[FulcrumPilot]

This guy thinks it will be SONY.


Imagining An iPod Challenger
Arik Hesseldahl, 12.07.04, 3:00 PM ET

NEW YORK - If ever there was a company that could challenge Apple Computer for the dominant position in the still-young digital music space, it should be Sony.

And yet, it isn't. Despite the strength of its now decades-old Walkman brand, Sony's (nyse: SNE - news - people ) various moves into the digital music player market and online music sales have come in fits and starts with little notable success. Sony's online music channel, Sony Connect, accounts for only a modest bite of the overall music download market, compared to 70% or more (depending on whom you ask) for Apple's (nasdaq: AAPL - news - people ) iTunes Music Store.

But, Sony is mounting a new attack from an unlikely direction: video games. Sony's forthcoming Playstation Portable (PSP)--a handheld gaming platform--will be primarily a gaming device. But, its use of a new Sony-created storage disc format--the Universal Media Disc, which stores nearly two gigabytes--can't help but become an easy method for selling music.

The plan, says Andrew House, executive vice president of Sony Computer Entertainment America, is to get the device in consumers' hands primarily as a gaming device and then use it to market music and video.

In a presentation at the USB Media Week Conference taking place in New York this week, House described the iPod as a device that consumers buy as an indulgence or for status.

"In the portable space, there are devices that are a necessity, like a cell phone, and there are devices that are indulgences," House said. "The iPod fits very much into the indulgence and status category and that is where we are going to go head-to-head with PSP."

Asked after his presentation if he saw the PSP-Sony Connect combination as Sony's main avenue of attack against the iPod-iTunes combination, House called gaming "fundamental" to the device. "Once we get the device in people's hands and they see how good it is with gaming, then we'll seal the deal with other content."

But, Sony's not the only firm thinking of digital music beyond the iPod. Edgar Bronfman Jr., chairman and CEO of the soon-to-be-public Warner Music Group, said in a separate presentation at the UBS conference that he sees a huge opportunity to sell the label's music on mobiles. If you're already familiar with the popularity of music ring tones, he said, get ready for the "ring back"--music that callers hear when they call you, instead of the standard ringing sound--in 2005.

That's just one way Bronfman expects music companies to try to milk their catalogs for new revenue via the wireless phone networks. He said he expects wireless phones to hold as much storage as is currently available on Apple's iPod Mini, which holds five gigabytes--sufficient to store some 1,000 songs.

"Eventually, the greatest competition [for the iPod] comes from the wireless network providers," Bronfman said. "If my cell phone--or one of those 1.3 billion cell phone users as opposed to the five million iPod users--can give me the same kind of functionality as the iPod, that's the biggest competition."

Apple may indeed have been thinking much the same thing when it cut a deal to make songs sold on the iTunes music store compatible with certain phones from Motorola (nyse: MOT - news - people ), the world's second--largest manufacturer of wireless handsets. That deal, which the two companies announced in July of this year, has yet to bear any tangible product offerings.

Wireless carriers are generally thought to be unhappy because they're not getting a cut of the action. Eager to boost their wireless data revenues, carriers want their customers to download music over the air. The terms of the Apple-Motorola deal would allow consumers to transfer iTunes songs they already own directly to the phone from their computer using Bluetooth wireless technology--for which carriers can't charge airtime fees--or with a data cable.

In his remarks, Bronfman complained about Apple's continued insistence on locking players other than the iPod out of iTunes by not opening its Fairplay digital rights management technology to others. When asked why the recording industry hasn't tried harder to force an interoperable music scheme on the consumer electronics industry and the digital music vendors, Bronfman laid part of the blame on his own industry, but most of it at Apple's door.

"Convincing Steve Jobs of anything other that what he believes is a Herculean task for anyone. I know it has been for me. He does not want interoperability," Bronfman said. "But I think interoperability will come, and I think consumers will demand it."

[Krusty]

"next" ipod killah ? Nobody has made the first iPod killah yet.

[CreepingDeth]

[What Krusty said]

[FulcrumPilot]

Originally posted by Krusty:
"next" ipod killah ? Nobody has made the first iPod killah yet.

What are you talking about!? There is an ipod killah being anounced once a week at least!!

[Kilbey]

Originally posted by FulcrumPilot:
What are you talking about!? There is an ipod killah being anounced once a week at least!!

And they all die a slow sad death...

Just remember people, competittion is good.

[storer]

Originally posted by Kilbey:
Just remember people, competittion is good.

True.

And there are iPod killers released every second day....

[Lancer409]

Originally posted by Krusty:
"next" ipod killah ? Nobody has made the first iPod killah yet.

wise words. Hey Hey!