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The iPod is doomed ...
By Gearhead, NetworkWorld.com, 05/12/05
In a interview with the German newspaper Frankfurter Allgemeine Zeitung published on Thursday Bill Gates was reported to have said that: "I don't think the success of the iPod can continue in the long term, however good Apple may be."
Exactly! And the same is true of every product ever made ... including Windows ...
Just as biology is driven by Darwinian forces so are products. An ecological niche (market) appears, gets exploited by an organism (product) then, over time, the conditions that defined the niche change. The exploiting organism (product) adapts or not. If the organism (product) fails to fit the niche well enough it eventually becomes extinct. You could think of products having their own genome defined by their intellectual capital -- intellectual capital in its broadest sense of the patents that define its structure and methods along with the processes that produce and deliver the product.
Products, like organisms, are tested by their environments for functional value, cost benefit, and so on and how well they fit their niche all of which determines their success.
Some products such as the pencil have shown remarkable durability with little change in form despite tremendous market changes. This is because pencils fit their niche very well. Other competing designs have appeared (for example, the clutch pencil) and found their own niches (or sub-niches) but the traditional pencil is still, well, a pencil -- a wooden wrapper around a graphite core. Its genome has changed (specifically the processes involved in making pencils as well as the methods for getting pencils to market) but it is still essentially the same product.
But more complex products have to evolve faster and faster to maintain their fit in their niche. Consider cars. Once they became a mass market item they evolved and continues to evolve at an astounding rate because each modification that improved their fit in their niche became part of the definition of the niche.
There's a logic to Darwinian evolution that has interesting consequences: For example, in the natural world whales have a vestigial pelvic girdle which is useless to them. The interesting thing is that the impact of possessing a useless pelvic girdle on the success of the species is currently negligible so it doesn't get "selected out."
In the product world Windows is known to have hundreds of hacks built-in to specially support other applications (primarily Microsoft's). When those applications die out (as they surely will) what Windows will be left with will be, in effect, vestigial code. And don't try to tell us that the code will get cleaned up -- just as there is no value in nature at present to the whale losing its pelvic girdle and there is no present value to removing the vestigial code from Windows.
The interesting thing is how these vestigial structures can become a liability when the niche changes. With whales it is possible that someday the vestigial pelvic girdle might become a liability to the species and will be either selected out or the species will become less viable (less common) and ultimately become extinct. Perhaps global warming will trigger toxic plankton blooms in the lower latitudes that will cause whales to spend more of the year in colder waters causing arthritic inflammation of the vestigial pelvic girdle which reduces the ability of the whales to catch food which leads to lower calf weight which leads to increased infant mortality ... you get the picture.
But the world of humans is different. Consider the human appendix. The appendix, which is useless, is actually dangerous to many humans because it can get infected and cause death. But we're smart monkeys and we have figured out how to fix ourselves with drugs and surgery (we're super-biological) so we save those who would otherwise be removed from the gene pool. The end result is that we are, in practical terms, less viable as a species as far as the natural world is concerned. But what we've really done is not transcend the niche but change it -- we have redefined the niche and in the process redefined what a biological niche is!
Which makes us wonder when the vestigial code in Windows will become a liability. Arguably it already is as antiquated architectural features of Windows allow for many of the problems that Microsoft issues an endless stream of patches for.
Anyway, a product that is successful always raises and sets the bar for functionality and/or cost benefit. Consider the market for portable digital music players. When the iPod was released the market was dominated by MP3 CD players along with a few early hard disk-based, functionally poor products. The iPod was the functional success (arguably cost wasn't the primary issue when -- it was high but acceptable) and so it redefined the niche.
Since the iPod's market ascendancy a wave of competition has appeared but none of the new products fit the niche better than the iPod or manage to redefine it ... so far. The reason for this is that the iPod's value is not only defined by functionality and financial cost but also by fashion, a value dimension that is a powerful force in establishing, maintaining, and destroying market niches.
But while fashion isn't quantifiable as are functionality and cost benefit it is just as powerful a force. Fashion often serves to justify a product fitting a niche when a rational assessment of functional value and cost benefit would indicate otherwise (just consider a Louis Vuitton handbag).
So, Gates is right, the iPod is doomed. Fashion will change and other products will appear with improved functionality and greater cost-benefit that fit the market niche better.
And Windows will suffer the same fate.
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Comments
Man, all this talk about iPod being doomed is kinda everywhere. By far though, the most detailed and bleak article on this is here:
http://www.devhardware.com/c/a/Mobile-Devices/Recording-Industrys-Next-Target-iPod/
The article has a whole different take on it than this one. Personally, I feel it's a must read.
Posted by: Art D. on July 25, 2005 08:04 PM
