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Switched On: iPod flash wouldn't realize downmarket dreams

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Each week Ross Rubin contributes Switched On, a weekly column about the future of technology, multimedia, and digital entertainment:

The last Switched On discussed how MP3 has been slow to come to many traditional audio products, with many home and car-based offerings from traditional audio companies pricing north of $1,000. Ironically, digital audio, which has been widely heralded as democratizing music, has remained elusively expensive for most consumers, and that assumes that they already have the requisite PC.

Of course, MP3 is not really the villain. It's the storage media. While hard disks offer better price/performance than flash, they still have a minimum price hurdle that currently translates to about $250 for a portable player. This is why there's been so much discussion of the possibility of Apple entering the flash market. There are a few good reasons why Apple should stay away, though.


Entering the flash player market would signify a philosophical �switch� as profound as that of its allegedly chemically enhanced former spokesteen and �really good paper� author Ellen Feiss. Apple designed the iPod around a hard disk to compensate for the limitations of flash. However, Apple has already strayed from its original �all your music all the time� message with the successful iPod mini.

Flash players have also reached higher capacities since the iPod was introduced, but not at prices dramatically below that of the lightest iPods. The large capacity of iPods led Apple to encode iTunes songs at 128 kbps as opposed to the 64 kbps WMA files that at the time were suggested for flash players. You hear less and less these days about the iTunes Music Store as an elaborate marketing vehicle for hardware. If it wants to sell songs, more capacity is better.

Apple could steal flash market share from iRiver and Rio, but do these customers care so much about the iPod brand that they wouldn�t shell out for an iPod mini? Flash players continue to sell well at mass merchants such as Wal-Mart and price clubs, but these stores have never been especially strong for Apple. On the other hand, one of the best things about the iPod for Apple is that it�s given the company a chance to start with a clean slate, as demonstrated by its HP partnership.

One advantage that a flash iPod could have over competing devices is Apple�s proprietary but currently unbranded digital interface port, which has spurred a wide array of unique accessories. An inexpensive flash iPod that included such a port could pave the way for lower-end docking accessories such as alarm clocks, integrated �street-style� headphones, or even shower radios. While the markets for these may be limited for now, they have more mainstream appeal than the watches and sunglasses that already include MP3 players.

Aiwa�s AZ-BS32 �water-resistant speaker�, in fact, used a similar principle, but with a misguided USB flash drive-like device called PAVIT (which in retrospect must have stood for Problematic And Vastly Ignored Technology) that also worked in a portable player. While as underpowered and overpriced as many of the MP3 players previously discussed, it�s a good deal more elegant than the monstrous Sharper Image MP3-CD shower radio. Sales of such accessories would need to be speculative, though, because they probably wouldn�t work with the installed base of hard disk-based iPods.

Like embedded processors, flash memory has a bright future in improving the functionality of everyday devices, but not for holding music libraries, particularly for those trying to build businesses on expanding those digital collections. Music�s future, much like its past, rests on spinning platters.



Ross Rubin is director of industry analysis at NPD Techworld, a division of market research and analysis provider The NPD Group. Views expressed in Switched On, however, are his own. Feedback is welcome at fliptheswitch@gmail.com.
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