In a NYTimes rant headlined How the iPod Ran Circles Around the Walkman (http://www.nytimes.com/2005/03/13/business/worldbusiness/13digi.html?ex=1268456400&en=3da69bc08858ad56&ei=5088&partner=rssnyt), historian Randall Stross analyzes how Sony, the electronics giant that more or less created the modern portable music market with the successful Walkman cassette-tape player in the 1970s, failed to prepare for the digital audio player.

Sony introduced several new Walkman MP3 players this week, causing Apple's share to down more than 7%. Nevertheless, it remains to be seen if Apple has anything to worry. According to Phil Leigh, analyst with Inside Digital Media, "if these new entrants come in and accelerate the growth of the market, there will be no adverse consequence to Apple, even if its market share slips." Leigh forecasts 100% growth rates up to the next four years in digital music sales and in digital music players. Apple commands between 60 per cent and 70 per cent of the digital music player market, having sold about 10 million iPods to date. Piper Jaffray forecasts Apple will sell nearly 22 million iPods in 2005, and about 27 million in 2006.

Maybe Sony will never learn it: it is not all about features, but also about style. And Apple owns when it comes to style.

It seems like Sony tries to build their success on the innovations of others, so creating a new paradigm isn't their forte but building a better mousetrap is. I think it's apparent because instead of trying to figure out what people really want, they'll just bombard the market and hope something sticks.

I think that Apple has created a brand in the iPod that people respect and admire, and that all of these other digital music players are playing catch-up in feature-set and name recognition. Sony has made a major concession in moving away from their proprietary ATRAC music format and that may help them in moving their products, but even if they chew into the iPod's dominance, I don't think it'll be by much because Apple will just incorporate any new features that pull love away from the iPod.

Sony, the marketing company that happens to make electronics.
POL9A