• Newsletter Issue #425

    January 20th, 2008


    So was the Macworld Expo a smashing success, an abject failure, or something in between? Well, on The Tech Night Owl LIVE this week, we explored the possibilities, with a trio of guests on hand to cover the subject.

    First up was key industry analyst Ross Rubin, of the NPD Group, who will weighed in on the impact of the MacBook Air and other new Apple gear to the tech marketplace. For the most part, he seemed positive about it all, although he reminded us of the fact that previous excursions by Apple into the thin and light note-book arena weren’t all that successful. The PowerBook 2400 series, for example, had its greatest impact in Japan, but didn’t go over all that well when the product was introduced in the U.S.

    Of course, Apple was very much a different company then. The MacBook Air has fashion statement written all over it, and I can see people who are willing to live with its feature compromises buying them in huge numbers. Will those numbers be huge enough? Good question.

    Denis Motova joined me in this week’s “Tech Junkies” segment to decide whether the MacBook Air is for him. His biggest concern is that it may not be sturdy enough to sustain the rigors of heavy use in a business environment. You really can’t baby a note-book computer, so maybe he has a point.

    For a hard-nosed viewpoint on the good, bad and ugly aspects of the Expo keynote, we took another excursion into the wild and wooly “David Biedny Zone.” David pointed out that, despite is seemingly high purchase price, the MacBook Air is actually less expensive than a lot of its competition.

    On The Paracast this week, you’ll hear from keptical researcher Robert S. Lancaster, who runs a site known as stopsylviabrowne.com.


    In theory, respectable newspapers devote a small amount of space to correct errors. When it’s an online news outlet, posts can be easily modified, and, when appropriate, the nature of the correction would be highlighted or explained in an addendum to the post.

    Unfortunately, there are far too many members of the press these days who, out of laziness, a blatant disregard for facts or for reasons unknown, choose to repeat the same falsehoods over and over again. You can correct them day and night, and it will make no difference.

    Once they write the words the first time, they become immutable. They cannot be changed, ever, and to hell with the facts.

    Now I have written rants from time to time about the unfair coverage Apple often gets from certain elements of the media. But I don’t want to take the paranoid point of view, that the press is out to get Apple and/or Steve Jobs. It’s just that some have certain agendas that may simply stem from a desire to get higher circulations or hint counts. They might even regard a few paragraphs of pithy, if totally incorrect, comments as having some sort of entertainment value. One of the worst offenders in the entertainment arena is John Dvorak, and he’s not entertaining — at least to me.

    Sure, you might get a few yucks from a clever turn of phrase, but tech journalism isn’t akin to writing for a sitcom, or maybe some of these writers produce movie and TV scripts part time. Being out of work for now, till the Writer’s Guild strike is settled, they forgot how to separate facts from fiction.

    Well, I’m not entirely serious about that, but I do have my suspicions from time to time. At least Apple is no longer the beleaguered company, although I still think some pundits who gave up that catch phrase are still tempted to invoke it again at the slightest inkling that something Apple is doing isn’t entirely successful.

    But the real issue here is the lie itself, and when it is presented as the unvarnished truth, it has to be corrected — over and over again. But I am optimistic that, some day, the truth will out.

    Take the claim that you pay a premium price for a Mac. That was once true, and when it comes to displays and RAM upgrades, it’s still true. But, for the most part, when you do the proverbial feature-for-feature match, Apple emerges surprisingly competitive.

    Consider the MacBook Air, which is being matched up with thin and light note-books from Sony. When you do that comparison — as David Biedny did on last week’s episode of The Tech Night Owl LIVE — you end up paying hundreds less for the Apple note-book.

    This doesn’t mean you can’t find a Windows note-book for less money from another manufacturer. But you still get back to the features offered by each manufacturer, and here’s where Apple offers a tremendous amount of value.

    It is not a lie, though, to say that I still think Apple is still ignoring a potentially profitable product, a mid-priced headless desktop. I’m talking about something akin to the innards of the iMac delivered in a case that provides a reasonable amount of expansion capability. That would mean space for two internal drives, four RAM slots and two PCI slots for graphic cards, a RAID card, an extra networking card, and so on.

    Would such a computer cannibalize sales from the Mac Pro and perhaps the iMac itself? Maybe. But a sale is a sale, and I rather think that more Windows converts might come aboard to actually enhance sales. Sure, desktop computers are no longer fashionable in the Apple universe, considering the rapid growth in the note-book space. But that doesn’t mean that there isn’t a healthy market remaining.

    As to ignorance: The other day I read a column from someone who made a big push for Apple to license Mac OS X. Now I suppose, on the surface, this might seem like a ripe opportunity. After all, Windows Vista hasn’t set the world afire. In fact, early customer ratings show that it is viewed far less favorably than even Windows XP. There’s now a petition out there urging Microsoft to extend the life of XP, which has to be embarrassing. When did that occur with any previous version of Windows?

    But what this talk of Mac OS licensing overlooks is the fact that Apple tried it once, and it nearly killed the company. They also cannot make a satisfactory economic model for so massive a change in Apple’s OS strategy.

    Yes, we know that Apple sold nearly five million copies of Leopard, and that close to 20% of Mac users have upgraded either through retail kits or as the result of buying new Macs. But that doesn’t mean that letting any old PC run Mac OS 10.5 will somehow increase Apple’s income to compensate for the major loss in hardware sales.

    Apple is on a sharp upward curve. Even though some of you may have hoped for more insanely great products at the just-concluded Macworld Expo, the ones that were introduced will probably be sufficiently successful to keep the company on a sharp upward sales path.

    In other words, Apple’s vision and its strategy continues to succeed way beyond what the analysts generally predict. The Mac OS remains tightly integrated with the various products on which it’s installed, which now also includes Apple TV, the iPhone and the iPod touch. Providing an integrated solution happens to be a good thing, at least for Apple.

    It’s too bad that some tech writers continue to drag out tired arguments that attempt to turn reality upside down. Lies? Ignorance? A combination of the two? Does it really matter?


    Back in the old days (the 1980s), I’d go to the local video store on a Friday and take home two or three VHS videos for the weekend. I had to return them on Monday, for otherwise I’d pay an extra dollar or two per day, each. in late charges. All right, if I called the owners and pleaded with them as to how I had to work late that day, they might give me a break. You cannot, of course, do that with a large chain store.

    When you use one of the pay video channels from your cable or satellite provider at home or at a hotel, the price you pay is generally for a single viewing. There are more liberal variations on this theme, but that’s the basic scenario.

    I suppose in introducing movie rentals at iTunes, Apple was using the latter as the business model. Yes, you have 30 days to push Play, but only 24 hours to see the entire flick before it self-destructs and you’re forced to rent it all over again if you didn’t it from beginning to end within that narrow window.

    Now please understand that Apple didn’t foist this retrograde deal upon the unsuspecting public to exact extra rental fees. That was the price they paid to get all the movie studios onboard. I can well believe some columnists are on the ball when they suggest that the movie industry is actually stuck in a time warp, believing that the business plans of two decades ago still apply.

    Of course, if millions don’t line up to rent movies from iTunes, some will blame that failure on Steve Jobs for agreeing to such a lame arrangement in the first place. Or maybe Jobs will, in turn, use that as evidence that they need to liberalize the restrictions. What about 48 hours or 72 hours? That ought to be more than sufficient to make the whole deal acceptable for those who just want to grab a movie at the last minute and are loathe to wait a few days for Blockbuster or Netflix to deliver a copy to their snail mailboxes.

    For me, I can’t see it. If I need instant gratification, I can go to the local convenience store, where there’s a kiosk display that lets me rent any of several dozen current releases for $1.00 a day plus tax. They accept major credit cards, so if you don’t return it in a single day, you get charged appropriately. After 25 days, the movie is yours to keep, at the $25 pricetag. It’s a simple setup, and, if there are enough copies of current releases stored inside, it might emerge as a worthy competitor to other movie rental alternatives.

    Except for selection, of course. There Netflix has the upper hand, and now with an unlimited download feature, there’s always hope they’ll go for the gold and deliver a Mac version.

    For me, I can’t imagine embracing any pay-per-view situation unless Barbara and were on vacation, got back to the hotel early and couldn’t find anything to watch on free TV. That hasn’t happened in recent memory, however.

    So I’m not terribly enthusiastic about the possibility of renting any movies from iTunes, even with the HD alternative should I opt to purchase an Apple TV. That, of course, might change, but not until Apple and the movie studios can agree to a rental setup that shows a modicum of common sense.


    The Tech Night Owl Newsletter is a weekly information service of Making The Impossible, Inc.

    Publisher/Editor: Gene Steinberg
    Managing Editor: Grayson Steinberg
    Marketing and Public Relations: Barbara Kaplan
    Worldwide Licensing and Marketing: Sharon Jarvis

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    One Response to “Newsletter Issue #425”

    1. shane blyth says:

      Isn’t at all about stiring up controversy to get traffic to there site? We all get up in arms and want to tell them they are wrong so we read news feed rush over while they smile saying to themselves “suckers” now my sponsors will be happy with all this traffic.
      I hear Dvorak on Twit sometimes and he doesnt bother me. He is a bit of a stirrer and funnily enough I have heard him recommend Macs to listeners. But I know what you mean. I just try to ignore them and not play their games.
      The problem is though mud sticks. A recent example at my work a reporter talked about our company saying something that was a 1/2 truth. All the local people got up in arms about it and we now have to explain to them why we do things this way. This was years ago and they still moan and make smart comments so the mud stuck. It is really stupid how we trust the media so much and never seem to question their truthfulness. A classic for us was a friend jumped off a cliff into the sea where lots of people do this.. he is a bit of a daredevil . The papers and local TV stations went nuts over it. One report showed them interviewing him… It went like this.
      “Would you jump again?
      ” Yes” was his reply.
      A second TV station showed the same interview which was somewhat different in content.
      ” Would you jump again?”
      “Under the correct conditions with appropriate saftey measures and supervison then Yes”.
      What a totally different report!
      People hated him and where really nasty (well the ones who saw the shortened report) Just shows you, never believe or trust the truthfulness of any media or reports. They are all skewed to some extent or another. The real problem is how people sit there and believe everything told them through media. That is hellishly scary! I was aghast at this total passive “the media said it so it is true” attitude.

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