Satya Nadella’s unveiling of Office for the iPad is a significant moment for Microsoft, and his leadership of the company. I wonder if it will also be an incentive to improve the product itself?
I write this because Word in particular still strikes me as a product that is too big to fail. The network effect of so many companies using it makes individuals follow suit but it is bloated and irritatingly full of bugs.
Apple's iPad Mini
Who wouldn’t have wanted to be a fly on the wall when Apple’s senior executives were discussing pricing of the new iPad Mini? At $329 (£269 in the UK), the relatively high price now appears to be making investors nervous.
What would Steve Jobs have done? Overpricing of the original Macintosh computer – conceived as a $1,000 machine, which increased to $1,995 because of Jobs’ tinkering with the design – was one of the first big disagreements between Jobs and John Sculley, then Apple’s chief executive.
As Walter Isaacson writes in his biography of the late Apple founder, Mr Sculley’s decision in 1983 to add a further $500 to the price and charge $2,495, to help pay for the huge launch and marketing push, made Jobs furious: “It will destroy everything we stand for,” he said. “I want to make this a revolution, not an effort to squeeze out profits.”
Apple $60m settlement with Proview Technology of Shenzhen, the manufacturing city in the Pearl River delta, to gain undisputed control of its iPad trademark, shows how tricky controlling intellectual property in China remains.
China is still stuck between its official policy of moving to more innovation and protection of intellectual property and the sketchier reality on the ground. It remains very easy to buy knock-off Apple phones and components in the Pearl River.
Since he kept on repeating it, there was no difficulty in working out what Jeff Bezos regarded as the most important aspect of the Kindle Fire launch in New York this morning.
Mr Bezos gave a little smirk as he announced the $199 price of his new competitor to the Apple iPad – and to the entire ecosystem of films, music, magazines and books that can appear on Apple’s device:
“This is unbelievable value. We are building premium products at non-premium prices. We are determined to do that, and we are doing it.”
Sony’s launch of its first tablet devices is bound to excite unflattering comparisons with revolutionary Sony products of the past – particularly because it falls in the same week as the death of Norio Ohga, the Japanese company’s former chairman and chief executive.
As every retrospective of Ohga’s extraordinary life has pointed out, he was the Sony executive who helped establish and drive the compact disc. By contrast, Sony’s “S1″ and “S2″ (their temporary names, thank goodness), already seem doomed to be mere “iPad rivals”.
Amazon’s move to offer newspaper and magazine publishers 70 per cent of the revenues from selling their periodicals on Kindles is a testimony to the power of competition.
Amazon’s original terms were that it would take up to 70 per cent of the price itself, leaving publishers only 30 per cent. Since then, the launch of the iPad has given publishers an alternative – and one they are more excited about.
The iPad and other tablet computers may be the future (or at least part of it) for US magazine publishers, but it is making them confront an awkward reality – they have in effect been giving away their product for years.
The US magazine practice of offering extremely cheap subscriptions – often working out to little more than a dollar a month for a glossy magazine – is not only problematic in itself but is creating big difficulties for their digital initiatives.
The problem was nicely expressed to Women’s Wear Daily by Charles Townsend of Conde Nast, the magazine group that publishes titles including Vanity Fair and Vogue:
“Why will consumers pay 180 bucks a month for TV programming they never watch, don’t know the brands of, have no interest in, and will [only] pay a dollar a month for a magazine subscription to Glamour? There’s gold in those hills somewhere,” Townsend said. “How do I mine it?”
Well, there is a simple answer to that. They only pay a dollar a month for Glamour because that is all that magazine publishers charge. They have given away cheap subscriptions in order to establish a high “rate base” to attract advertisers.
Comparing the blockbuster Wired magazine application for the Apple iPad to other magazines on the device is faintly silly given its far greater size and ambition. You can get an idea of it from the promotional video below.
Frédéric Filloux has a smart prediction on the Monday Note (a recommended weekly email about media and technology, by the way) about how the iPad and tablet computers could change the book business and help longer-form journalism.
I have a couple of thoughts about it.
The platform wars have returned. The past few days have brought an outbreak of hostilities between Apple and Adobe, and tensions between Twitter and the companies that make software clients that let people tweet.
The facts are different, but the underlying story is the same. Many software and internet companies aspire to be platforms for which others compete to make applications and services. Becoming a platform entrenches them and (usually) their profitability.
The most famous beneficiary of such a network effect was, of course, Microsoft, which established Windows as the biggest PC operating system, and enjoyed years of growth as a result.
For a few years, the explosive growth of the internet – the ultimate open platform – has put many such rivalries into abeyance. Now, they are rearing up again.
Further to my column on the iPad, I’ve also been able to make a comparison between Apple’s device and Amazon’s Kindle. The brief answer is: for periodicals such as digital papers and magazines, the iPod is better; for books, the Kindle still wins.
I’ve written before about the experience of reading papers such as the FT and the Wall Street Journal on a Kindle and have come across devoted readers – mainly senior executives in global companies – who are attached to reading the FT on their Kindles.