BusinessWeek Online columnist Alex Salkever muses about Apple’s new deal to build HP-branded iPods in his latest Byte of the Apple column entitled
“Apple + HP = iPod Forever”.
“The deal stipulates that Apple won’t co-brand iPods for any other PC company. But Apple will gain powerful distribution through HP’s extensive retail network, a development that likely will fuel a new wave of iPod purchases and a steady stream of people buying music through iTunes Music Store,” said Salkever.
But more, he suggests, it’s a slap across the face to Microsoft, which is pushing its Windows Media Audio (WMA) standard as an alternative to AAC and FairPlay, the digital rights management technology popularized by Apple both in the iPod and its iTunes Music Store commercial online music downloading service. FairPlay-encoded tunes bought through the iTunes Music Store won’t play on other digital music players beside the iPod.
“At the moment, Apple has over 70% of the market for the digital-music downloads, so the only real competition is between Jobs and Bill Gates. And Jobs is winning: The HP deal underscores that he’s the go-to guy for the music industry,” said Salkever.
Will Microsoft overtake Apple the same way it has done in the personal computer industry, by licensing its software to any comers? Salkever sees Apple’s refusal to let the iPod play any formats but what Apple wants it to as a potential strategic weakness, at least by Apple’s competitors. For his own part, Salkever said “I think Jobs has this one right.”
“The only real issue with choice is when one music-download site can’t offer the songs that users want. As long as Apple maintains the good graces of the music industry, it probably won’t face that issue. Add these factors up, and the digital music game, for the next couple of years at least, is Apple’s to lose,” he said.