. Both companies have 20 million-plus subscribers and would love to cannibalize each other’s viewers.
But Streampix and Netflix are fundamentally different plays. Streampix is currently offered only to Comcast customers, and its main purpose, if I read the news right, is to prevent churn — subscribers flying to services like, well, Netflix. That’s a legitimate worry, since Comcast’s subscriber numbers are trending down.
Netflix sells its service to anybody, and while its certainly worried about losing subscribers (remember how it lost a few million after its snafus last year?) it doesn’t link its $8-a-month streaming service to a gargantuan cable package like Comcast’s roughly $140 per cable sub.
Comcast actually has the nerve to charge current TV subscribers $5 a month for Streampix if they don’t get Comcast’s cable-TV-Internet bundle. This for a service that has far fewer titles than Netflix. Why would even a Comcast subscriber consider it if all they’re saving is $3 a month?
Meanwhile, Netflix is busily adding to its own programming, such as a multi-year deal with the Weinstein Co. to stream movies such as “The Artist”, and original programming such as “Lillyhammer” and five other shows in the works, according to the L.A. Times.
The upshot: Netflix is still playing offense and Comcast is playing rather shoddy defense. If I were Reed Hastings, I wouldn’t be losing too much sleep.
If you ever had any doubts that we’re moving from an era of technology markets to technology ecosystems, Google’s latest news should quash them.
Google is quietly creating a branded entertainment hardware system that will wirelessly stream entertainment content throughout the home, the Wall Street Journal reported. In so doing, Google’s taking a page from Apple, Amazon, Barnes & Noble and a coterie of others who hope to control the flow of digital content.
Once you’re in Google’s ecosystem, you’ll presumably be able to stream or download any movies, TV shows, books and games you’ve bought from Google or stored on its servers.
Not surprisingly, Google’s also reportedly close to launching a cloud service that will allow you to sync your content across multiple devices, competing directly with Apple and Silicon Valley startup Dropbox.
The interesting question is how open Google’s ecosystem will be. To date, its kept the barriers to entry to its Android platform low — compared to Apple and Amazon, which take a piece of everything that flows through their hardware.
Google differs from Apple and Amazon in one key respect: most of its revenue comes from search. So it has an incentive to give away content for free or very little, as long as it gets to insert its ads.
Google does have one other massive competitor with a closed ecosystem who makes most of its money from ads: Facebook. Can a Facebook entertainment device be far behind?
It’s another sad day for the L.A. Times, and Lord knows, there have been too many of them.
With Russ Stanton out as top editor, the Pulitzer Prize-winning newspaper faces a grim future of dwindling staff, dwindling circulation and dwindling revenue. The pending layoffs of up to 20 staffers (on top of 350 others over Stanton’s four-year tenure) were apparently the last straw for Stanton, who was also said to have clashed with the paper’s new digital editor.
So the fifth-largest metropolitan newspaper faces a grim future. Or does it?
Amidst circulation declines, Stanton built the paper’s unique online readers to about 17 million a month. If only those readers could be effectively monetized, and the importance of the paper portion of its business gradually diminished, the Times might mount a turnaround.
The paper is considering two ways to do just that: launching its own tablet; and creating its own pay wall, as the New York Times and the Wall Street Journal.
For the tablet plan to succeed, L.A. Times newspaper executives need to swallow the unwelcome truth that their customers want the tablet more than they want the newspaper. Cost and flexibility will be the determining factors: offering a free tablet to anyone who signs up for a one or two year newspaper subscription might well persuade many cost-conscious people to sign up. The tablet — probably some generic knockoff — would also have to offer music, TV watching, movies and other things consumers have come to expect.
For the pay wall to succeed, the newspaper would do well to look at the Wall Street Journal, not the New York Times. From the beginning, the Journal has enforced a strict pay wall – only paid paper or online subscribers get access to all content. Free site visitors can access only a very limited amount of material. The cost of all-digital access to the newspaper is a palatable $3.99 a week and the Journal is a joy to read on a tablet.
The New York Times’ pay wall, by contrast, allows viewers to have roughly 25 free articles per month, before being locked out by the pay wall. The pay wall is easy to circumvent: just start reading the newspaper on your smart phone or tablet when you run out on your laptop. A few simple modifications to your computer, and you can read the newspaper there, anyway.
What incentive does that leave for anyone to sign up for the New York Times? I haven’t, and I (guiltily) read around half a dozen stories a day.
The New York Times is also far too pricey. The digital version is $8.75, or more than twice the cost of the Journal’s offering. The proof is also in the pudding: the Journal’s online edition has been consistently profitable.
Unfortunately, the L.A. Times’ success with its tablet or pay wall strategies probably depends upon the newspaper tolerating some short-term cannibalization of its core newspaper business.
Better now, through a careful strategy, than bleeding out another few hundred thousand subscribers over the next few years in an unforgiving market.
So, I tested Siri, Apple’s iPhone4s voice recognition app, and here’s my conclusion: It ain’t a miracle app, but it raises the bar dramatically and sets the stage for a revolution in user interfaces for TVs, cars, and many other devices.
My tests weren’t exactly scientific — mostly involving shoving aside other customers at my local Verizon outlet and hogging the iPhone 4s for 15 minutes. But I think I got a good idea.
“Who is the president of the United States?” gave me a chart of all Barack Obama’s particulars. ”What’s the phone number for Apple?” surprisingly got me AppleOne Employment Agency in Los Angeles, but adding “Inc.” and “Cupertino” gave me the right answer. ”Where’s the nearest Chinese food in Culver City?” gave me maps and directions for places 3,000 miles away from my little town, but changing the place to “West Los Angeles” worked fine.
When I asked “Who’s your Daddy?” Siri replied “You are.” But, of course, that’s pre-programmed and I read that in a news story.
The point is, Siri is miles ahead of any other mobile phone voice recognition program on the planet. On my current iPhone4, if I ask it to call my local bike shop, I end up calling someone I haven’t talked to in 10 years. I ask it to play songs by “The Beatles” and it plays songs by “The Eagles”.
Siri’s accuracy level isn’t superb, but it’s a lot better than that. It means you can now realistically manage tasks in your car like playing your favorite songs, calling people, getting directions and sending simple messages to people without taking your hands off the wheel.
As I mentioned in a previous blog, this has huge implications for other devices. It means that Siri or a similar artificial intelligence-enhanced system, can easily manage your TV set. “Turn on the Dodgers game”, “Play the third episode of “Bones’ from this season” or even “Scan Netflix to see if it has the original ‘Planet of the Apes’ movie and if it isn’t rent it on iTunes” become totally doable.
It’s not much of a jump from there to “Turn on the lights”, “Set heat at 73″ and “Pre-heat my oven”. “Minority Report” had those kinds of things in 2040; we’ll have them now by 2020, and maybe a lot sooner than that.
But it’s TVs that could see the biggest initial impact after cars. The connected television — TV hooked to the Internet — is close to becoming ubiquitous, and Siri relies upon a Web connection to connect you with distant servers powerful enough to crunch your voice accurately.
Thus, it’s fair to say that several years after connected TV becomes ubiquitous, voice-controlled TV will become ubiquitous — especially if (as expected) Apple launches a Siri-equipped TV by the end of 2012.
Once that happens, I, for one, plan to throw my remote control in the trash.