Burning at Both Ends

Any­one who has read this blog in the past (thanks, Mom!) knows that I’m a fan of Net­flix as well as the Fox Net­work show Arrest­ed Devel­op­ment. Today, Net­flix announced that it is going to be bring­ing back Arrest­ed Devel­op­ment in 2012 exclu­sive­ly to their stream­ing video ser­vice; firm­ly plac­ing them in the cat­e­go­ry of a pre­mi­um cable chan­nel. I’m also a fan of Apple and Ama­zon, who along with Net­flix, are busi­ness­es which rep­re­sent the future of the enter­tain­ment indus­try and media con­sump­tion, though in sig­nif­i­cant­ly dif­fer­ent ways.

Jon Gru­ber stat­ed the oth­er day that he did­n’t think Net­flix was capa­ble of cre­at­ing hard­ware to sup­port an “end-to-end solu­tion.” I don’t dis­agree that there’s essen­tial­ly no chance Net­flix will move beyond the app busi­ness and into actu­al hard­ware1. But I dis­agree with the notion that Apple and Ama­zon are pro­vid­ing end-to-end solu­tions. In fact, what Apple and Ama­zon are real­ly pro­vid­ing are mid­dle-to-one-end solu­tions. That is, they take con­tent licensed from a stu­dio and serve it over their sys­tems to their hard­ware2. Net­flix, how­ev­er, is mov­ing to the oth­er end by cre­at­ing con­tent to serve on their sys­tems to some­one else’s hard­ware plat­form via an app. In doing so, they get a wider installed base with no hard­ware invest­ment (which no one oth­er than Apple has real­ly yet to crack; though the Kin­dle Fire from Ama­zon is just a week old).

Net­flix has dab­bled with being a stu­dio in the past, or at least a financier of inde­pen­dent film. Their fold­ed Red Enve­lope Enter­tain­ment—which backed some real­ly great indie films—was a wor­thy try, but com­pet­ed against some of their bread & but­ter con­tent providers. While that fact has­n’t changed much, the stakes have. When Net­flix made the deci­sion to close their Red Enve­lope Enter­tain­ment divi­sion, the Apple App Store had just launched and the iPad had­n’t even been announced yet. That land­scape has com­plete­ly changed, with pre­mi­um net­work HBO hav­ing a real­ly ter­rif­ic app now that lets sub­scribers watch their shows on demand. The abil­i­ty to watch Game of Thrones any­time, any­where has sure­ly helped HBO’s sub­scriber num­bers and I think this is what Net­flix must have it’s eye on.

The price of Net­flix’s stream­ing ser­vice puts in the range with HBO and now Net­flix has the killer con­tent which will com­pel fans to sign up if they weren’t already sub­scribers. Thus they stand a chance to gain sub­scribers at the expense of pre­mi­um cable providers like HBO, espe­cial­ly among the grow­ing num­ber of cable-cut­ters (you don’t need a cable sub­scrip­tion to watch Net­flix shows; you do for HBO’s).

So, which is a bet­ter busi­ness to be in between hard­ware and con­tent pro­duc­er? I hon­est­ly don’t know, but giv­en the night­mare of con­tent licens­es all these tech com­pa­nies are hav­ing to nav­i­gate, I have a good feel­ing that pro­duc­ing pre­mi­um con­tent might be more as appeal­ing as get­ting into the hard­ware game. Though the mar­kets for iPads is essen­tial­ly the same age as the mar­ket for stream­ing video apps on such devices, the play­ing field among stu­dios looks a lot more leve than hav­ing to tak­en on a jug­ger­naut like Apple’s iOS devices from scratch.

You’re move, Ama­zon.

  1. This is the com­pa­ny that is rac­ing to dump phys­i­cal media, for one thing! []
  2. Note that, in the case of Ama­zon’s print pub­lish­ing, they are con­sum­ing the entire busi­ness between author an read­er. Now that is as much an end-to-end solu­tion as one could have, short of pro­vid­ing advances to authors. []

DVDs and iTunes

This has kind of been bug­ging me about iTunes for the past year or so. I had some tiny hope that it would be addressed in iTunes 9, but of course it has­n’t:

Why aren’t DVDs played in iTunes like CDs are, instead of a sep­a­rate uni-task app (DVD Play­er)?

iTunesCD

Okay, I under­stand clear­ly why Apple isn’t going to allow users to rip DVDs using iTunes. But iTunes has clear­ly moved beyond just audio (or Tunes, as it were) and now stores videos, movies, TV Shows, and even mobile appli­ca­tions. With iTunes Albums (for music) and iTunes Extras (for video), it has become the mac’s dig­i­tal media repos­i­to­ry. Some of the changes in iTunes 9 reflect this evo­lu­tion.

What makes this even weird­er is that DVDs are present in Front Row, which has always seemed to me like noth­ing more than a pret­ty, full-screen inter­face for iTunes. Why, then, isn’t DVD play just inte­grat­ed into iTunes? All of the extra fea­tures in DVDs could eas­i­ly be account­ed or with­out adding much to the inter­face with the same sim­ple con­trols any remote offers and the heads-up dis­play in iTunes video already has.

OS X has loads of inter­face incon­sis­ten­cies; most of which are eas­i­ly over­looked by the vast major­i­ty of its users (espe­cial­ly if they came from Win­dows1). How­ev­er, this is a func­tion­al incon­sis­ten­cy that seems con­fus­ing to me. As iTunes has now sup­port­ed video for some time, many users might expect a more con­sis­tent treat­ment of enter­tain­ment on an opti­cal disc.

  1. The way Win­dows treats DVDs is not only con­fus­ing, but actu­al­ly down­right pathet­ic. Win­dows Media Play­er will rec­og­nize a DVD and add it to the media list. That’s where the con­ve­nience ends, unfor­tu­nate­ly. That’s because Win­dows does­n’t come with a codec that will actu­al­ly play DVDs. Instead, you have to pur­chase a third-par­ty DVD Decoder, even if in the so-called “Ulti­mate” edi­tions. A cryp­tic error mes­sage indi­cates that you need to do some­thing to get Win­dows Media Play­er to play the DVD, just not what. And Win­dows Media Cen­ter (the equiv­a­lent to Front Row) does­n’t even show a DVD at all (though it might once you’ve paid for some­thing Microsoft should have includ­ed in the OS).Windows7_RC_Media Player []

Bad Week for New Telephony

It’s been a rough week for some of the high-tech tele­pho­ny solu­tions that I use every day. Name­ly, Google Voice on the iPhone and Skype. I use both of these at work most every­day: my “office” num­ber is a Google Voice line and Skype is great of over­seas calls and chat­ting with col­leagues.

This past week, news has arrived that Apple has reject­ed Google’s offi­cial Google Voice app in addi­tion to pulling the third-par­ty Google Voice apps from their iTunes App Store. Apple has faced a slew of com­plaints from devel­op­ers over their “brick-wall” tac­tics when reject­ing an app from their store (which, by the way, is the only offi­cial means of putting an appli­ca­tion on your pur­chased phone). But this appears to be the last straw on the devel­op­ers’ backs on which Apple has made a mint sell­ing iPhones1. At least one high-pro­file devel­op­er has had enough and is going to switch to devel­op­ing to the Palm Pre, the iPhone’s most recent would-be con­tender.

Yes­ter­day I also read that Skype own­er eBay and Skype cre­ators are in a legal bat­tle over the core tech­nol­o­gy and its future is in ques­tion. I’ve been a fan of Skype for some years now and have been impressed with the ease of use and qual­i­ty of fea­tures they con­tin­ue to add and improve upon in this mul­ti-plat­form appli­ca­tion (I use it on my iPhone, my home OS X desk­top, and my work Win­dows lap­top). It real­ly has risen to the top of a fair­ly large heap of VOIP and chat pro­grams in terms of qual­i­ty. I was pleas­ant­ly sur­prised that a num­ber of my col­leagues at Bent­ley use Skype for their inter­na­tion­al calls, as well. Find­ing anoth­er replace­ment for all those zero-cost inter­na­tion­al phone calls would be tough2.

And here’s the real kick­er: none of this comes down to an issue of engi­neer­ing or real­ly even cost3. These are sole­ly prof­it-dri­ven deci­sions. Is prof­it impor­tant? Of course it is. But these scorched-Earth tac­tics are real­ly ridicu­lous. Deny­ing con­sumers high-qual­i­ty prod­ucts for the sole pur­pose that they may reduce your prof­its does­n’t actu­al­ly help any­one. It just dri­ves cus­tomers away to some­one who is will­ing to be a bit more open.

As for me? I’m not jump­ing ship just yet, but I should point out that of my require­ments for a smart phone, none of them stat­ed that it had to come from Cuper­ti­no. Prac­ti­cal­i­ty will out-weight brand loy­al­ty any­day.

  1. Includ­ing the two in our house. You’ll recall that Angela and I only pur­chased ours after the announce­ment of third par­ty appli­ca­tions. Giv­en Apple’s There’s and App for that ads, I’m assum­ing they know this sells phones. []
  2. Though Microsoft Com­mu­ni­ca­tor may have some VOIP-like options, I tend to loath using it myself and it appears many of my col­leagues agree. []
  3. I swear I’m read­ing Chris Ander­son­’s Free as fast as I have time to and will write an exten­sive review ASAP. This issue will sure­ly come up. []

The iPhone SDK Announcements

Nat­u­ral­ly, the inter­net is glow­ing white hot with peo­ple talk­ing about Apple’s iPhone SDK (soft­ware devel­op­er kit) meet­ing ear­li­er today. Any­thing Apple relat­ed gets a lot of buzz, and iPhone news pegs the hype-o-meter. How­ev­er, lest I sound bit­ter, I think today’s announce­ments deserve the atten­tion. I want­ed to point out some of what made today’s meet­ing impor­tant.

Business-Conscious

There were three impor­tant items that showed just how seri­ous Apple wants to cor­ner the busi­ness smart­phone mar­ket. I don’t think any­one argued it was­n’t a huge mar­ket, but there have been some rather loud Apple pun­dits cough fan­boys cough who seemed to think that much of this was unim­por­tant to Apple and their mar­ket plans for the iPhone. I think it’s pret­ty obvi­ous that such a huge por­tion of the smart­phone mar­ket with some very par­tic­u­lar demands are either going to get those demands met or they sim­ply aren’t going to use iPhones. Apple is like­ly to com­plete­ly ignore them.

First, and most obvi­ous, is the fact that the iPhone is going to sup­port Microsoft Exchange e‑mail. This is impor­tant for me, per­son­al­ly, if I want to use an iPhone for busi­ness in any prac­ti­cal way (web mail isn’t what you’d call an effi­cient method of check­ing mail on the go). Not only is the iPhone going to sup­port it, they are inte­grat­ing it direct­ly. This is a much bet­ter imple­men­ta­tion than what RIM cur­rent­ly has for their Black­ber­ry phones. For Apple to have tak­en the men­tal­i­ty that because Exchange isn’t in-house (or sim­ply just because it’s Microsoft), they should ignore it, would have been a huge and cost­ly mis­take. Pos­si­bly at the cha­grin of many an Apple fan­boy, Apple is sim­ply licens­ing this pop­u­lar enter­prise tech­nol­o­gy from Microsoft; which is absolute­ly the right move.

Next, I found Apple’s choice of demo appli­ca­tions par­tic­u­lar­ly inter­est­ing. While they had the obvi­ous crowd pleasers like AOL’s Instant Mes­sen­ger, EA’s Spore, and Sega’s Mon­key­ball, they also showed off to apps for very spe­cif­ic busi­ness mar­kets: Epocrates and Sales­force. Of course, most of the inter­net just gave a col­lec­tive “uh, okay. And?” because these aren’t sexy or flashy pieces of soft­ware for the mass­es. In fact, that’s exact­ly the point. By choos­ing these apps for the demo, Apple sent a clear mes­sage to users of high-end, spe­cif­ic apps: We got your backs. Epocrates is wide­ly known among med­ical pro­fes­sion­als (just ask my wife1), who adopt­ed the Palm plat­form ear­ly on and have been with it for a very long time. Of course, as Palm slow­ly dies, they’ve got­ten lit­tle love in the Win­dows Mobile world. Now, Apple comes along and shows off some­thing that speaks direct­ly to them. Get­ting Sales­force on stage, I sus­pect, is the same for the sales peo­ple of the busi­ness world. The fact that most of the tech pun­dits have no idea what these pieces of soft­ware are, nor do they care, must feel like sta­tus-quo for the peo­ple in these mar­kets. How­ev­er, here’s Apple say­ing we care, guys. We care.

Last­ly, on the busi­ness side, was Peter Schiller’s response to ArsTech­ni­ca’s ques­tion regard­ing pri­vate orga­ni­za­tions dis­trib­ut­ing appli­ca­tions inter­nal­ly:

We are work­ing on a ver­sion of the App­Store for enter­prise that will allow cor­po­ra­tions to dis­trib­ute apps to their end-users secure­ly.

So, while it is essen­tial­ly true that the only method to get your app on iPhones is via the App­Store, Apple is rec­og­niz­ing busi­ness’ need to dis­trib­ute appli­ca­tions inter­nal­ly only.

So there’s the three things for busi­ness: first-class Exchange sup­port, show­ing off spe­cial­ized busi­ness apps, and open­ing the pos­si­bil­i­ty for inter­nal app dis­tri­b­u­tion at the enter­prise lev­el. Sure, most of the tech pun­dits don’t real­ly care about those things, except that they don’t rep­re­sent a huge chunk of Palm and Black­ber­ry users, do they?

VOIP

Anoth­er very short, yet very impor­tant piece of infor­ma­tion came dur­ing the Q & A. When asked about the pos­si­bil­i­ty of VOIP on the iPhone, Steve Jobs respond­ed:

We’ll lim­it them over the cel­lu­lar net­work but WiFi will be fine.

As well as when asked about deal­ing with the car­ri­ers (empha­sis mine):

We have a great rela­tion­ship with our car­ri­ers. We struck a new kind of rela­tion­ship with our car­ri­ers where Apple is respon­si­ble for the soft­ware on the phone. Real­ly, this is our pro­gram and we’re run­ning it.

So Jobs says VOIP is fine over WiFi and the cel­lu­lar net­works aren’t going to get to decide what apps get on the phone. Well, I’m not sure why you’d use VOIP over the cel­lu­lar net­work. VOIP over WiFi is there to replace voice over cel­lu­lar! Which of course, is why the net­works would­n’t want it there in the first place. Apple will, of course, be selec­tive as to what apps make it. They’ll be no where as bad as the cel­lu­lar net­works would be, though.

But is VOIP on the iPhone prac­ti­cle? I sus­pect there are a num­ber of urban users who could use Skype (etc.) over WiFi and nev­er even acti­vate their phone with AT&T. Of course, that’s a bit hypo­thet­i­cal right now since there are no VOIP apps avail­able right now and we don’t entire­ly know the specifics of how the App­Store is going to work. How­ev­er, I think the cel­lu­lar-less iPhone is not just pos­si­ble, but a real solu­tion for some peo­ple.

Small Developers

A siz­able por­tion of the apps on my Mac aren’t even to ver­sion 1.0 yet2 That is to say, they is a lot of great “Beta” soft­ware out there that is avail­able for down­load and, despite not yet being ful­ly baked, can be very use­ful. These are, by and large, from inde­pen­dent devel­op­ers who have big­ger ideas to offer than they have time to devote to. They want some­thing out there for folks to kick around (for any num­ber of rea­son, self-pro­mo­tion and pri­or-art argu­ments not the least of). How­ev­er, with Apple con­trol­ling the gate­way (just as I, and pret­ty much every­one else, pre­dict­ed), we may not see a lot of these poten­tial­ly use­ful lit­tle apps get­ting onto iPhones. I don’t real­ly know just how tight Apple is going gov­ern this. They may not at all, espe­cial­ly for the free apps. How­ev­er, giv­en they’re just now open­ing up the plat­form at all, I sus­pect they’re going to keep a pret­ty short guest list at the par­ty. Giv­en my desire to see long-tail apps on the iPhone, this would a real dis­ap­point­ment to me3.

I was real­ly impressed with the devel­op­er tools. I think Apple has pro­vid­ed a great pack­age. By doing so, and by stress­ing just how easy it is to devel­op apps quick­ly (how many times was “I can’t believe this was done in two weeks!” said?), they’re real­ly hop­ing to entice devel­op­ers quick­ly. Apple is doing a great job of bet­ting cus­tomers and devel­op­ers to come to the plat­form at the same time with this. Often, the devel­op­ers don’t want to code for a plat­form with no cus­tomers and the cus­tomers don’t want to buy into a plat­form that does­n’t have any soft­ware. Apple looks like their strad­dling that prob­lem with near per­fec­tion.

Regard­less, over a year after it’s first for­mal announce­ment, I’m ready to just go ahead and buy an iPhone. I may not do it tomor­row, but pret­ty much all my demands have been met. It’s time I just go ahead and drink the Kool-Aid.

So, any­one inter­est­ed in buy­ing a used 80GB iPod Clas­sic or Sony Eric­son W810i?

  1. Angela told me she is going to seek out the peo­ple at Lexi-Comp, Epocrates’ main com­pe­ti­tion, at her con­fer­ence next week. She’s pret­ty much going to tell them that either they get their app on the iPhone plat­form, or they lose her to Epocrates as a cus­tomer — and prob­a­bly many more like her. Then again, since the iPhone already has over 3x the mar­ket share of Palm smarthone users, they’re like­ly to do just that. []
  2. Some good exam­ples of sub‑1.0 soft­ware that I use fair­ly reg­u­lar­ly:

    []

  3. Of course, the obvi­ous solu­tion to this is just to call you’re first piece of soft­ware v1.0 — and nev­er have a 0.X “Beta” ver­sion. That’ll work, right, Apple? []