Jobs vs Bezos. The Civil War for our hearts, our minds, our attention.
[6 March 2012: Brian: This post is now 18 months old but I thought it worth revisiting considering that Apple will announce a new iPad tomorrow and to date the only challenger to the tablet crown is Amazon's Kindle Fire.]
I've written previously re an Amazon tablet. I do not believe this will be a Android tablet as Amazon clearly wants to retain tight control over the entire search, buy, download, manage, recommend meta-process. I do believe it will be a direct shot across the iPad bow. While others talk about iOS vs Android, they leave out a far more interesting battle: Amazon vs Apple.
With the Kindle, Amazon, long the world's largest online store, has proven that they can create a great hardware device -- albeit with a very deliberate focus (books). Alas, it is no iPad, and big as they are Amazon is nonetheless only the second largest online media store, after Apple's iTunes. And this is where the war for the hearts and minds of our content dollars will be waged. Expect the destruction of multiple industries to be the end result. One of my primary laws of the smartphone wars is that we the users want what we want when we want it where we want and on the device we want it on. For digital media, the only two curently in the running for achieving this are Apple and Amazon.
Amazon has proven they can create a very popular tablet for books, less so for blogs and newspapers and magazines. They do a decent job of offering streaming music and streaming video, provided you are seated and in your house. Apple, of course, is just the opposite. Great for music and video, great for the web, great for newspapers, okay for magazines, losing the war on books. Sublime on mobile devices. Elsewhere, far less so. And there was an uneasy truce, of sorts.
Then Amazon went and hired a former Microsoft gaming exec.
Next, Apple made buying -- and recommending -- music and videos easier, with the launch of Ping, and, counter-intuitively, more stationary, with the creation of the new Apple TV.
At which point, Amazon announced the low low price of 99 cents to own a video. Not rent, own. For 99 cents.
More and more these two companies, which for so long had little to fear from one another, are gearing up for all-out war. Amazon gets their content onto more stationary devices (Roku boxes, PCs, select TVs). Apple wins on mobile devices (iPads, iPods, iPhones). Apple has made it clear: they want a cut of every bit of premium digital content we watch, view, read, hear, play. For Amazon, this is their turf: books, dvd's, cd's, game dics. Only, they realize the world of such content is, now and forevermore, all digital.
The fact is, the world is also going mobile. In both instances, Apple wins. For now. No point in using Amazon for videos, books, music, games, in our homes, if we can't take it with us. And, unlike with the Kindle app, Amazon has no insurmountable lead in the distribution of music and video and enabling an app that supports Amazon-purchased music and video, across multiple smartphone devices, is not likely to happen. Apple, of course, understands that we have all this content on our portable devices. Yet, there are times we want to watch it on our big screen at home, listen to it on our stereos.
More and more, the two companies are nearing a collision course. We are not likely to watch Apple-purchased tv shows on our iPod then switch over to Amazon to watch the next episode on our television set. Plus, this requires user identities, payments platforms, cloud-based services. All of which both have. All of which are different.
Both giant companies are gearing for a fight, one I find far more interesting then the typical smartphone market share discussions. Once Android surpasses Apple, then Blackberry, in smartphone market share, then what? Email is email. We all access the same Internet. We are all using essentially the same carriers. Fighting it out at all costs here becomes a zero-sum game. However, there's still going to be real money made off the books and blogs and music and games and tv shows and movies that we value enough to pay money for. All the stuff we want on our smartphones!
Right now, Apple has the clear advantage. Our content must be liberated, able to go with us. Apple wins. Digital media is the present and the future. Again, Apple has the lead. Amazon, however, did not become the world's largest online commerce destination by retreating from lucrative markets, certainly not the ones that essentially defined their company from the beginning. And they have never been a company that stood still as the world changed.
This is made even more interesting, to me, by the DNA of the respective companies, both of which so clearly mimic their founder's values. Jobs wants:
- control plus
- user experience
- plus margins.
Bezos wants
- control plus
- user experience
- plus scale.
That last point, the fundamental difference, is where the bloody action will take place. How does Apple maintain margins when we can get that content from a worthy competitor? How does Amazon extract the full value of scale when Apple controls so much of our media dollars? Google and Android are about scale, yes, but for differnt purposes. By achieving scale, Google gets to upend an entire industry, making money by taking out all the money of that dying industry. Amazon doesn't want this. They want scale, volume, absolutely, but because they so value the content itself that to thrive they must sell a lot of it. They do not want a book or a song or a movie reduced to free. That kills their business, that destroys the very art of the art. Bezos would sooner resign. Steve Jobs similarly values creation at least as much.
Jobs and Schmidt are not alike. Schmidt doesn't really understand Jobs and Jobs doesn't particularly like Schmidt. But Jobs and Bezos, that's different. Like two brothers of different mothers.
A non-civil war is about to erupt. For our ears and our eyes and our thumbs, for our viewing enjoyment, our listening pleasure, our downtime, our recreation -- our attention. I suspect, in the end, both men, both businesses will remain strong and standing. Every other industry connected with media, however, will not look anything at all like it does today.