Microsoft's Ad Campaign Highlights the "Real" Truth

Microsoft’s TV advertising efforts over the past year haven’t exactly been running on all cylinders. For starters, the infamous Jerry Seinfeld/Bill Gates commercials were uncomfortably creepy. Next, the “I’m a PC” response to Apple’s Mac/PC commercials came across as defensive. The latest ad from Microsoft is much more strategic and direct. It features a young woman named Lauren who is tasked with selecting a new notebook for up to $1,000. Anything under – she keeps. Lauren explores both the Apple store and Best Buy and determines that a $1,000 laptop from Apple doesn’t meet her needs. Lauren has decided she’s “not cool enough to be a Mac person” (sour grapes?) and selects a PC for $700. The story has generated a tremendous amount of discussion and disgust in the diehard Apple camps.

While the commercial does a lot to generate conversation about the value prospect of each platform it doesn’t make a difference in consumer selection of a Mac or PC. To understand the debate we have to strip away the labels of “Mac” and “PC”. This is not about being cool or not being cool. Fortunately for Lauren and other PCers, computers don’t define coolness. Truth be told, as demonstrated by this new ad, is that when all is said and done people select computers based on their needs. Some needs are met by a PC as is the case with Lauren. The $999 MacBook simply doesn’t provide her with the screen size she wants for the price point she’s at. There’s nothing wrong with that. When Lauren decides to buy a PC she makes trade offs and for that matter she seems OK with that. You have to wonder if she understands the tradeoffs she’s making. Was she aware of Apple’s leading customer satisfaction scores, the amazing iLife software, the excellent quality hardware, access to Genius Bars and a stellar Operating System. These were the things that brought me to Apple (see my 2005 blog entry). Is a more educated consumer likely to prefer Apple?

Consumers are very price conscious today and it’s understandable why Microsoft would want to address their value add in this area. Lauren looks very happy with her purchase. Welcome to Vista Lauren! I’m sure you’ll enjoy it as much as much as all of the other Vista users who wish they could be back on Windows XP. I couldn’t resist…

3.0 Features: Is the Best Yet To Come?

This Tuesday at Apple's media event we had a sampling of what's to come in the 3.0 software. Let's hit the highlights:

- Cut, Copy and Paste: About time. Apple claims they've been "working really hard" on this one. From the looks of the double clicking, grab points and choice bubbles it looks like Apple got it right. We'll have to see. Apple was very clever in their approach towards capturing blocks of text from sources like Safari although I can see formatting issues when pasting HTML in to a mail mixed with regular text. I like the shake to undo and redo.

- Landscape: Again, about time. It was available in Safari all this time can't see why Apple held this back.

- MMS: Yet another feature that should have been out since day 1. Interesting use for sending location and audio. Sorry pre 3G folks - not available for you...

- Voice memo: Great looking interface. A nice to have, but no biggie.

- Calendar: Ability to integrate with CalDAV and calendar subscriptions. OK I suppose for some, but I can think of more important features like a "week view".

- Stocks: Great upgrade, but would rather see Apple's time spent on other items and apps like this left to third parties.

- Search: Long overdue and Apple must feel relieved they finally have this out. This was one of the major reasons why I didn't like the iPhone. It's not that I search that much, but when I need to, I really want the ability. I like the ability to search across all core applications. Wonder if Apple will allow 3rd party applications to tie into Spotlight. I also took note of the server based search possible with Exchange 2007. That's significant because it signals Apple is possibly looking to make changes to its ActiveSync performance and capabilities.

- Notes sync: Another on the list of "what took so long". It's still inexcusable that a To Do program isn't available from Apple. Rise up people, come on....

- Wifi auto login: This is actually a big deal for those of us who like to connect in wifi hotspots. It's a real pain having to authenticate through Safari each time. If this can help ease the process that will be a big plus.

- A2DP: If you're one of the few who's looking to have wireless headphones you're finally in luck.

- Parental controls, youtube, etc: All nice add ons.

Apparently there are about 100 new features with 3.0 yet we've only seen and heard a very few dozen. What else is out there that we don't know about yet. There's chatter about tethering, encrypted iPhone backups, new Podcast controls, and more. We'll hear about more features over the next week as developers get a chance to go through the 3.0 software and report back.

The iPhone is far from perfect even with 3.0. Is still lacks an organized home screen, lack of ring and vibrate profiles (like a Blackberry), lack of offline mail for Exchange users, lack of customized shortcuts and the list goes on (my original issue list). No device on the market is perfect.

Next Generation iPhone Likely to Have Video Capture

All signs are pointing to new iPhone hardware in the next few months. The updates will likely include a new processor and video recording capability along with the long list of announced and unannounced 3.0 features. Ars Technica discovered references to the new devices within a system file included with the 3.0 beta released to developers on Tuesday. A "publish video" screen was also discovered by Engadget to further push the notion of a next generation phone.

It's never made sense that the iPhone has lacked video capture capability. It's completely counter to Apple's overall personal multimedia strategy. If a free phone from any cellular carrier can capture video then why not a state of the art device like the iPhone. The first and second generation iPhone's clearly have limitations that Apple hasn't been completely straight forward about.

New Breed of Applications On The Way

At the iPhone 3.0 Media Event today, Apple announced a new SDK. Not everyone is technical here so let’s get on the same page. SDK stands for Software Development Kit. It’s a set of development tools utilized by software developers to develop applications for a particular platform (i.e. the iPhone). During today’s media event, Apple announced a new SDK with over 1,000 APIs. What’s an API you ask? The Application Programming Interface exposes the nuts and bolts of application development to developers. OK, I am simplifying this a little bit. What matters here is that Apple is extending the capabilities of what iPhone developers can bring to the market.

Here’s a glimpse of some of the new features available to the development community:

Push Notification: Apple has long been criticized for not allowing applications to run in the background. When you hit the Home key to access another application you’ve essentially closed the application you were working in. This was all done in the spirit of addressing performance issues caused by applications running on Smartphones in the “background” (lingo for not the application you’re currently using). According to Apple, based on their test of a 3rd party IM client tested on multiple non Apple devices, stand by time for those devices dropped by 80%. Apple’s battery life with 3G is already bad enough. The last thing Apple wants is for you to have 20 applications running in the background as your phone battery quickly fades away. The downside to having these applications not running in the background is that you’re unable to receive alerts or messages from the application. If you use a chat application and someone IMs you, you wouldn’t know it until you used the application. Apple’s solution is to provide a notification service so application vendors could notify Apple of application alerts. Apple in return would notify your device. Apple acknowledged today they “were late on this one”. They expected to have this available by the end of 2008, but it didn’t happen. Based on developer feedback they had to “completely rearchitect the server infrastructure to make it really scalable”. The jury is out on if Apple is doing the right thing here. I believe Apple is genuinely interested in providing the best experience possible and restricting background applications is, arguably, a wise choice. There are applications that are not alert or message based that still won’t be able to run in the background. There should be an option for users to allow this.

Peer to peer device connectivity: Developers can write iPhone and Touch applications that can interact with other devices over Bluetooth using built in auto discovery features. Developers can focus on writing their application while Apple handles the discovery, connectivity and state management of other devices. Ideal for games, document sharing, etc…

Accessories: The iPhone and Touch will be able to communicate with devices external to itself. At the media event today, there were examples of how this might be used. In one case, an iPhones could control an external speaker via a phone based equalizer and a blood pressure device provided info to the iPhone via an application, Who knows…heart monitors could be next. Very cool.

Maps: Two areas of interest here. Applications can finally embed maps in to their applications. In the past, Maps had to load up separately. There was a real disconnect between the mapping and the application. Apple is also opening up the “core location” ability for turn by turn direction applications. This explains why we’ve not seen these applications to date through the App Store. Turn by turn vendors will use their own maps due to license restrictions with Google maps.

App Store Enhancements: While of little interest to most users, Apple will provide applications with more flexibility for intra application revenue streams. For example, you could have a game you purchase with five levels. If you want to purchase more you can buy them within the application instead of an additional application. Another example, perhaps you wanted an Ebook. Today, you would need to download a new application for each book. With the new App Purchase APIs, a single application would allow purchases from within the application. Everything would connect to the App Store to leverage Apple’s infrastructure for downloading, credit card processing, etc. Not sexy to the end user, but will improve certain experiences with applications.

The SDK will bring a next generation of applications that will impress. We’re on the verge of a new breed of applications we’ve yet to see.

Behind the Latest iPhone Statistics

During the iPhone 3.0 media event today, Apple offered its usual buffet of statistics for the public, media and financial analyst. Let’s analyze the significance or items of interest with some of those numbers.

Worldwide Availability: The iPhone is now available in 80 countries. Pretty impressive numbers considering the phone has been out for less than two years. Blackberry, in contrast of another “smartphone”, is available in 90 countries. The iPhone has great global exposure. A large global audience opens up opportunities for developers to bring their applications to all parts of the globe.

25,000 Applications in iTunes Store: At the time I wrote my iPhone 3G review there were only 500 applications in the App Store. The new number is jaw dropping for a less than a two year old platform. And the reason…

800,000 SDK Downloads: The iPhone SDK continues to fuel the environment for iPhone developers. Of course not all of these downloads represent developers releasing products, but the interest in the platform is amazing. Apple has done such a great putting the SDK together for developers it has created ideal conditions for developers to translate their great (and not so great) ideas to the iPhone.

96% of Apps Submitted are Approved: What are we to make of the 1000 applications not approved. Is Apple restricting creativity? Is Apple playing too much of a role in what’s “decent” and “appropriate”? Apple’s desire to create the “right experience” often limits choices.

62% of iPhone Developers Are New to Apple: Any Mac enthusiast has to love this. The iPhone SDK provides exposure to the Apple environment. If Windows developers, for example, take their Apple interest to the OS X space, just think about the application market that could lie ahead.

17 Million Total iPhones Sold: Gartner released their Worldwide Smartphone Sales statistics. At the end of 08 Gartner estimates that Apple owns 8% of the market share. Apple’s year over year market share increased 245%. Lots of upside with the iPhone.

Live Updates from the iPhone 3.0 Press Conference

If you're interested in keeping a live eye on today's Apple iPhone 3.0 announcements you can tune in to these sites starting at 1 PM E.S.T.

MacWorld

Cnet

Engadget

Ars Technica

Check back later this evening for my thoughts and analysis.

On the Copy and Paste Bandwagon?

The ability to copy and paste has become one of the most desired features of the phone. It's easy to see, after using the device, how implementing copy and past could be a challenge, but other touch screen phones have had copy and paste. No pass for Apple here. In the past, Apple has basically said there's no reason they haven't done it and would consider it. That's Apple talk for "we're working on it, but we're not admitting it". The rumor mills, on sites like MacRumors, are reporting copy and paste is finally destined for the iPhone and will be announced this Tuesday at Apple's iPhone 3.0 event. I often here from others how they wish the iPhone had copy and paste. I was one of those when I had the device myself. However, there are phone features that are sorely needed and surpass the copy and paste feature. Copy and paste is a convenience feature and who doesn't like those, but there are other things about the iPhone or its integration with the desktop that I would much rather see fixed first. There's no way to sync iCal or Outlook To Dos with the iPhone. That's an issue. The positive about Apple's attention on copy and paste is that Apple is listening to users. As much as I don't see copy and paste as important relative to other features - I know others do. The 3.0 release is bound to offer an abundance of features above copy and paste. 3.0 will hopefully bring the type of dramatic change the phone needs to build upon its strengths yet offer the feature set that's appropriate for a modern day/next generation phone. More of my thoughts tomorrow.

Sirius XM iPhone Player (Almost) Ready

Yesterday, Sirius XM Radio announced a player for the iPhone was in the works. Let's take a look at why this is important. Interest in streaming content continues to grow. After a while people tend to get tired of their music libraries. There's just something about live content that's streaming. It feels "fresh". Applications like Slacker, AOL Radio and Pandora have occupied the streaming space on the iPhone over the past year. These are all worthy options, however, the content is sometimes limited, generic and often rich with boring commercials (disagree?). Sirius XM, for those that don't know, offers a subscription service with dozens of commercial free music channels mixed in with premium content with limited commercials (CNBC, CNN, etc...). Most consumers are exposed to satellite radio through their cars. Many new cars come with the radio included. One of Sirius' challenges was getting the device in the hands or cars of the consumer. While more devices are available in new cards than ever before, and Sirius expects overall growth to continue on that fact alone, conversion rates from the free trial subscription to the paid subscription run in the range of 50%. Using the iPhone as a radio device reduces the barrier to access for Sirius. The iPhone offers a device that isn't stationary and locked in your car and limited my satellite line of sight connectivity. Have a 3G connection and you're ready to go with a iPhone player. XM offered a Blackberry player, but it offered limited channels, a terrible interface and was not priced correctly. For the Sirius iPhone application to be a success it must have a great interface and the price model must be appropriate. How many iPhone users want to pay another $10 on top of their existing phone and data plan? There's a market there, but limited. I've been surprised we've not seen a player for the iPhone to date, but the announcement from yesterday along with the timing of Apple's 3.0 roadmap has me thinking there's a connection. Either that or Sirius is so cash strapped in R&D they are sitting back as long as possible to figure out the right approach to take with future mobile devices. Regardless, this is an important application for the iPhone regardless if people subscribe to Sirius or not.

A Shuffle Forward and Back

This morning, Apple released the new, 3rd generation, iPod Shuffle. The new Shuffle is even smaller than before. Half the size of the previous generation - if you can believe that. I always like the concept of smaller and more compact, but there are often tradeoffs. The tradeoff with the first two generations of Shuffles was the lack of display screen. With past Shuffles, if you like a song you're listening to and want to know what its name, you were out of luck. For many like myself the display didn't really matter. The Shuffle has always been easy to carry around and when it drops it rarely is damaged. With the new Shuffle, Apple ushers in the era of micro players. For Apple to pull of this new form factor they removed the controls from the device and moved them to a Apple specific headphone. What I liked about the first two Shuffles was that I could walk down the street, sit on a bus, whatever, with my Shuffle in hand. When I wanted to change a song or adjust volume I could easily and discretely move my fingers while holding the device. With the new Shuffle I have to make a conspicuous and non natural gesture of moving my hand to the top of the headphone to adjust track and volume. Not a fan of this new method. The new Shuffle continues to lack any type of display. There is a large segment of those who like players small, but don't want to lose the ability to know what song they're listening to. And for those, the new Shuffle offers VoiceOver (space not included). The new robotic voice will announce the song or playlist you're listening to. Nothing sexy, but I suppose nice to have if you want to know the song. The device has 4GB of memory to hold 1000 songs for $79. The 2nd generation devices are still available while they last.

Product Announcements from Behind the Curtain

Apple announced a number of changes today to the Mac Mini, iMac, Power Mac, AirPort Extreme Base Station and Time Capsule. Numerous updates to hardware specs and price points relative to value to get excited about. Details are available on sites such as MacRumors and Apple Insider so I won't get in to that. This was a large product update without an Apple media event. The Power Mac design changes alone would normally been the focus of, at least, a small media event on Apple's campus. Let's focus on what happened here. Jobs is not well. Many Apple investors are hanging on by a string because they think Jobs is Apple and Apple is Jobs. Holding a media event provides the media with yet another opportunity for the media to ask: Where's Steve? Of course there are other reasons why we experienced web based announcements today. Apple could consider this upgrade as extremely minor relative to other upcoming announcements. Think iPhone, future tablet and netbook (a word my Mac dictionary doesn't even know). Why distract the media during a media event that's pretty hum drum and evolutionary vs revolutionary. Maybe the Apple mantra has become "Cool and sexy = Media event". Today's product announcements were not sexy enough to bring up the curtain on a stage, but they are important steps forward in keeping current.