The Apple Syndicate--Are iTunes'-iPod's Best Days Ahead Because of Syndication?

Today iPods and iTunes rule the portable audio and video content world. But does Apple's majority reach into the consumer space hinge on syndication technology? I think so...



I was quoted in an 11 February 2006 article in The Salt Lake Tribune written by Bob Mims about the impact FLASH memory will have on companies manufacturing FLASH, and on the result for consumers. He also cited Dan Francisco of Micron, Celeste Crystal of IDC Research, Nam Hyung Kim of iSuppli, and Don Barnetson of Samsung.

Mims (also a blogger), a reporter noted for doing his research while covering "technology, biotech, fraud, profiles" for 'The Trib' posed two questions to me while writing the article.

Understanding that Mr. Mims has word count and column inch restrictions for his stories, yet knowing myself well enough to realize I never say in a paragraph what can be said in a page, I'm sharing with you my entire response to his questions.

First he asked for my "off the cuff reaction to (1) the possibility of higher-capacity chips giving the ability to store 10s of hours of video and hundreds of hours of audio, and being able to burn and or buy movies on flash chips by the end of the year."

To which I replied:

"If Apple maintains cost parity and adds benefits like better battery life, better reliability, and increased durability, NAND flash makes great sense for the iPod installed base looking to upgrade. Since I’m part of that installed base, this appeals to me to be sure.

"Offering consumers legally pre-installed content may just deliver the “revenue hockey stick” Apple (and it’s shareholders) are looking for. They could easily increase market access by making cool stuff available to users who are uncomfortable with the “hook it to a PC, go on-line and use iTunes” content delivery experience. Once these consumers get a taste of this new way to access content, their aversion and pain threshold for the on-line experience may be decreased. Either way it means more revenue for Apple.

"In short, this may be just the next move to secure Apple's market dominance while growing the size of the addressable market at the same time. It's a great strategy."

Second, he asked "how important is it to [iPod users] to stay on the cutting edge of such technology?"

And I said:

"This is a classic Apple question and challenge. Apple currently dominates the market because the iPod user experience is so buttoned up through Apple’s mastery of integration. As the technology building blocks for MP3 players (like NAND flash, displays, interface) improve and the interfaces for these building blocks standardize, the battle for Apple will shift from the technology in the device to the technology that distributes delivers content to the device. Apple (or should I say Jobs) seems to have anticipated this nicely with their content relationships with the recording industry and now the television industry. Content truly is king in this market.

"This is going to remain a really interesting market, and whatever happens the consumers are going to come out on top. What a rush!"

After giving my responses, I had this additional thought: As syndication is a big part of the iTunes delivery system (particularly when you “subscribe” to a podcast) and the iPod experience, I can't help but think this is where eventually hundreds of millions (rather than today's tens of millions) of users will come from, and they'll come subscribing.

The thought reminded me of one of my very first posts where I talked about the evolution of the web from browse to search to subscribe. I think the web evolution we call syndication is really tied to the long-term value proposition for iTunes and the iPod.

What do you think?