Something interesting is happening in the tech market. Companies that generally might compete with Apple are choosing instead to partner with them. Both Sonos and Pioneer are becoming Apple partners to leverage the iPad, iPhone, and iPod products, while companies like Sony and Samsung are competing with the company. Sony is putting a lot of effort into its new S1 and S1 tablets to run against the iPad, while Panasonic and Sonos use the tablets and Airport express to improve their own offerings. I’ve always thought, given Steve Jobs used Sony as a template when he rebuilt Apple, that Sony of all the vendors should have the best chance to win in a head-to-head fight. But it never has.
Let’s contrast the different strategies.
Competing with Apple
Taking Apple on head-to-head is daunting, as no one vendor has successfully done it outside of Microsoft (in certain product offerings) and even Microsoft has been unable to catch Apple from behind in the last two decades. Apple is currently unbeatable in MP3 players, and only faces real competition in the smartphone market because it is limited in terms of carriers and weaker overseas than in the US. Apple has over a year lead in the tablet space and total dominance right now.
Watching vendor after vender try to bring out a competing tablet over the last year has been a painful exercise as each has fallen woefully short, much like the iPod vendors did nearly a decade earlier.
Sony recently announced its new S1 and S2 tablets, which are a case in point. Attractive, but their big differentiating features are the ability to run PlayStation 1 games (which are based on technology now two decades old) and include the ability to act as a remote control (at least for the S1) for Sony TVs, or for the S2 to be foldable.
Sony will undoubtedly spend a ton of money like Motorola did with the Xoom, but it is unlikely the company will sell many in what appears to be a repeat of the failed iPod strategy a decade earlier. It almost feels like folks are going through the motions, wanting the excuse when they fail that they just didn’t care that much about the fight.
Partnering with Apple
This is what Sonos and Panasonic are doing. Both are using the iPod line as remote controls, and are now integrating with Apple’s AirPort Express access point and related services to stream iTunes music to their devices. This is a “if you can’t beat them, join them” strategy, but there are clearly risks. Apple will block any functions they think are competitive and, at some point, they might look at what Sonos is doing in particular and decide to move in and take the business. I think it’s doubtful they will want to challenge Pioneer though, and build receivers.
On the other hand, if Apple doesn’t see Sonos as a threat or an attractive runaway success, which it doesn’t, Jobs and company are likely to leave Sonos alone and cooperate reasonably well with them. Neither Sony nor Sonos has to spend dear R&D dollars to develop iPods, iPhones, or iPads. Every owner of one of those devices already has a controller, and is at least part way to becoming a Pioneer or Sonos buyer. That’s part of why I chose the new Pioneer VSX 1021-k receiver for my new 3D setup; I already had two iPads I could use as controllers for it, and didn’t need to buy another expensive one. The app is free, making this an attractive deal. With the Sony approach, I’d have to buy a Sony receiver and an S1 tablet, paying twice as much for the same experience. That’s an easy choice.
Sony or Sonos, who wins?
It really comes down to whether you think you can win. Sonos and Pioneer are far too small to take Apple on, and it just makes much more sense to partner with the company. Sony believes it is big enough, and in fact I agree if Sony employees can put their mind to it and focus as a company, they would have a shot at kicking Apple’s butt. Only right now, they just aren’t bringing their “A” game.
I haven’t seen Sony focused enough to take on Apple in decades. If the S1 played PlayStation 3 games, or the S2 played current PSP games, I could see a fight. But Sony isn’t even coming to market with its best stuff in order to protect the other franchises. Maybe Sony’s size is working against it, and management simply doesn’t have the balls to take Apple on. “Could” and “will” are two very different words. Sonos and Pioneer know they can’t take Apple on, so are forced to make the right choice.
In the end, the lesson for any company looking to take on a goliath vendor that dominates its market is clear, whether that company is Microsoft, IBM, EMC, Oracle, Apple, Cisco, or Intel. Bring your “A” game. If you aren’t willing to play at that level, partner with them or go home.
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