Justin Jarvinen

http://www.vervelife.com

1 Comment

    • Amazon's Digital Download Challenge To Apple: Brand Doesn't Trump Experience (AMZN, AAPL) [view article]
      There isn’t much in your post to disagree with, but perhaps I can offer some out of the box thinking (or maybe just crazy thoughts) related to the ongoing digital media consumption debate.

      For starters, don’t forget that Amazon generates a significant amount of business by powering other retail sites. For music, they’re currently managing the back-end of Target’s music and entertainment site and fulfilling orders of physical CD’s (Target is getting into digital). With the few players that exist in the B2B digital music space (MusicNet and Loudeye, although more insignificant a player every day it seems), Amazon does have a rather compelling opportunity here. I haven’t seen this mentioned anywhere and maybe I’m way off, but the IFPI expects the number of digital download stores to increase 10-fold over the next several years and Amazon could be right there.

      Another thought is Apple’s reliance (and dominance) on great design. Did I say great? I’m a Mac and iPod guy. I mean, Apple makes beautiful stuff! It doesn’t hurt that the iTunes user experience is fantastic as well. But my point here is that, even with the inferior interior of Motorola’s RAZR phone, it became a blockbuster primarily because of its slick design. Apple has been through this before and there’s good chance they’ll suffer if some slick new design comes along (with a bundled music service). Sometimes that’s all it takes. Consumers who buy on the basis of design are far more fickle than others, and most of the iPod owners are still PC people. At the end of the day, iTunes is successful because of the iPod, and the iPod became successful in large part because of its design (hardware and interface). And besides, everyone knows the mobile device is going to be the new battleground anyway.

      And what about the brands that were mentioned? Pepsi had major problems with the two promotions that were mentioned (in large part because of logistics… “see through” bottles). But brand or ad supported music services like Pepsi Smash on Yahoo! or the new Napster, or fully owned branded entertainment sites that offer free music, movies and other digital content such as PowerbarTunes, paid in whole by large brands, are dramatically under recognized by analysts. As soon as Soundscan begins tracking non-traditional means of paid marekting and distribution (such as branded entertainment campaigns where the brand picks up the entire tab), you’ll start seeing a new name or two appear on the radar.

      Justin Jarvinen
      Founder & CEO, VerveLife
      vervelife.com       Jul 17 07:39 PM
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