Sunday, July 02, 2006

Apple faces the music as public discord with iPod grows
Sun 2 Jul 2006

IT IS the gadget that no fashion-conscious bright young thing can afford to be seen without. But two years after Britain fell in love with the iPod there are signs that the pocket-sized box that transformed the way millions listen to music is beginning to lose its shine.

Internet chatrooms are carrying accounts of "unreliable machines", while questions are being asked about working conditions in the Chinese factories where they are made. The "very significant" fall in public confidence is highlighted in new figures from YouGov's brand awareness index, which show a steady fall in the popularity of the Apple brand. More than 50 million have been sold since its launch in 2001, and the company insists that the quality of its products is not an issue, with the iPod remaining the most popular portable music player.

However, Apple's share price fell to an eight-month low last week after an analyst predicted that the launch of several new models would be delayed.

Sundip Chahal, of YouGov's BrandIndex team, said: "The overall brand index is showing a definite downward trend up to the beginning of April. The index for quality is going down - from a rating in the high 30s in October to the mid 20s, which is a very significant drop." The gadget's fall in popularity could be linked to bad publicity. Shortly after the launch of its iPod Nano last year, Apple admitted that some models had faulty screens that scratched too easily.
There have also been complaints on Apple's internet chatroom about the iPod Shuffle, its smallest and only music player without a screen.

YouGov claims that the decline in the brand's reputation may be a consequence of the company's early dominance in the MP3 player market. "Apple used to stand for corporate reputation and quality, and people were prepared to pay more because they got it back in quality," Chahal said.

However, Apple denies that it has a problem with quality. Greg Joswiak, vice-president of iPod marketing, said the company had a first-year failure rate of 5%. He said: "A lot of products don't enjoy such a low failure rate - mobile phones can be up to 30%. The vast majority of customers are extremely happy and have never experienced a failure. "Most problems are caused by mishandling. They are complex electronic components and they can be broken if dropped or mishandled."

Apple needs to learn a lesson that SONY learned very painfully in the 80's. Proprietary items rarely succeed past the initial phase of public curiosity. Sony if you remembered had a great product in the early late 70's early early 80's with the BETA MAX player. It was vastly superior to VHS but SONY would not license the technology to other firms. They choose to hold the patent and reap the rewards. They failed. Even with the movie studio backing they had. VHS on the other hand offered nearly everything BETA MAX did as far as functionality. In the long run Sony lost millions trying to hoard the market as well as consumer confidence.

The iPOD has more or less been a cash cow for Apple and its sole financial life raft. Without the iPOD Apple would have been in bad shape. The company in my mind is too dependant on this one product. Their stock price is showing it as well.

Don't get me wrong I like Apple computers and had been strongly considering buying a laptop from them and would have if the deal of a century hadn't come along.

Wake up Apple and get with program. License out the technology and open up iTunes to other users of MP3's and reap the rewards. In the long run you will be a better company for it. ~CW~


Blogger tooners said...

hmmmm... interesting post here. i really like the iPods. my hubby has one and adores it... he has an Apple computer too and swears by it. i don't have an iPod but want one. this is an interesting article... and something to watch over the next several months or year.

July 03, 2006 2:39 AM  

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