Mar 11

iPod: Apple’s quiet monopoly

Remember the good old days when iPod was Apple’s most thrilling product?

Damn those iPhones and iPads, stealing iPod’s thunder like that.

Sure, iPods still get their buzz every September with the new holiday line. The crowds still show up. But clearly today’s iPod lives in the shadow of its more glamorous siblings.

Relatively speaking, iPod goes about its business quietly — if it’s possible to be quiet when your business is maintaining a massive, competition-crushing stranglehold on your category.

Shortly after its birth, iPod grabbed over 80% of the music player market. It was simple, elegant, and the combination of iPod/iTunes just couldn’t be matched.

But nothing’s forever, right? Every intelligent observer assumed that at some point, competitors would appear to bring iPod’s market share back down to earth.

That never happened. Later this year, iPod will celebrate its tenth anniversary — and its tenth year of dominance.

In technology terms, that makes iPod a senior citizen. Yet it still performs like a newborn.

I honestly can’t remember any one product line that’s held such a lopsided advantage for so long. The most recent numbers I can find (July 2010) show iPod owning 76% of the category. Holy hell.

Not that others haven’t tried. Zune was probably the most credible challenger, but could only sputter.

I once had an inside look at the iPod-killing business. I was invited to work with an agency making a pitch for a new Sony music player. Some assignments seem silly only in retrospect, but this one seemed silly even at the time. Our mission: “Bring down the iPod.”

It was an incredible delusion on Sony’s part. Not only was this particular music player a faint echo of an iPod, Sony was willing to invest only $15 million in the marketing effort — while Apple was pouring over $100 million into iPod. To light the fire under the agency, Sony also demanded to see “demonstrable results” in three months.

As long as companies are driven more by delusion and hope, iPod’s 75%+ market share is probably safe.

In fact, at this point one could reasonably argue that iPod will spend its entire life unthreatened by real competition. If anything, the category will simply fade as smartphones make standalone devices less necessary.

I suspect it will be a long, long time before another product dominates like iPod has.

(Yeah, I know. iPad now has 90% market share. But let’s meet back in a year on that one.)

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