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Whither the iPod?

It’s been quite an autumn for the iPod: the fifth anniversary celebration, the ultra-small gigabyte Shuffle and finally the ultimate iPod accessory: “The Perfect Thing,” Steven Levy’s engaging new book that chronicles all-things iPod.  But here's the big question: what comes the iPod?
Apple Launches New iPod In Seoul
Apple's ubiquitous iPod, including the latest video version, shown here, is a digital media phenomenon. But issues like digital rights management could stem that tide. Chung Sung-jun / Getty Images file

It’s been quite an autumn for the iPod: the fifth anniversary celebration, the ultra-small gigabyte Shuffle, the iTunes Latino store and finally the ultimate iPod accessory: “The Perfect Thing,” Steven Levy’s engaging new book that chronicles all-things iPod. “Perfect Thing” (Simon & Schuster) is the ideal Christmas gift for the iPod lover who already owns every skin, case, dock and dongle on the market; Levy, Newsweek’s technology editor, has written an unabashed and highly readable tribute to the device and its impact on media and society.  Covering everything, that is, except for one fascinating question: what comes after the iPod?

At one point in Levy’s book, Steve Jobs uses the phrase “plate tectonic shift” as an adjective, and while grammatically unorthodox, he’s right on target.  The impact of the iPod on media has been astonishing — and not only on the music world.  Just last week an NBC executive admitted that unexpected sales of episodes through iTunes was a factor in renewing “The Office” series for next year.  Five years ago who could have predicted that a handheld digital media player would be able to shift the fortunes of primetime network programming?

Five years from now, however, the iPod ecology must grow beyond the handheld realm and inhabit the larger context in which we consume media; what the industry generically calls “the living room.”  But there are some major issues to confront between now and then, many of them growing out of the key element that made the iPod successful in the first place: Apple’s iron-fisted control of hardware, software and content sales. 

One of the reasons that the recording and film industries were initially so comfortable with Apple as their digital standard-bearer was that walled ecosystem, which lessens the opportunities for piracy.  But traditionally, consumers mix and match their audio and video components; they play a CD on Sony equipment at home but then pop it into a Pioneer deck in the car.  But at present, digital rights management (DRM) systems are incompatible. The song you buy on iTunes won’t play on a digital music player from Samsung.

Incompatible DRM is thus a big problem, unless you assume that Apple will take over the entire consumer electronics market (a prospect that the Sonys and the Samsungs of the world aren’t likely to allow).  In an interview with Levy, I asked about the road ahead. “In a few years,” he said, “DRM interoperability will probably happen.  It’s in everybody’s interests, including the record labels.”  He points out that it may even become a legal issue, as in the French effort to make iTunes songs playable on competitors’ devices. 

The DRM issue may ultimately influence who succeeds in the consumer electronics world.  Until recently, I would have given Microsoft an edge in this area: its engineers understand how to write code that will play on many different devices. Indeed, they flaunted this ability in the name of their DRM, PlaysForSure.  But now Microsoft has taken a page from the Apple playbook by launching the Zune media player and its own music store—whose songs will be incompatible with PlaysForSure.  At the moment it looks as if we’re actually moving farther from a universal DRM solution.

(MSNBC is a joint Microsoft - NBC Universal venture.)

Another big issue for Apple watchers is where conventional television—over the air, cable, satellite—fits into the company’s media strategy.  Microsoft’s Media Center software has given plain old television careful attention, and after several iterations actually offers an impressive DVR function.  Apple, while it experimented briefly with television functionality in 1993, has apparently left it out of iTV, the video streaming device it will launch in 2007 as its first placemarker in the battle for the living room. 

When I asked him about this, Levy offered a good point: “You could make the argument,” he said, “that the conventional television world is on the way out.”  He suggested that it would make more sense for an Apple living-room product to provide access to Google’s YouTube than, say, the Fox network (and of course, Google CEO Eric Schmidt recently joined the Apple board.)

Even so, while most network executives would agree that conventional television is under pressure, it’s a bit early to predict its collapse.  Steve Jobs has previously overestimated the demise of technologies, most famously when he introduced his NeXT computer in 1990 without a floppy drive.  He was right that floppy drives were obsolete; he was just ten or fifteen years too early.  That may also be the case with the question of how long conventional television will continue to dominate the living room. 

But Jobs is also capable of changing his mind: he was adamant that no one would want to watch video on the tiny iPod screen right up to the point where he decided they would.  (Although “Perfect Thing” makes it clear that Jobs is still not overly impressed by video on a 2.5” LCD.)  Perhaps some accommodation to conventional television remains in the future; last year, for example, a flurry of Silicon Valley rumors predicted an Apple-Tivo deal that never materialized. 

A final vexing issue lurks in the iPod future: users have grown accustomed to hearing CD-quality and DVD surround sound on their living room systems.  Will compressed iPod files sound a bit thin by comparison?  Levy thinks that for some people it won’t make a difference, but for others there may be a “semi-orphaning of the tracks you’ve already bought.  But in another few years Moore’s Law will mean more storage, increased bit-rates and higher quality.”  It might also mean, however, that the recording industry gets to play its favorite game: selling new versions of songs you already own.

But what about the future of the iPod itself?  We’ve all, of course, heard the iPhone rumors. Levy’s no help there—he says that Apple keeps him as much in the dark about future plans as anyone else. It was interesting to hear, however, that Levy recently visited Apple headquarters in Cupertino to give a speech about the iPod.  Afterward the developers asked him what he’d like to see in future versions.  Levy’s answer was that he wanted even more ability to share playlists and preferences among iPod owners. “The whole future of music discovery,” he says, “will be based on sharing and preferences.”  That’s one place the Microsoft Zune, with its built-in Wi-Fi networking ability, may have a short-term advantage—although likely not for long, if Apple has the sense to listen to advice from the most visible iPod fan on the planet.