The iPod wars (original) (raw)

Taking on the Apple iPod is a brave move. The iPod has claimed the moniker of the Walkman of the 21st century for its superb design, compact size, usability and, unusually for Apple, competitive price. Several manufacturers have tried but so far none have succeeded in loosening the all-conquering Apple product's vice-like grip on the MP3 jukebox market.

However what was once a niche product area is now moving towards the mainstream. Sony is predicting a huge growth in network audio (any personal audio device that plays MP3 files including CD and MiniDisc) in the coming year and several other makers have big plans for product launches in the area.

In Europe, Philips' HDD100 jukebox has enjoyed a degree of success, while US company Rio is looking at European launch for its range of players next year. Sony and Panasonic must be weighing up their options too. Yet how do you go about delivering a product that can steal sales from the iPod? Tricky!

Beat it on design - Philips HDD100
Central to the iPod's appeal to Windows PC rather than Mac buyers (who, lets face it, would buy the product if it was a huge brick with limited storage just because it sports the Apple logo) has been that, in terms of design, there has been nothing to touch the cool elegant lines and contemporary white finish of the player. Other jukeboxes simply look industrial. Philips has got close, though, with the black piano finish of the HDD100, and it's a design that other makers would do well to borrow ideas from.

Make a smaller player - Archos Gmini 120, Toshiba's GigaBeat
Portability is key for the MP3 jukebox market. At the moment the third generation Apple iPod is still the smallest and lightest player on sale in the UK. Although Archos is claiming its upcoming Gmini 120 is a tad more compact, while over in Japan Toshiba's GigaBeat is even smaller. Whether smaller players would attract more sales though is a moot point as consumers seem happy with the pocketable size of the iPod.

Offer longer lasting batteries - all the iPod's rivals
Potentially the iPod's achilles heel for the Apple device offers just seven or eight hours worth of playback time before the batteries need a recharge. Almost all of the opposition has at least 12 hours, while the Dell DJ, which has just gone sale in the US, has a battery life of an incredible 20 hours.

Add other music formats - most of the iPod's rivals
Most players are compatible with a range of formats from Windows Media Audio to the open source-based Ogg Vorbis. The iPod is MP3 and AAC (Advanced Audio Coding - a rival audio format to MP3) only. Yet formats other than MP3 will only start to establish themselves if they are offered as downloads for the internet. It is interesting to note how little used AAC is in the UK compared with in the US where it is the format for Apple's popular iTunes service.

Offer greater storage - Creative Jukebox Zen Xtra
Apple might offer an iPod with 40 gigabytes of storage - but it isn't the largest capacity hard disk on a personal MP3 player. Creative's new player has a capacity of 60 gigabytes and it sells for £50 less than the 40 gigabyte version of the iPod. As someone who has struggled to fill five gigabytes of music on my hard disk player, that amount of storage is probably only going to appeal to anoraks who insist on carting round their entire CD collection on a player. What could impact on Apple is that if a three to five gigabyte player became available that was significantly smaller than the iPod. Philips, Creative and Rio both have 1.5 gigabyte models that use the IBM Microdrive for storage. A player with double that capacity would certainly offer enough storage for most people. The rider though is that it would have to be cheap. The Philips product is far too expensive at £200.

Tie it in with music downloads - no one yet
Apple is likely to launch its iTunes service in the UK next year, further strengthening the position of the iPod. Were its rival Sony to offer a similar service it would certainly boost sales of the Japanese company's network audio products especially if the downloads used Sony's ATRAC system.

Get rid of the wires using Bluetooth - no one yet
French company Naf Naf Electronique is promising a CD player that comes with a wireless Bluetooth headset. This could be a killer feature for an MP3 jukebox as users could leave the player in their bag and still listen to their music controlling it via a remote integrated into their headphones. The problem is Bluetooth is expensive and this feature won't come cheaply.

Beat it on price - Ministry MOSMP028
Ultimately beating the iPod isn't really about price. There are now 20 gigabyte jukeboxes like the Ministry MOSMP028 that sell for around £200 - £50 cheaper than the 10 gigabyte iPod. Overall price seems fairly low down the list of criteria consumers have when buying an MP3 jukebox.

Add video - Archos AV320
Instead of taking on Apple, some makers such as Archos have decided the best route is to reinvent the product category. The Archos AV320 features video playing software and a four inch LCD screen in addition to its hard disk. Users can record programmes from their TV, or even DVD player, directly on to the hard disk and watch them later maybe on the bus or a train.

This is a market that is exciting Sony and Philips, both of which plan to launch personal video players next year. It has also got Microsoft going too, although the launch of its Media2Go format (now rechristened Portable Media Centers) for this product niche has now been put back until the second half of 2004. Of course Apple may get there first anyway. Its video iPod is rumoured to be one of the products it debuts at its exhibition in San Francisco in January.

So how do you beat the iPod? Well as makers have discovered attacking it on price, battery life and storage doesn't seem to get you too far. Ultimately users need a rival product that is of similar size and storage capacity, sports a great design and offers a Bluetooth wireless system, yet crucially is £50-100 cheaper than the iPod. And pigs will probably fly too.

A more sensible route seems to be reinventing the form factor of the product (its physical size and shape) by offering tiny players with three to five gigabytes of storage, or developing personal video players. Yet who is to say that Apple won't innovate in these product areas first?

Looks as if Apple still holds all the aces.