Long rumored, Microsoft’s alleged “iPod killer” will reach store shelves in time for the holiday season, according to entertainment-industry executives cited by the New York Times.
Microsoft’s portable music and video player apparently will look similar to some devices already based on its software from Samsung, Sony, and Creative Technology, but it will feature wireless connectivity — let’s hope it’s WiFi and not the proprietary, extravagantly priced wireless bandwidth purveyed by wireless operators — and a sharper video screen. Microsoft also reportedly is negotiating with major record companies and television networks on terms that would allow it to sell music and video content online through a service similar to Apple’s iTunes Music Store.
A few years ago, it would have been statistical folly to bet against Microsoft’s ultimate success in a new market. Now, it’s an even-money wagering proposition; Microsoft is no longer a “sure thing” in any market. Distracted and defocused by its own internal politics and a changing of the executive guard along mahogany row, Microsoft seems to be navigating a desultory course in a strategic miasma. It talks a big game about competing with Google in search and online application services. It also seems to want to be a major player in unified communications and VoIP services, for enterprises and for consumers. Let’s not forget about its console-gaming franchise with the XBox, and its existing operating-system, its Office personal-productivity application suite, and its forays into business applications for SMEs. It’s also working on grid computing, and in a host of other areas too numerous to mention.
Does it all hold together, cohesively if not coherently? I’m not sure. The grand strategy is not clear to me.
As for the “iPod killer,” I think Microsoft is picking a fight it cannot win. I can see why they’re doing it — its braintrust thought hardware licensees of the mobile variant of Windows could more than take the battle to Apple, but that never happened — that they fervently believe a successful Windows-based device is integral to driving traffic to an online music and video store on a resuscitated MSN portal. What’s more, Microsoft doubtless believes that Apple’s increasingly strained business relations with record companies and television networks represents a weakness than can be exploited.
What Microsoft is forgetting, however, is that the iPod has been a huge success with consumers. Alternatives to the iPod are on the market, and alternatives to iTunes also are available, and people overwhelmingly have voted with their wallets in Apple’s favor. That isn’t to say that Microsoft won’t capture a minority share of the market; such an outcome is probable. However, since when has Microsoft been in the business of finishing as an also-ran in any market, functioning merely as a competitive foil and a negotiating prop between a market leader and its content suppliers? That’s a comedown for the great Microsoft, like like a formerly fearsome heavyweight boxer struggling through 10 rounds against a club fighter.
Maybe Microsoft should have reached a different conclusion when its hardware partners failed to make a serious dent in Apple’s iPod franchise. Perhaps Microsoft should have concluded that the market had been defined and won by Apple, rather than that vertical integration of Microsoft hardware and software would make all the difference to the market outcome.
When Microsoft hatched the XBox, it knew that online console gaming was still up for grabs and that there was no other feasible way to get into the market other than building the boxes itself. It made sense for Microsoft to follow the course it devised. This time, though, Microsoft appears to have drawn the wrong conclusions. At the end of the “iPod killer” road, I suspect Microsoft will be left with minority market share and a lot of broken relationships with former hardware partners. Will it all have been worth it?