Entries Tagged 'Businesses that Suck' ↓

I finally, despite hating AT&T and resenting the crap out of Apple, had decided to pick up a 64GB 3g iPad yesterday to get in on the remaining opportunity to the unlimited 3g plan.

I went to the Apple store on 59th St, and upon spotting an employee blue shirt in the tumultuous sea of humanity, asked, “Where do I go when I know what I want?” — in itself an indicator of a failure of sorts for Apple, I’m sure, but not one cool enough to fix. Of course, in true don’t-let-the-customer-help-himself,-manage-his-experience Apple fashion, it depends what you want. Also in true Apple fashion, “We don’t have it, no other stores on this island have it, probably, and the best I can do for you is give you the phone numbers, so you can call them yourself.” No thanks, guys, I have your phone, and the experience using it for the same is far better than the experience you’re giving me in-person.

Here was me, owner of several iPods, an iPhone, an AppleTV, and a Mac Mini trying to buy the highest-priced item in a product line on a whim, and nobody can tell me even semi-definitively IF I CAN BUY IT TODAY?

Steve: If you insist on controlling the experience, you’ve got to get it right. You have to find a way to recognize that the savvy customer doesn’t want the velvet rope. If I’m ready to pay the premium price, and you can save the “concierge” service for those who need it, let me just find out where I can simply buy a SKU and thereby increase your margins.

Random off-the-wall conspiracy prediction: Sprint 4G iPad soon. Sprint could really use the juice, and would be willing to commit a lot to accelerate 4G roll-out, including an iPad-specific unlimited plan which would explicitly allow tethering. Sprint needs some kind of major play to become relevant, the Pre didn’t do it, and the Evo’s ultimately doomed by battery life — we can’t afford to have our phone batteries die because we had to use an access point for a while.

I was just thinking about what back room wrangling may have gone on to have the iPad contract-free 3G service through AT&T happen.

Obviously, as a book reader, Apple could offer the Kindle up for comparison, and Steve could certainly make the case that ubiquitous connectivity would have to be better than that offered by the Kindle to make his device transcendent. He could get people to pay for that transcendence — it was going to be a premium experience, so people would pay for it. But people hate cell phone companies, and contracts in particular… so it had to be easy to enable and disable, with the option to bump up your plan if you’re running over, without the possibility that you’d get a $5000 bill from AT&T because you left a video stream going.

Steve had a few things to offer up. First, he’d go along with the whole mini-SIM thing to appease AT&T. People couldn’t use their iPhone SIM in their iPad, so they’d have to get the additional service. They’re not going to get rid of their iPhones — you can’t carry the iPad everywhere. Average revenue per Apple fanboi would go up, and with the simplified pricing plans and self-service provisioning, the cost of servicing the additional load is just a technical problem, something that can be solved by using money.

So Steve might have said, “OK, we’ll tell Verizon to screw off, make it so people can’t just use the one subscription for iPhone and iPad, and increase your ARPU. You give us a self-serve no-hassle unlimited-use option and another at a lower price for those who aren’t yet sure how much they’ll love our magical boogie board. And this iPhone 4? It’s gonna be awesome, too, and bring even more folks into the iPhone fold. It’s going to do Skype, so invest in the data side, and you can even drop your spending on the voice side. You do this for us, and we’re going to make you THE carrier of mobile data. Buy the towers, buy the routers, run the fiber — just be ready.”

It seems logical to me to have gone that way. Even if the details are off a bit, we can’t know.

One of the most troubling things about exclusivity agreements is that we know so little about them.

When does an exclusivity agreement between market leaders turn into anticompetitive collusion? Isn’t the team of Apple and AT&T almost its own vertically-integrated market monolith?

Additionally, the terms of such agreements are obviously incredibly material to the financial health of both companies, and investors are prevented from accurately gauging corporate prospects without access to that data.

It would seem to me that disclosure of such terms should be required to be disclosed publicly, with well-defined regulation around what can be redacted, and what the allowed reporting delay can be after contract execution.

I’ll admit that I’d be happy to see the side effect of increased competition when the light is shined into dark corners. I’d love to see service providers competing on the price and value of their service, rather than relying on exclusivity agreements and paying kickbacks. They should be competing for my business, not Apple’s.

In watching the fight unfold between Cablevision and Disney/ABC, it’s plain to see that the largest problem the cable companies have is their adherence to their business model and not picking the right core competency.

Time Warner Cable is asking its customers to support their fight against content providers:

I’ve recently upgraded my home internet connection to Time Warner Cable’s “Wideband” Internet Service — using DOCSIS 3.0, I get 50Mbps down, 5Mbps up. And I actually get it. Since I’ve posted before about the negative experiences I had with Time Warner’s RoadRunner service at a previous apartment, I’ll update it with some information about how one individual turned around my customer experience and gives me some measure of hope.

In either case, I’ve tried streaming various HD video services, and while I’m fairly impressed as to how far full-screen HD video has come, it’s still not where it needs to be – full-screen on my 24″ LCD the video can resolve to fine detail, but has horribly visible problems with lots of motion. Whether Hulu, TNT, or the Olympics, there were issues, though I found the way the Olympics’ Silverlight video streams seemed to “resolve” to detail very well after motion slowed, and it appeared to in some ways mimic the eye varying focus organically. The Olympics player also didn’t full-screen the video, it full-screened the player, which maintained a photo-like frame with advertising.

In any event, in investigating the bitrates used by all three services, I found that it never exceeded 3.5Mbps, probably due to the tactical problems with distributing significantly higher bitrates over the internet.

Why isn’t Time Warner Cable reading the writing on the wall and recognizing itself for what it is?

The “television” cable company is a content distribution network.

They’ve figured out how to give me a 50/5 last-mile connection. Downloads from content distributed by CDNs is reasonably close to rated speed.

Time Warner should be focusing on making it easy for content providers to get higher bandwidth streaming content hosted (if on-demand) or replicated (if live streams) into their network, from which they could easily pass it along to me at 10 or 15Mbps, resulting in significantly higher quality video.

They could either charge content providers (like ABC/Disney) for their content distribution services which enable an unsurpassed customer experience (possibly even charged at variable rates subject to SLA as monitored by end-user equipment), charge customers to access this premium experience (charge one rate for internet access with “wish you the best” experience, and an additional fee for access to this premium CDN), or a mix of the two.

I’ve got an LG BD570 on the way, which is a Blu-Ray player which supports streaming of Netflix, VUDU, CinemaNow, Youtube, Pandora, and media from my home network over DLNA. It hasn’t been delivered yet, but I’m well on my way to being my own CDN. If they’d provide a highly-accessible CDN, and access to it through a set-top box open to whatever applications whether they use the CDN or not, they could offer a hell of an experience. And they could extend the CDN into my house using one of my set top boxes as a CDN node of sorts.

Did Comcast GetIt(tm) with its rebranding as xfinity? Might that be where they’re heading?

Cablevision’s Optimum Online services have always been a cut above the internet offerings from Comcast and Time Warner. Maybe they can “get it”, give in for now, and then change their business model to be someone whose services are actually in demand, wanted by both the content providers and end users. Rather than being a proxy for licensing battles, they can step out of the way of the content providers’ licensing models, offering infrastructure that seamlessly handles a feature set that supports the licensing models of choice of the content providers, and allow users to handle the battle over licensing.

Get out of being in the middle of the problem, and get into the middle of the solution. There’s something wonderfully empowering in the business model being focused specifically on the level of service provided — it ties business success with customer experience, a wonderful feedback loop.

Wouldn’t it be nice to want to do business with the cable company?

Were they also to establish an open licensing authorization platform, they could provide content providers a platform to authorize access to content based upon the licensor’s business model, and provide sublicensing to content aggregators targeting specific verticals. They’d sell services to content providers (licensors), curators (aggregators based upon value-add with a sublicensing business model), as well as to end users (aggregation of licensing into packages or a la carte bundles for retail sale).

If you make the rights management reasonable, CableCompany, you can open your own iTunes-like content licensing store on this platform. You can get revenue from transaction fees on the sublicensing, and be transparent about it. You’d be a “cloud service”, and could bill based upon usage, and drive usage through an exemplary customer experience.

Or you can wait, and die off when someone else does this. Look out for FiOS and Google. Verizon’s got everything to gain about getting high ARPU internet services rolled out, and don’t have the same legacy mindset about content licensing that you do. And Google’s gigabit-to-the-home is probably actually just an attempt to wake you up to get you to do this for their benefit as well.

Be the open and transparent good guys and innovate to the future, or be the hated bad guys and become irrelevant. Your choice.