Apple's small-minded strategy

Posted by Mark Everett Hall

Among its few improvements, the latest update to iTunes (version 9.0.2) lets the handful of users running Apple TV 3.0 connect their iTunes library with their set top box. At the same time it breaks the automatic synchronization Palm Pre users have with their iTunes music. Pre users once saw their device's icon in the iTunes navigation bar, but it's no longer there. Apple has screwed some of its iTunes users.

This is the third time Apple's iTunes upgrades have made life more difficult for Pre/iTunes users. The same will be true for Droid users once it gets sync capability for iTunes. Any device with a remote chance of competing with the iPhone will be fought on the iTunes battlefield.

Yes, back in June Apple warned everyone against syncing non-Apple music players with iTunes. So no one should be surprised. What's so head-scratchingly strange about the whole thing, though, is that someone inside Apple thinks making life more difficult for its software customers is good for business. That's how Microsoft is supposed to think. Not the end user-loving denizens of Cupertino.

Wrong.

Apple is acting just like the snotty monopolist it has become in electronic music distribution and combined that lousy attitude with the presumptive arrogance of a smartphone monopolist. That strikes me as an indefensible and doomed business strategy.

The problem is that, unlike Microsoft which locked in businesses with its software practices, Apple is trying to lock in fickle consumers with ephemeral products and services in a highly competitive market. It's expensive and difficult for companies to switch from one spreadsheet to a different one or from one network server to another. But it is not that hard or costly for consumers to change their minds about the latest faddish toy.

Businesses will whine about vendor lock-in by Microsoft or IBM, when it suits them. But, in truth, they really don't care that much. IT departments don't want the coolest, best technology. They want predictability and stability.

Consumers are not IT departments. They want what's cool. They want easy to use. But Apple is making its own software harder for people to use. It’s telling consumers who have the temerity to buy non-Apple branded smartphones and music players to go to hell. That is exceptionally stupid long-term thinking.

Consumers will remember in their next buying cycle. If they get Droid or Pre envy or crave whatever comes after those devices, they will feel personally insulted by Apple for restricting what they can do with the software on their computers. And, slowly at first, then snowballing faster than Apple can react to, consumers will find a way to get their music from other sources, such as Amazon or (maybe?) Google. And they will gladly chuck their iPhones for the next cool thingamajig.

So, why is Apple, full of many smart people, being so strategically small minded? Why does Apple put barriers between its customers and their software? Maybe as a monopolist it does so simply because it can. Maybe it's just the way every monopolist acts.