It’s hard to know whether it was all prearranged, or whether Walt Mossberg and Kara Swisher, the hosts of this week’s AllThingsDigital conference, make a habit of asking softball questions of prestigious guests, but there were no attempts to pin down Steve Jobs on the critical questions. Call the performance closer to a Larry King interview than one involving the ever-acerbic Bill O’Reilly.
Regardless, Jobs made a number of fascinating statements, delivered with obvious sincerity in his typically direct fashion. Unlike just about every other CEO on the planet, Jobs never minces words, and says — or appears to say — exactly what is on his mind, whether you agree with him or not. However, most of his views appear to be right on the money, although I expect some of the armchair media critics will try to spin those statements out of control.
Take, for example, his pointed comment about the decision to block Flash from Apple’s mobile platforms: “We have the courage of our convictions. We’re going to take the heat because we want to make the best products in the world for our customers. If we succeed they’ll buy them, and if we don’t they won’t.”
In other words, Apple customers can make Jobs reconsider Flash simply by not buying the products, or purchasing them in smaller numbers. It’s really that simple. Right now, the surveys demonstrate that only a small number of iPhone and iPad customers really care that Flash isn’t there. That is an extremely significant fact that Adobe clearly has difficulty facing.
But as I wrote in yesterday’s column, Adobe quickly found a way to build a version of the Wired magazine app for the iPad that’s fully compliant with Apple’s current development standards, one that doesn’t depend on Flash. It is also a sales success, so Adobe clearly wasn’t left in the lurch. They can change, and they can continue to provide useful tools for content creators even if Flash disappears, as it inevitably will.
Jobs also seemed to throw cold water on the possibility that you’ll be seeing a major revision to Apple TV anytime soon. Even if the rumored $99 iPhone-based streaming version does see the light of day, it will just be another experiment in a long line of experiments. In the end, the current state of affairs with cable and satellite providers makes it near impossible for third parties to build competing set-top boxes, even if they are far better than the bundled versions.
Sure, today’s TiVo is probably superior in most respects than the ones you rent or get for no cost. But therein lies the dilemma. How do you compete against free? Even at $10 per month for a product than delivers maybe 75% or 80% of what a TiVo offers, why buy the latter? The fact of the matter is that TiVo is making most of its money from software licensing.
If Apple tries to build a full-featured set-top box, they will face the very same hurdles. Adding one more box does little more than increase the clutter without solving the fundamental problems with the TV industry. As Jobs says, “The only way that’s ever going to change is if you can really go back to square one, tear up the set-top box, redesign it from scratch with a consistent UI across all these different functions, and get it to consumers in a way that they’re willing to pay for it. And right now there’s no way to do that.”
So Apple TV, however Apple redesigns the product, is destined to remain a hobby for the foreseeable future.
Another significant statement to come out of the session was the comparison of the PC and mobile platforms to trucks and cars. Over time, the PC (the trucks) will become a tool primarily for creative people. Those who use computers to consume content will gradually migrate to such portable devices as the iPhone and an iPad (the cars). As much as Apple continues to expand sales of the Mac, Steve Jobs understands that the PC era is pretty much over, and it’s time for the next great thing to take its place for most consumers.
To Apple, it’s their mobile platform. At the same time, Microsoft clearly hasn’t a clue how to survive in this brave new world. The lion’s share of their profits still come from Office, Windows and related software. Attempts to expand beyond these core product lines have had at best mixed success, which is why Microsoft conducted another round of executive musical chairs very recently.
Unfortunately for Microsoft, the man at the top, Steve Ballmer, is clearly unable to clean up this mess and move the company beyond its dinosaur technologies. Microsoft in the 21st century is very much in the position of IBM in the 1980s, and they will continue to suffer greatly as a result.
This doesn’t mean that another company can’t supplant Apple some day as the biggest tech company on the planet. But so long as Apple, under Steve Jobs or a successor CEO, continues to operate as an aggressive startup, that’s not going to happen quickly or easily.