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Summary:

The products created by Apple and its founder Steve Jobs have revolutionized a host of different industries in the past couple of decades, from personal computing to mobile telephony. But they have also had a substantial impact on the way we consume media of all kinds.

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The products created by Apple and its iconic founder Steve Jobs have revolutionized a host of different industries in the past couple of decades, from personal computing to mobile telephony — but they have also had a substantial impact on the way we consume media, whether it’s music or magazines or books. The iPod arguably helped to save the global music industry from certain death, and the iPad has become the default reading device for many, and helped spawn a whole category of me-too devices. The terms that Apple dictated to record companies and publishers were strict, and the company has been justifiably criticized by many (including us) for taking a “walled garden” approach to media on its devices, but there is no question that they have changed the landscape significantly.

The first disruption, of course, came with the iPod. Although it wasn’t the first portable digital-music player, Apple reimagined what such a device could be — and single-handedly created a massive and growing market for digital music. Armed with rocketing sales of the device, Steve Jobs was able to do something no one else had been able to accomplish previously:  convince the world’s major record labels to hand over their content to someone else in digital format, in return for a share of the proceeds. And with billions of songs downloaded since, it wouldn’t be an exaggeration to say that Apple helped to save those record labels from a much worse fate than they would otherwise have faced.

A media consumption device, disguised as a phone

The iPhone was another ground-breaking media consumption device, disguised as a phone. With the introduction of apps and the app store, media companies of all kinds could provide a simple window into their content that wasn’t available before, instead of forcing users to come to their clunky mobile websites. Newspaper and magazine publishers scrambled to develop apps, partly in the hope that this new platform would convince their readers to pay for content, in the same way that iTunes and the iPod convinced music fans to pay for something they used to download for free.

Those hopes were accelerated even further when word came that Apple was working on a magical new device called the iPad. Newspapers in particular salivated at the prospect of creating an “iTunes for news.” Many saw this as a way of turning back the Internet clock and charging users for content — something only a few publications such as The Economist and the Wall Street Journal  have so far been able to get away with — and also a way of filling the revenue gap that was opening up between print advertising and online advertising. Unfortunately, even Apple can’t work miracles, and the number of publications making substantial sums from their iPad apps is virtually zero.

As we have pointed out before, the partnership between Apple and media companies of all kinds has never really been a fair one. In almost every case, Apple has dictated what publishers can or can’t do — and even rewrites those rules whenever it wishes, as it did earlier this year, with the rules around charging customers through the app vs. through a separate website. On top of that, it has taken 30 percent of their income for the privilege. But the willingness of almost every major content creator to accept these terms is a testament to Apple’s dominance of these new markets, and the desperation with which many companies wanted to be a part of what the company has created.

Apple threw a grenade into the e-book marketplace

Even in a market where Apple was playing second fiddle — the book industry — Steve Jobs managed to throw a grenade into the marketplace that disrupted it significantly. In the months before the iPad launched, Amazon was using its market dominance to convince (or force) the major publishers to drop their prices for e-books to stimulate the market, and even yanked one publisher’s books from its virtual bookshelves to put a little added pressure on the agency. In many ways, it was the Apple of the e-book business at that time, with the market power to dictate terms to anyone and force them to accept.

Then along came Apple with a giant olive branch for publishers: the introduction of the “agency model” of pricing, which reversed the standard retailing practice of allowing the seller to set prices for books, and allowed publishers to retain that power. It was the exact opposite strategy to the one that Apple employed when it started iTunes — where it played the role of enforcer and convinced record labels to lower their prices to a standard 99 cents — but it worked brilliantly in getting publishers onside and destabilizing Amazon (of course, it also led to a class-action lawsuit launched against Apple, alleging collusion with those publishers in setting unfair book prices).

The agency model didn’t make Apple the biggest e-book seller by any stretch; that status still belongs to Amazon. But it forced Amazon to try harder, something Steve Jobs was legendary for. And without the iPad, it’s unlikely that Amazon would have come up with something like its new Kindle Fire tablet, which promises to extend that company’s disruption of content from books into magazines, newspapers and other former print products, as well as video and audio content (and also mimics Apple’s control over that content and the 30-percent fee it takes for the privilege of enabling it).

Thanks to Jobs’ vision, and to the design of Apple’s devices — the touch interface, the non-computer-like operating system, the ease of use — and the powerful Apple ecosystem, the iPod and the iPhone and the iPad have each played a role in disrupting virtually every form of consumable media, from music to text to video. Even if those devices hadn’t generated hundreds of billions of dollars in revenue and turned Apple into one of the most valuable companies on the planet, the long-term effects of that disruption have created a legacy that puts Steve Jobs and Apple miles ahead of almost any other company in recent memory.

Post and thumbnail photos courtesy of Flickr users Rego Korosi and Giuseppe Bognanni

  1. Only the first mover can create a walled-garden. All other followers must be open.

    In most cases, Apple had first-mover advantage. Hence the walled-garden.

    The exception was in books, where there was a successful incumbent (Amazon), hence Apple’s olive branch (though Apple already had the dominant tablet).

    The lesson is that late-comers to a market must be very very open, and forego some of the profit to break through.

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    1. That’s a great point — thanks for the comment.

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  2. Unfortunately the world will never be the same again after this loss. Will have to see if Apple can manage it.

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  3. do you remember what Clinton said: I did it because I could! Apple could and still can!

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  4. Steve did what no one else had the power or the will to do – he stood toe-to-toe with the music industry and demonstrated how to save paid music from themselves. As consumer-friendly as that was, it felt that it went the other way with publishing/iPad. Amazon seemed to do most of the heavy-lifting only to be forced to *raise* e-book pricing (at Apple’s hand).

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  5. When the world looked at P2P file sharing, such as Napster, and thought ‘that’s illegal let’s shut it down,’ Steve Jobs thought, ‘that’s the future, let’s make it better’. Pretty amazing. More here… http://bit.ly/ogMOjH

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  6. Michael Grisham Friday, October 7, 2011

    Many people wanted music, and they were downloading it for free. Jobs found a way to get money for digital music (and kept some for Apple. Thbig problem for newspapers isn’t that people are stealing them, it’s that not enough people want them.

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