iPad and the Sixth Deadly Sin

Undoubtedly, the hottest – and most critically analyzed – announcement of the last week has been Apple’s release of the iPad. I will take a slightly different perspective on it, looking at it from the perspective of the iPod. We will do this from two angles: marketing and long-term strategy

First, from the marketing perspective, I believe this device’s name is awful. Jokes abound on the Internet within a day of the release – and having spent almost a decade on Wall Street, I suspect it took less time than the fastest trade-processing system for the jokes to hit the trading floors – about whether it is an Internet device or a 21st century sanitary napkin. Apple has been very successful with its iMac, hugely successful with its iPod, and beyond all expectations with its iPhone. However, there is a concept of brand overuse, and there are appropriate extensions and inappropriate ones. Anyone with half life experience should have seen the associations coming; this is especially true for a master of marketing like Steve Jobs. It was always hip to walk around with an iPod – “oh, cool iPod” – and an iPhone, but most people tend to keep discussions of their bodily functions outside of the hip and cool space. “Is that an iPad?” “(blush) Oh, no, just a tablet computer” is not a good sequence for generating demand. Microsoft ran afoul of this in a minor sense with its Zune. Zune sounds very close to the Israeli Hebrew slang word for intercourse. The irony is that an enormous percentage of Microsoft’s R&D is performed in the major Microsoft R&D Center in Herzliya Pituach, Israel. This should have raised a red flag. Nonetheless, Microsoft either didn’t notice, or decided that a 7MM person market is not worth the trouble of changing the name. In any case, Zune has hardly been a smashing success, for reasons that make its crude-sounding name a minor element.

In the issues of larger long-term strategy, I believe Apple may be suffering from a mixture of envy, technical limitations and confusion.

  1. Envy: Apple owns and dominates the digital music market. By selling an MP3 player that was easy to use, hip and cool, Apple placed itself precisely where it needed to be to become the prime retailer of music, upending the decades-old music distribution system. For all that Amazon and Wal-Mart have done in this space, as well as other minor players, Apple deserves full credit for finding the way to disrupt the music market using the Internet; kudos to Steve & Co. However, in the book market, an existing retailer, Amazon.com, managed to successfully sell an eReader with an attached store, essentially grabbing a page straight out of Apple’s playbook. Further, with Amazon’s existing relationships with publishers, they became the perfect channel for it. Amazon is no technical upstart in the book distribution business; they are a dominant player in the business, and they moved into digital distribution by using Apple’s model. I believe Steve Jobs saw Jeff Bezos do this and went green with envy.
  2. Technical Limitations: The Kindle is limited in many ways: it cannot do video, general documents, really surf the Web, work in many other countries, etc. However, at buying and reading books, the Kindle is superb. In the old Unix systems administration world, the software design philosophy was to do one thing, and do it extremely well. In that respect, the Kindle follows this philosophy. Buying books is easy; battery life with wireless on is now up to a week; the pages are crisp and clear, thanks to eInk technology. The iPad, on the other hand, uses colour and audio, with multiple wireless connections, which makes for a great multimedia environment, but tires the eyes and has a limited battery life of 10 hours. Granted, this is much better than most laptops or even the iPhone, but it is pathetic for long-term use. Most people are willing to curl up with a good book or two on the beach for days, but to have to go charge it? Definitely not.
  3. Confusion: Apple seems to recognize its limitations, and thus seems to position the device midway between a reading revolution and a laptop revolution. In politics, this is called triangulation; in marketing, we call it confusion. If you go to Apple’s iPad page, the title is “the best way to experience the web, email and photos.”

With all of that, there is no question that the iPad (I cannot even write the name without wondering if StayFree is going to sue them or partner with them) is a very cool device. However, Apple has gotten quite confused and possibly envious. After a great run of iMac, MacBook, iPod and iPhone, I am concerned they are about to flop.

About Avi Deitcher

Avi Deitcher is a technology business consultant who lives to dramatically improve fast-moving and fast-growing companies. He writes regularly on this blog, and can be reached via Facebook, Twitter and avi@atomicinc.com.
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