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Media (Apple) Media Businesses Music

Is iPod the Razor or the Blade? 360

Posted by michael from the razor-burn dept.
Kelly McNeill writes "Robert Cringely has another update to his 'I, Cringely' series. In this piece, Cringely analyzes the business model of the iPod and how it compares it to the age old, marketing 101 'give away the razor and make money on the blades' business model. In his editorial, he demonstrates that Apple one-upped Gillette by making money on both blades and razors. The article is structured in a back and forth dialog with one of his readers who provides a very interesting analysis of the direction that Apple will be going with its rumored movie download store and how it relates to the Mac mini. On the same note, osViews has an editorial about Apple's direction in the movie download business as well, which suggests that there is evidence to suggest that Apple will use satellite networks for its Movie download store."
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Is iPod the Razor or the Blade? More

Is iPod the Razor or the Blade?

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  • Neither the Razor nor the Beard (Score:4, Funny)

    by serutan ( 259622 ) <snoopdoug AT geekazon DOT com> on Friday January 28, 2005 @04:26PM (#11508206) Homepage
    Personally I think IPod is the stubble.

    • Re:Neither the Razor nor the Beard (Score:4, Funny)

      by tedwilliamsis ( 671858 ) on Friday January 28, 2005 @04:48PM (#11508496)
      I believe that's pronounced shuffle

    • Analogy not applicable (Score:4, Insightful)

      by gumnam ( 815935 ) on Friday January 28, 2005 @05:09PM (#11508772) Homepage
      The razor-blade analogy is not really applicable to iPod-iTunes.

      Blades are *essential* to use the razor. And blades get consumed and have to replaced. And Razor by itself has no purpose. Its the blade which provides the value/service

      iTunes is not essential to use the iPod. iPod by itself provides the value/service to the owner. That explains the high margins on iPod.

      iTunes is not consumable in the sense that the songs you download dont become unusable (Though their entertainment value or may go down)

      In my view razor-blade analogy does not apply to iPod-iTunes at all.

      • Re:Analogy not applicable (Score:4, Funny)

        by BlueTooth ( 102363 ) on Friday January 28, 2005 @06:53PM (#11509702) Homepage
        No no...the music is the razor handle...its relatively inexpensive (or even free) and lasts forever...the iPod is the blade: its gets irritating (battery life) if you don't replace it every 18 months and costs about 50% more than you think it should.

      • Re:Analogy not applicable (Score:4, Insightful)

        by jerkychew ( 80913 ) on Friday January 28, 2005 @07:44PM (#11510090) Homepage
        To extend your statement a bit, another reason that the Gillette blade is essential to the handle is that it is the only blade that will work with that razor.

        Other services work with the iPod. Sure, they may not be as easy to configure for your iPod as iTunes is, but they're not impossible to use. It's a lot easier to use an iPod with Napster than it is to duct tape a Schick blade to your Gillette Mach 3 Turbo.

        However, the analogy was close: If the iPod is the razor, then the interface is the blade. You're not necessarily paying for an ipod per se, you're paying for the experience of the user interface. Same with iTunes, and the same with the Mac. This was always Apple's cornerstone: Don't sell the hardware, sell the experience. But make the hardware so tied to the software that users were forced to pay inflated premiums just to get to The Experience.

        What's funny is, that has been Apple's strategy for the past 20 years (at least, the years under Jobs). But it's never really worked out... Other manufacturers came along and produced a platform that, while it wasn't as elegant as the Mac Experience, it still got the job done for far cheaper.

        Here Apple goes once again, with the same strategy. But this time they've learned what to do: Corner the market on the most important part of the business - The content, and produce hardware that has a unique, slick experience, and is still somewhat competitive with other manufacturers' prices.

        In essence, Apple is doing what Microsoft did 15 years ago with the PC platform, while still retaining the Apple Experience that it so holds dear. Apple's razor has always been its experience; it's just taken them 20 years to bring it to market effectively.

        • Re:Analogy not applicable (Score:5, Insightful)

          by Ohreally_factor ( 593551 ) on Friday January 28, 2005 @08:52PM (#11510534) Journal
          Interesting, if confusing, idea.

          Perhaps what confuses me is the mixing of term. You say that Apple is selling the interface or experience. OK, I can accept that equation. interface = experience. Not a stretch.

          Then you say that Apple has a corner of the market in content. If you mean that they have a corner in the market on songs, clearly this is incorrect for a variety of reasons.

          So you must mean something else by the word content. Are you making a third equation, or redefinition, where content = interface = experience? This is my best guess as to what you mean.

          If this is the case, then I think you are wrong on this specific point as well, as all the other MP3 players and all the other online music vendors must also have interfaces for their products to work.

          Perhaps our difficulty in understanding this is that interface, or more generally experience, is not fully commoditized. There is room for qualitative differences, and the market itself shows that there is a great deal of value in these qualitative differences. People will pay a premium for the qualitative differences in an Apple product, whereas they probably wouldn't if Apple was selling a true commodity product like coal. Would you pay more for Apple branded coal if there was no true difference between it and other brands of coal? (This question assumes you're a normal person, and not the stereotype of an Apple fanboi.)

          If nothing else, I think this points out that computers have not yet reached the stage of being a true commodity, and possibly never will. I won't argue that certain component have become a commodity, but so long as it's people using computers, there will be a segment of the market (people who use computers, oddly enough) that will choose their computers based on qualitative differences. If this were not so, we wouldn't have a variety of linux distros, nor a variety of interface choices on linux (KDE, Gnome, X11).

          One of the things "holding linux back" from becoming a commodity OS has been this richness of qualitative difference, whatever one might argue about marginal costs.

  • It's neither. (Score:4, Funny)

    by bigtallmofo ( 695287 ) on Friday January 28, 2005 @04:27PM (#11508208)
    Take it from someone who's attempted to shave with their IPod. It is neither razor or blade.
  • It's really practical, even as a guy, to have a bag strapped over the shoulder- Unfortunately, guys never used to do that, because it's what used to be called a Man Purse which was considered pretty weird and goofy.

    Then, out of nowhere, people started calling them messenger bags to link them with the cool, stylish image of a messenger courier- For no good reason, this now has enabled any guy to carry a shoulder bag while remaining "cool".

    In the same way, it used to be a bit dorky to run around with a mp3-playing computer doodad in public even though it's fun and more practical than a CD player.

    Apple leveraged their "coolness" to rebrand the uber-geeky mp3-computer into a fashion item, so that people can use a practical tool without feeling weird and goofy.
    • On Campus, It used to be that you were cool if you had an iPod, but over the course of the last year, it has become that you aren't cool if you don't have an iPod.

      It more than a fashion thingsince I constantly hear people talk about how the ipod has changed their life. You can't underestimate the apeal of what it does, not just what it is.

      Personaly, I got rid of my white earbuds, since all i cared about was the music and not the fashion. and BTW, I proudly carry a manpurse.

      • You know that saying "you were cool if you had an iPod" is the same statement as "you aren't cool if you don't have an iPod." So what your saying is that nothing has changed.
        • Although both statements have the same technical meaning, they have different implied meanings (to me, anyway). The first says that people who had iPods were the exception and were cool for it. The second statement says that people who don't have iPods are now exceptions, and are uncool for it. (Even if the grandparent poster meant to say that "Now, you aren't cool if you have an iPod," which is how I initially read it.)

        • Re:A Better Analogy: iPod=Messenger Bag (Score:4, Informative)

          by Anonymous Coward on Friday January 28, 2005 @04:45PM (#11508443)
          Wrong. The converse of a statement is not necessarily true, whereas the contrapositive is always true. In this case, "you are cool if you have an iPod" is the same as "you don't have an iPod if you're not cool", but not necessarily the same as "you aren't cool if you don't have an iPod".
        • You know that saying "you were cool if you had an iPod" is the same statement as "you aren't cool if you don't have an iPod." So what your saying is that nothing has changed.

          If your going too take you're time too knock his logic, you might want to make sure that you're "yores" and "you'res" are correct. Otherwise, your to much of a hypocrite too post that.
        • You are assuming there are only two states, cool and not cool. Don't be so binary. :-)
        • I believe that's called "Denying the Antecedent"

          If P -> Q
          it does not follow that ~P = ~Q.

          Ex: If I am in Manhattan (P) then I am in New York(Q)
          If I am not in Manhattan (~P) then I am not in New york (~Q) is FALSE. I could be in Brooklyn.

          Therefore, where before having an iPod made you cool, now *not* having an iPod may not be the reason for your Uncoolness. You may have B.O., which can also make you Uncool.
        • I thought the same thing until I pondered it for a minute. What he's saying is that the baseline has shifted. At first everybody on campus was a happy, freewheeling cat and all was good... but if you had an iPod then you had that early-adopter, i-sussed-out-the-cool-new-gadget first that makes all the freshmen girls swoon. Over time, however, things changed. Now you *have* to own an iPod or you're an outcast, a loser, a guy who won't get the chicks without a crate of whiskey and a roofie the size of a urina

    • Re:A Better Analogy: iPod=Messenger Bag (Score:5, Interesting)

      by ArmenTanzarian ( 210418 ) on Friday January 28, 2005 @04:43PM (#11508424) Homepage Journal
      I also heard an analysis of messenger bags (and SUV's) for professionals, saying that people get them when they have the realization that the delivery guy is the only one in their office who does any real work.

      I definitely agree with the added "coolness" factor of the iPod, but I think mp3 players were generally acceptable beforehand (it sucks to walk/jog with a cd player). It was really a blitz on both coolness and technical merit. The coolness pushed the iPod from gadget to accessory at the same time the technical specs pushed it for us geeks. The end result is that I carry around the same piece of hardware as a 19 year old sorority girl.

      It's hard to think of anything else that's that ubiquitous. Perhaps computers and cell phones, but there's no "it" cell phone or computer that balances the two perspectives.

    • Re:A Better Analogy: iPod=Messenger Bag (Score:5, Insightful)

      by hondo77 ( 324058 ) on Friday January 28, 2005 @05:05PM (#11508711) Homepage

      For no good reason, this now has enabled any guy to carry a shoulder bag while remaining "cool".

      No, it hasn't. Somebody's been pulling your leg. Now take that thing off before someone notices.

  • Neither? (Score:5, Funny)

    by christopherfinke ( 608750 ) <chris@efinke.com> on Friday January 28, 2005 @04:29PM (#11508232) Homepage Journal
    Could it be that the iPod is neither the razor nor the blade, and that the razor/blade business model doesn't apply?

    • Re:Neither? (Score:5, Insightful)

      by EvilTwinSkippy ( 112490 ) <yoda@NosPAM.etoyoc.com> on Friday January 28, 2005 @04:34PM (#11508303) Homepage Journal
      Amen.

      A better analogy would be a CD player and CD's to feed them. Or a casette deck and tapes to feed them. And note that the "cheaper" element isn't a comodity, it is an intellectual product.

      People really have got to stop thinking there is only one operating system, one economic system, one religion, and one business model.

      • Re:Neither? (Score:2, Interesting)

        by white meat ( 582005 )
        That's not a better analogy. Apple's making money off both the player (iPod) and the replaceable (songs). When's the last time Pioneer or Clarion or Sony (well, maybe Sony) took a cut of the CD's after selling the CD player?

  • Well, Gillette sold out for $56B to P&G today (Score:3, Interesting)

    by Anonymous Coward on Friday January 28, 2005 @04:29PM (#11508247)
    So if Apple are one upping Gillette, it means ... err ... wait, do I care? It is a bloody computer, if sites like Slashdot covered every new HP, Dell, Fujitsu, Asus, Shuttle PC we'd be snowed under.

    That's why Apple succeeds, they're like something completely different, they're not a PC maker, they're a maker of goods that work.

    Well, except the old PowerMac keyboards in the 90s, dayum, you had to have fingers like superman to use them. Yuk.

    Apple is a company like any other company. They've got to make a profit (and they do!). They've obviously decided that Mac OS X and supporting applications is good enough to target computers are the mass market.

    Hell, you can buy a MicroATX PegasosII system from Freescale for $650, including RAM, case, processor, board, etc. PowerPC costs seem to have gone down a lot in the past year.
  • Sell the iPods at a loss and make up for it with iTunes. Sell iTunes at a loss and make up for it with iPods. Then make up for both with volume!

  • How about neither? (Score:5, Interesting)

    by Suburbanpride ( 755823 ) on Friday January 28, 2005 @04:31PM (#11508259)
    Itunes does not figure into the equation for me at all. I love my iPod, But I'm not a big fan of iTunes. I still use winamp to play all the music on my computer. and when I buy music, I buy the actual album, supporting my local independant record store.

    Everyone talks about the iTunes/iPod bundling as being esential, but I'm sure there's lots of people like me who love the iPod, but could care less about iTunes

    • Then you have wierdos like me who live iTunes but does not own an iPod. I use a Sony Clie to listen to music on the go. I purchase music on iTunes because when I'm shopping I generally have a tune stuck in my head, not an album.
    • I wasn't enamored of iTunes at first. I wanted an iPod and was willing to put up with iTunes to get it going. I *did* buy the huge U2 SE + song bundle, but normally, I'm not fond of digital-only music, in part because of DRM and another that it doesn't feel like I really own a copy of the music, just an odd lease.

      I went with the U2 song bundle because tracking down all the original (and possibly rare) CD singles or LPs for every song variant was just going to be too much work, plus it's nice to have the
  • Regarding the iPod Mini and the Mac Mini, it's clear that Apple is leading the charge in the latest trend... Mini is the new X! [blogspot.com]
    • Regarding the iPod Mini and the Mac Mini, it's clear that Apple is leading the charge in the latest trend... Mini is the new X!
      "Mini" is not the new "X" any more than "i" is the new "Power." They serve different purposes. Apple uses different prefixes and suffixes to signify different product types.

      Consumer: iMac, iBook, iPod
      Professional: PowerMac, PowerBook
      Server: Xserve, Xgrid, Xsan
      Small: iPod mini, Mac mini

  • Get it coming and going (Score:5, Insightful)

    by EvilTwinSkippy ( 112490 ) <yoda@NosPAM.etoyoc.com> on Friday January 28, 2005 @04:31PM (#11508269) Homepage Journal
    Why only make money on the razors or the blades when you can charge full price for both?
  • I'm considering getting an iPod, but the only iTMS songs I'd get would be "free Mt Dew cap" songs. I do not plan on using iTMS. I already checked their meagre listings and could not find most of the music I was looking for.
  • This is one of my biggest complaints with MMORPG games such as World of Warcraft. They charge the usual $55 for the game but then add on a monthly fee. I am surprised (and dismayed) that this business model has apparently been accepted so readily by the fans. It makes my personal boycotting efforts much less effective :)
    • Yeah how dare they charge you for providing the enormous bandwidth and network infastructure it takes to let you play your MMORPG!

      Complaining about World of Warcraft proves that you are a fool who has no clue. If Blizzard(the maker of WoW in case you didnt know, with your ignorance I could hardly expect you to) could afford to not charge they would, notice how they haven't been charging to use Battle.net which allows you to play all their other games multi over the net. They provide ranking , chat and tour

    • If you look at how much the companies spend developing and maintaining games like WoW and Everquest2, you'd understand why they charge $50 for the game and then have a monthly charge. It's in the several 10s of millions category.
    • Yeah! And I just paid five hundred dollars for this new TV. How *DARE* the cable companies charge me to watch their channels?

      I mean, I just paid *five Hundred dollars* !

  • Basically... (Score:3, Insightful)

    by Richard_at_work ( 517087 ) on Friday January 28, 2005 @04:35PM (#11508311)
    So basically, Apple has two products (iTunesMS and iPod) and is making money on both of them? Are we supposed to be shocked and appalled or something?

  • Right. (Score:4, Insightful)

    by 0x20 ( 546659 ) on Friday January 28, 2005 @04:35PM (#11508320) Homepage
    Because every time Apple does something, it's always the first time in history that it's ever been done. Or if it's not the first time, somehow they did it better.

    • Re:Right. (Score:5, Interesting)

      by clontzman ( 325677 ) on Friday January 28, 2005 @04:43PM (#11508426) Homepage
      Yeah, it's really bizarre. There are non-Apple-based movie stores [movielink.com] that work just great and plenty of non-iPod portable players to watch them on (from Archos, Creative, etc.), but it's not interesting news until Apple is rumored to be doing it. Gimme a break.
      • The exceitment over an Apple Movie store comes not from them being the first to do so, it's that they have a track record of opening media stores that people actually use.

        How many sales do you think MovieLink gets per month? How many do you think an Apple version of the store might get?

        Now the technical reason behind the potential for an Apple store succeding comes not from any hardware, but from Apple's ability to talk media companies down off the ledge of DRM. Somehow, they talked big companies into r

  • hmm, let's think (Score:2, Interesting)

    by blacklite001 ( 453622 )
    It's like the razor-and-blade thing, except the blades are useful on with any razor, and none of the razors actually need blades, and neither of them are being sold at a loss, and the replacement cycle of the blades is almost the same as the replacement cycle of the razors, and .. they aren't razors or blades.

    Okay, thanks!

  • Yeah, well, look what happened to Gillette (Score:3, Interesting)

    by cellocgw ( 617879 ) <cellocgw@gmail . c om> on Friday January 28, 2005 @04:36PM (#11508328) Journal
    In case you missed the WSJ today, P&G is giving them 58 billion in stock and promising to lay off 6000 after the merger.

  • It's neither the razor or the blade (Score:5, Interesting)

    by digitalgimpus ( 468277 ) on Friday January 28, 2005 @04:38PM (#11508349) Homepage
    Apple's strategy is very simple:

    All inclusive high end computing.

    Unlike most PC manufacturers, Apple did pretty much everything. Computer, Keyboard, Mouse, Printer, PDA, etc. etc.

    Apple's advantage is their stuff works very well together (those legendary plug-and-play sinareo's). Not to mention it's easy to use, well designed, and very good looking.

    Apple's plan with the iPod is just that: A simple to integrate, well supported music player on the Mac. Since most other mp3 players before the iPod didn't support the Mac.

    Apple expanded to the PC industry simply because of the success and market.

    Why sell music? Simply because it had the platform and opportunity to again, provide a way to easily and gracefully get good quality music onto your Apple product (see the simplicity theme?).

    Apple had Quicktime, and you can bet DRM was in the works well before iTunes. DRM was the talk of the day around that time. Apple knew it needed a music player to rival winamp, and windows media player. Hence iTunes was born.

    Digital photography became big. Unlike past trends, they used USB, and had a FAT32 filesystem, so the Mac was unoffically support on just about all. So what did they do? Created iPhoto, just to make life easy.

    Apple's business plan is simple: be the high end quality product. All inclusive, all included.

  • Totally inappropriate analogy (Score:5, Insightful)

    by SuperKendall ( 25149 ) * on Friday January 28, 2005 @04:41PM (#11508399)
    The thing is, the whole razor/blade analogy just doesn't fit at all no matter how you look at it.

    Fundamentially, what you have is a set of products. Each makes some money (varying levels of margins), each helps to sell the others. This includes the whole realm of Mac products, as iPods help sell computers help sell computers help sell iPods. And the whole set of items in turns helps sell branches of accessories.

    So really to say that one product helps sell the other is seeing only half the picture, it's ignoring that each product is built to support an interconnect with as many other products as possible. That's the recipie for Apple's sucess, just try to make products that fit into easy use with as many other Apple products as possible. Thus the combination flashdrive/music player nature of the Shuffle. And it even makes the iPod photo make more sense (from the Apple point of view) since it integrates with various parts of the iLife package that the older iPods did not. I was actually rather surprised the iPod photo did not also display slideshows from Keynote which would have made a lot of sense.

    I'm not really sure what kind of analogy you can draw from this as I can think of few other examples with such a wide variety of products that do such a good job of supporting each other. Where any one product (even just the ITMS) is such an avenue to being sucked into the world of other supporting products. Perhaps other people can think of good examples from the past.

    All I can say at the moment is that Apple is most like itself!
    • "Fundamentally, what you have is a set of products. Each makes some money (varying levels of margins), each helps to sell the others. This includes the whole realm of Mac products, as iPods help sell computers help sell computers help sell iPods. And the whole set of items in turns helps sell branches of accessories."

      Like Barbie ... between the dolls, the outfits, the houses, cars, and pets, Mattel has a gold mine!

  • "Microsoft's investments into cable over the past few years will keep the cable companies from distributing DV content in an open standard (MPEG4) but restrict the cable companies to Microsoft's Windows Media format."

    I posted a couple of months ago, in a story about MS DRM getting bundled into DVD players, how MS would exert control over movie watching as it moves from a SW monopoly to a media giant. Now it's becoming clear how MS is tightening the media noose in network distribution, the real future of al

  • Every Cringely Article Gets Posted? (Score:4, Interesting)

    by Time Doctor ( 79352 ) <zjs@zacharyjackslater.com> on Friday January 28, 2005 @04:42PM (#11508409) Homepage Journal
    Why is it that every Cringely article gets posted to the front page of slashdot? Perhaps someone should submit a story that suggests people who like his writing should turn on the appropriate slashbox.
  • How long before we see OSX on pocket PC type computers? A newton on steroids? For me that would be cool. I would love to have a multimedia computer that would fit in the palm of your hand and that you could hook USB and Firewire devices to. Pocket guitar and video editing studio ;) I love Windows and Linux, but OSX seems to be geared to Multimedia, so why has it not happened yet?

  • Difference between Apple and Gillette (Score:5, Insightful)

    by G4from128k ( 686170 ) on Friday January 28, 2005 @04:42PM (#11508412)
    There is no surprise why Apple does not need to use Gillette's strategy. The difference has to do with intrinsic and perceived value. First, whereas a Gillette razor handle is useless without a Gillette razor blade, an iPod is immediately useful with ripped CDs, MP3s, etc. iPod preceded iTunes download service and people where willing to buy iPods without the download service. iPod and iTune do complement each other, but not in the same obligatory way of razor handles and razor blades. Second, Gillette had a problem of lowering the hurdle of adoption -- people refused to buy the razor handle at full price not knowing if the new shaving system would work for them. In contrast, Apple's reputation for "stuff that just works" meant that they had no such hurdle. Apple fanatics would buy iPods sight unseen, tell the world, and drive adoption without Apple needing to discount the initial price of the player.

    If anything, Apple's strategy is the reverse (TFA points this out) -- making little or no money on music and enjoying handsome margins on the hardware.
  • which suggests that there is evidence to suggest



    Ack.

  • Meh... (Score:5, Insightful)

    by kotj.mf ( 645325 ) on Friday January 28, 2005 @04:44PM (#11508436)
    Is anybody else sick of hearing about the Transcendence of Gadgetry?

    I mean, Apple (and the drinkers of its Kool Aid) are probably more guilty of it than anybody else, but I see it all over the place.

    I like toys as much as anybody, but that's all they are to me: toys. It's been said over and over again to the point that it's now becoming trite, but these days, you're defined by what you buy. I never really got it until I noticed the market for knitted iPod cozies and lameass journalists who do nothing more than feed the marketing machine.

    We live in an age where most of the popular music sucks, the art is derivative, the churches are shills for either the GOP or NAMBLA, and people don't care what kind of horseshit the politicians shove down their throats, so long as they can buy it at Chipotle while dowloading ringtones.

    If I ever start waxing obsessive about my Zaurus, please punch me in the face.

    Maybe I'm getting old. Or maybe I'm just bitter that I'm currently too broke to afford most of these pleasant diversions. Whatever.

    • Tool or Toy (Score:5, Insightful)

      by SuperKendall ( 25149 ) * on Friday January 28, 2005 @05:20PM (#11508934)
      There is indeed a fine line between a tool, and a toy.

      For me, the iPod is a tool - because it lets me do things I would not practically be able to do otherwise and frees me from some efforts on my part.

      In particular what I really use my iPod for is to listen to music in my car. So for me it has replaced the need to constanly move CD's around, and the damage involved to them (I had a cd player in one car that if a CD was ever so slighlty thicker than standard, would leave a huge gogue straight across the surface).

      To me not listening to music in the car is not really an option. And since radio stations pretty much have poorer selections than a single CD, the iPod makes an excellent tool to replace both radio and CD in one fell swoop and give me more time for other things.

      So I would say, if there's something you do all the time anyway, and a device makes that thing in some way better - then it is a tool, not a toy.

      You can also reverse the process for other things. Take a table saw. Tool, right? Possibly, but a lot of people buy them just because they are big and cool and then hardly ever use it. So, I would submit that it is a toy and not a tool for many people. People are even quite happy to admit this because it is "cool" to own large power tools.

      So, it should not be so surprising that some things that might seem like toys are really tools to some people, which is why they get offended when you claim that it is in fact a toy.

    • Re:Meh Indeed (Score:3, Insightful)

      by DLWormwood ( 154934 )
      We live in an age where most of the popular music sucks, the art is derivative, the churches are shills for either the GOP or NAMBLA, and people don't care what kind of horseshit the politicians shove down their throats, so long as they can buy it at Chipotle while dowloading ringtones.

      First off, I'm a long time Mac user and software developer, so by rights I should feels some kind of satisifaction from seeing Apple "transcendant" again. That said, for all you people talking about iPods as if it was the g

  • The whole razor/blade thing doesn't make much sense anyway. The blade IS the product; you make a better razor by improving the blade. The handle is just a cheap piece of plastic that holds the blade.
  • You can use it with MacOS, you can use it with Windows, you can use it with Linux and you can use it with *BSD.

    LK

  • Do those razors cost that much? (Score:3, Interesting)

    by dracocat ( 554744 ) on Friday January 28, 2005 @04:49PM (#11508506)
    My Mach 3 razor is really just a piece of plastic that holds a blade.
    I am very skeptical that they loose any money on those razors, let alone that his has become an addage in marketing.

    But I could be wrong.
    • 'Safety' razors pre-date plastic. We have my great-grandfather's original Gillette safety razor: it's an attractive stainless steel, nicely decorated. Much better than the modern ones.

      Of course, straight razors are even better. I put 'safety' in quotes above because I nick myself less with a straight razor than I did with my old Mach whatever-it-was-then. And I'll never need to buy a razor blade again. Granted, I had to buy a $75 razor, a $50 strop and a $40 whetstone to get to this point:-)

      Plus, th

  • Comment removed based on user account deletion
  • Mr. RXC doesn't answer the one question of most use to all of us.

    Where is the best place to invest and make a fortune off of this?

    The obvious answer of Apple may not be the best answer. There are other places to go long or short as well.

  • A word on Netflix. (Score:5, Insightful)

    by ryantate ( 97606 ) <ryantate@ryantate.com> on Friday January 28, 2005 @05:04PM (#11508704) Homepage
    In this article, the columnist gets into a discussion of the Mac mini as "the Netflix killer," writing, "Apple has eliminated the most costly part of the NetFlix model while maintaining all of the good pieces."

    First of all, this is factually wrong. I just pulled up the Netflix 8-K annual report [edgar-online.com], which clearly shows annual DVD costs of either $103 million or $80 million (depending on whether amortized) and annual "fulfillment" (postage and packing) cost of $56 million.

    Second, while I agree the mini Mac is a promising digital video dellivery device, it is not a NetFlix killer. The smartest thing about NetFlix is not the great delivery and rental model, but the way it exploits copyright law. Once Netflix has purchased a DVD, assuming it does so at full price outside of a special contract it enters, it is allowed to rent/loan that DVD out an infinite number of times. That battle was fought and won on its behalf by the VHS rental industry long ago.

    What this means is that Netflix is happy for you to cycle through loads of different DVD titles every month, so long as postage doesn't eat too deeply into its profit margin. Essentially, its product is postage bound, not copyright bound, which is a fantastic position to be in.

    Any digitally streamed movie product from Apple, however, will almost certainly be copyright bound. Unlike Netflix, Apple will need special agreements to cover every movie it delivers. The easiest sell to movie studios is an a-la-carte movie purchase system like the music on iTunes. They then need to keep the cost per movie underneath Average_Netflix_Monthly_Fee/Average_Netflix_Monthl y_DVD_mailings to be competitive, but that's not all. They have to be cheap or fast or cool enough to ALSO justify the purchase of a new computer and/or the hassle of hooking a digital video stream up to a consumer television.

    The other model for Apple is a monthly subscription with all-you-can-watch streams, possibly combined with the a-la-carte model to attract the greatest number of users. But this will be, in my estimation, a very tough sell to the studios, and even if you get it up and running, it would need to be first price compeitive with Netflix and second sufficiently cooler to justify the cost and headache of connecting the TV to a computer and possibly buying a new computer.
    • Once Netflix has purchased a DVD, assuming it does so at full price outside of a special contract it enters, it is allowed to rent/loan that DVD out an infinite number of times.

      Netflix doesn't buy the DVDs. It pays for them by using a revenue sharing agreement with the studios. From their site [netflix.com]

      We are extremely pleased that the major studios recognize NetFlix as an important distribution channel for their content," said Reed Hastings, co-founder and chief executive officer of NetFlix. "With these revenue s

  • Apple solved the Chicken Vs. Egg paradox (Score:3, Interesting)

    by Alzheimers ( 467217 ) on Friday January 28, 2005 @05:08PM (#11508750)
    Apple's actually doing something pretty amazing -- solving the Chicken Vs. Egg paradox by providing *both* elements at the same time.

    -Why buy an iPod/MacMini if I can do the same thing with X?
    -Why buy music/movies through iTunes/iFlix if I have nothing to use it with?

    What they are doing is providing you with mutually inclusive needs, and tieing them both together with the one thing most other products lack: style.

    You need an iPod -- why? To play the songs you downloaded on iTunes. But *also* to be cool!

    You'll need a MiniMac -- why? To play the movies you downloaded from iFlix. But *also* to be cool!

    Face it, it's not an accident. These things were designed to work independently, but they're too complimentary not to require having both.

  • Applying the same model to video and linux (Score:5, Interesting)

    by buckhead_buddy ( 186384 ) on Friday January 28, 2005 @05:08PM (#11508760)
    I think the business model of item and service (aka razors and blades) isn't a good fit for the music biz. There are actually three markets that interact. The big music labels make the majority of their money in the control of the physical CD sales markets. While anyone with $100 can get a musical instrument, they control the distinction of who is a "hobbyist" and who is a "musician" by deciding who they give contracts to.

    Now Apple sells:

    • music consumption tools (AirTunes, iPod)
    • music creation tools (Mac, iLife, Logic)
    • a music distribution service (iTunes)
    Apple doesn't seem to be making much money with their distribution service. Most of the money goes to the traditional labels because they have the content people will pay for.

    But if iTunes can be established as a music distribution service, Apple is in a very nice position to create a "Do-It-Yourself" label service whereby dedicated hobbyists can put their works into a real distribution channel. Apple takes less money than the traditional big labels but they get more money than being dealers of the big labels copyrights.

    Of course, the big labels will abandon iTunes if they get a hint that Apple is becoming a content provider. But in two years time, who knows, iTunes may be a service that a big company couldn't back out from.

    There might be hints of Apple doing the same thing with other content. They already have a wonderful set of video creation and consumption tools; once badnwidth grows they might compete with the video/movie distribution channels. And then move in toward being a content distributor/provider in the same manner as they might do with the music market.

    As a fellow who remembers what a Steve Jobs Apple can do with absurd pricing models (e.g. late eighties mac and laser printer markets), I do still find it very exciting about the creative possibilities this could open up in music and video. I really hope Apple kind of succeeds in their challenge. What would be even better would be for a Libertarian/Open Source/Linux company to come in and do something similar.

  • The Coolness Factor of iPod (Score:3, Informative)

    by Nom du Keyboard ( 633989 ) on Friday January 28, 2005 @05:10PM (#11508781)
    The coolness factor of iPod is that it makes the statement:

    I bought my music! I support the artists!

    It may not be true. And given the average of 5 songs/iPod purchased so far (although that number may be questionable since it assumes all iPods bought are still in use -- which we know, due to battery problems, isn't true) probably isn't likely in nearly every case.

    Regardless of that however, I could be actually paying for my music now that I have an iPod, and no one else can gainsay me on it. No other player says that clearly.

    That's coolness!

  • I believe Jobs was working toward QuickTime/MPEG4 (Score:3, Insightful)

    by alfredo ( 18243 ) on Friday January 28, 2005 @05:14PM (#11508844)
    as the format for the movie industry. Instead of film in a can, movies would be transmitted by satellite to theaters. Looks like it will be to the home to the Mac Mini.

  • Duh! (Score:3, Funny)

    by MrNemesis ( 587188 ) on Friday January 28, 2005 @05:41PM (#11509136) Homepage Journal
    Look at the back of your iPod.

    It's quite definitely the shaving *mirror*.

    Honestly. /. eds these days ;)

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