Deconstructing the Video iPod

Based on the expectations set for the video iPod, today?s announcement was disappointing given it didn?t really provide the same kind of user experience with video as the original iPod did with audio.  However, I?m not yet sold that video is a good market yet and the Portable Media Center products have hardly been huge hits.  So, upon further review, this new iPod is a better match to market needs than our overset expectations would have had us believe. 

That?s a mouthful so let?s deconstruct what works and what doesn?t in today?s portable media market. 

Single Use Devices

Starting with the Sony Walkman and moving to the original Palm Pilot the market has always liked devices that do the one or two things well people want them to do.  The Walkman played CDs, the Palm did contacts and both did them very well and were successes in their time. 

Portable DVD players, which did video as well as music, have never been as popular as the Walkman was, handheld TVs did TV badly, and while the Personal Media Center did video and audio relatively well it didn?t sell particularly well.  This suggests that customers don?t want things that do the job poorly and may not want a hand held video player.  Strangely enough Steve Jobs has publicly expressed his doubts about this. 

This means if you are going to add video you should make sure the device does what people want it to do well as a primary function first, and make video a secondary feature.  We saw this with the Sony PSP which plays games well and has marginal video and music capabilities.  This device is currently manufacturing constrained which suggests the video and audio capability limitations haven?t hurt it much.  

The New iPod

The New iPod comes in 30 GB and 60 GB capacities, has a color display, a much slimmer design and adequate battery life.  Shortcomings are it still lacks a battery that is replaceable (unless you ship it to Apple), and it still does not have radio features that other portable players have.  Overall the advantages exceed the disadvantages (people do buy these things on looks and the battery and radio issues haven?t hurt this line yet) making this a solid offering that plays music very well.

This may be all this class of device has to do and focusing on music first, until we find a sustaining use for video, would appear to be the best strategy.   Given the popularity of the black Nano I expect a black version of this to be the most popular and in the shortest supply.  

On the video side, compared to what was done with the original iPod and music, the ability to download and pay $2 for programs you can watch on TV for free seems kind of painful, particularly when you compare that to the Slingbox, Tivo ToGo, or ORB experience given all of those provide similar capability on a variety of devices for free.  But then, as mentioned above, people are hardly going crazy for video anyway so I really don?t see this as a huge shortcoming yet and an interesting way to test the waters. 

As long as you simply want a good, high capacity, music device and are happy with iTunes this will continue to be the best in its class, you do have to ask, however, if this class of device makes sense any more. 

Competition

The strongest competition for this new product will come in two areas.  For those that want a new product the Nano, announced earlier, is arguably more stunning, a better match to how the device will actually be used, more robust, and a better overall value.  

The other product is the existing installed base of hard drive based iPods which even with aging batteries and hard drives are still meeting user needs.   These are tough times when people are being asked to donate large sums to help disaster victims and buying a new iPod if your old one is working fine may simply not make sense to many this holiday season.

At some distance the rest of the competition really goes to other potentially very popular devices that will sell against it in the 4th quarter. 

The Sony PSP remains a very popular portable device for gaming and it is unlikely many children will receive both an iPod and a PSP this year.   Particularly if they already have an iPod, which is likely, the more compelling purchase may be a PSP. 

The Xbox 360, while it may seem to be a completely different product, falls within the same high priced category as the new iPod and will be wrapped with an extensive marketing program.  I had a chance to play on one last week and most stores have already sold out their 4th quarter allotments even before the initial ship date.  As with the PSP, for kids and young adults, few will get both and this could pull from the iPod revenue pool.  

Largely because of price and availability, I expect the Nano to outsell everything I have listed here this year though next year could be very interesting.  I?m personally not yet convinced that hand held video is the great nirvana people seem to think but if it is, it will probably first break on cell phones which, because they are networked, can provide the best real time experiences right now (I?d put laptops second because of their larger screen and WiFi).  

Apple continues to show that when it comes to portable MP3 devices, they know this market best and it continues to amaze me that few seem to be able to come anywhere close to Apple?s level of excellence in this segment.

The views expressed here are solely those of the author and do not reflect the beliefs of Digital Trends.