Why Apple Needs to Innovate

Long piece here on ‘Why iTunes Sucks’.  I don’t agree with all of it, but there are some interesting angles, such as the fact that iTunes is becoming a store front for iTunes Music Store.  I find this particularly interesting because it could well be an indicator that the ‘store guys’ at Apple are pulling too far from their leash.  Why?  Because the Store has always played a very distant second to the devices.  Apple is about selling technology, not media.  It uses media as a means of creating and demonstrating usage scenarios for their devices.  Not so long ago, Apple’s non-existent media strategy was summed up perfectly by their marketing message: ‘Rip, Mix, Burn’.  They didn’t care about selling content, simply that people would use content on their technology, regardless of IP considerations. 

 

Though the iTunes Music Store has become a fully fledged media (and indeed App) store, its remit firmly remains to help sell iPods and iPhones, and too keep people using them.  But if the software which is the lynchpin of the usage is becoming compromised in order to try to drive sales of content, the equation has become incorrectly balanced for Apple’s strategic priorities.  Apple would much rather that device owners were having a great experience and sell a little less content than the inverse.

 

So why has iTunes become bloated, so heavily focused on promoting the store and in some respects archaic? I’d argue a lack of competitive pressure has been key.  My colleague James McQuivey has developed a concept called the Convenience Quotient that Apple would be well advised to understand at the moment.  His thesis centres on the principle that removing barriers and increasing benefits drives convenience and thus adoption.  Apple nailed the usability part of the ‘Barrier-Benefits=Convenience’ formula with the iPod / iTunes combination.  It was gracefully easy to use.  Dynamic consumer adoption followed despite relatively premium price points.  But now, lacking strong competitive pressure Apple seem to be taking their foot off the pedal.  The iPod range lacks the simplicity it once had, but more importantly the usability is becoming less elegant also, thus reducing the ‘Convenience Quotient’. 

 

Also, the iTunes Music Store hasn’t had any significant innovation in years.  It’s essentially stuck to yesterday’s digital music model whilst the digital music market has evolved beyond recognition around it.  The lack of competitive threat (Apple has the vast majority the European digital music market) has enabled Apple to let iTunes Music Store stagnate whilst it’s technology has evolved. 

 

Now don’t get me wrong, Apple’s not about to get knocked off its throne, but it could really do with some increased competitive pressure to drive its innovation back up to its own incredibly high standards.  The near term future is safe, but the longer term needs more investment.

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