What if Apple understood customer service?

Late last year, I had a conversation with a long-time owner of Apple computers. I'm a short-time owner of Apple computers (from 2001). The two of us concluded that Apple continues to succeed in spite of itself. Apple owners are loyal and fiercely protective. They evangelize for Apple and the company repays them with shabby treatment.

"Can you imagine how well Apple would be doing," the long-time owner of Apple computers wrote to me, "if only Apple would treat its customers well!" What an interesting thought. A case can be made that few high-tech hardware or software companies treat their customers well, but Apple seems to be particularly likely to do what seems best for the company in the short term without regard for long-term results and with little regard for the customer.

Example 1

Apple released OS X a bit too early. OS X version 10.0 was a decent proof of the concept that a graphical user interface could be overlaid on Unix, but it wasn't really ready for people to use. To Apple's credit, it made OS X version 10.1 available to users at no additional charge. But when version 10.2 came along, Apple demanded another $100+ from their users. I've waffled a bit on this, but it seems to me that Apple's long-term prospects would have been better served if the company had made this upgrade free.

Apple is – first and foremost – a hardware company that happens to make an operating system. The more people Apple can convince to use its operating system, the more hardware they will sell because OS X runs only on Apple computers.

Apple is now debt-free and profitable, but when OS X 10.3 came along, the company wanted still another $100+ from its loyal customers. I wonder what people would have thought if Microsoft (which is primarily a software company) had decided to charge $50 or $100 for each of the two XP service packs. Nearly every software company I know provided updates an no additional charge for the life of the major version number.

In other words, if I buy Bamboozle 3.1 and the company later releases Bamboozle 3.2, Bamboozle 3.3, and Bamboozle 3.3.1, each of those updates should be something I can download for no extra charge. When the company develops Bamboozle 4.0, I would expect to pay for the upgrade (not the full price of the new product, but a discounted "upgrade" price for the latest version.) Apple has effectively changed the rules for itself by charging customers for step upgrades.

Example 2

Apple isn't alone here, but I'd expect better from a company that tries to position itself as the company that does things the right way: The company ships computers with far too little memory.

If I buy a cheap computer from Wal-Mart, I would expect it to skimp on memory, disk drive, video card, and all other components. A cheap computer is a cheap computer. Apple computers are not cheap, although they are more reasonable than they used to be because Apple is now using fewer proprietary parts. Many of the components used in Apple computers are exactly the same as those found in Windows computers.

Yet if you go to the Apple store and price a new Powerbook (G4 1.33GHz, $1600) you'll find that it comes with just 256MB of RAM. That's enough to run the operating system, but even basic users should have at least double that amount of RAM. Those who want to use the computer for intense graphics or other hungry applications will need 4 times (or 8 times) that much memory. But Powerbooks have just one memory slot.

Users have a choice: Pay Apple to upgrade the memory and pay a huge premium for Apple memory or throw away the memory that came with the computer and upgrade it yourself with memory from Kingston or Crucial. If Apple wants to keep the price down, why not just sell a computer with NO memory and let the user buy it elsewhere?

Even Apple's most powerful G4 Powerbook (G4 1.5GHz, $2800) comes with just 512MB of RAM. (See screen capture at right)

For comparison, I dropped by Toshiba's website to examine low-end and high-end machines. Toshiba provides only 256MB of RAM with its Celeron-based Satellite A60 (2.66GHz) but this is a $700 computer. No, I didn't leave a leading 1 off the price. This computer sells for $300 less than $1000. Toshiba's P35 Satellite (3.33GHz, $2000) comes with 512MB of RAM – the same that Apple provided for its high-end model, but the Toshiba costs $800 less. (See screen capture at left)

Apple will tell me that "speed doesn't matter" and that the G4 processor at 1.5GHz is the equivalent of a 3.33GHz Pentium processor. The G4 has certain advantages over the Intel Pentium 4, but not enough to make up for that kind of difference in raw processing power.

I priced additional memory for the Powerbook listed here. Apple will sell you a 512MB memory module for $300 or a 1GB memory module for $700. By comparison, Crucial has memory that will work equally well and the price is a bit less: Less than $100 for a 512MB memory module and less than $500 for a 1GB module. When I bought a G4 Powerbook, I got it with the least possible memory from Apple, gutted the machine and bought memory from Crucial.

Example 3

Apple's Ipod is a wonderful device, but it's also responsible for several Apple annoyances. First, there's the battery. It's wimpy and even a new Ipod doesn't have enough battery power for a transcontinental flight, assuming you'll be stuck in airports along the way for at least a few hours. The battery will give out before you get to your destination.

Apple could have made the Ipod slightly larger and used a bigger battery.

Apple also could have made the battery something a user could change. Batteries do eventually die, even the rechargeable ones. At first, Apple wanted more than $200 just to change the battery. After enough complaints from buyers, and some threats of legal action, Apple finally reduced the price for a battery to $95.

How magnanimous of them.

But now there is competition in the marketplace and it's clear that Steve Jobs hasn't learned the lesson Bill Gates tried to teach him back in the 1980s. Gates wanted to license parts of Apple's operating system. Jobs refused. Gates and company developed Windows and nearly put Apple out of business.

Fast forward to now. If you buy music from the Apple store, you get a file that has digital rights management (DRM) encoded. As a result, Apple's DRM files play only on "authorized" computers and only on Ipods.* You can't use WinAmp to play an Apple DRM file. Once again it appears that Jobs and Apple are taking an outstanding idea and, by trying to keep everything to themselves, will end up losing it all.

Real Media tried to license Apple's technology. Apple refused. Real has now developed a player that can play Apple's DRM files. Apple's response: Threats of legal action.

Jobs is a smart guy, about that there's no question in anyone's mind, but he does seem to have a large blind spot that nearly killed the company one time. How many chances will Apple get?

"So if you're so smart, why aren't you running Apple?"

That seems to be Apple's usual response to criticism. Some folks just don't want to hear views that differ in any way from their own. That's how companies get into trouble. Surround yourself with people who always say, "Sure, Steve, that sounds like the best idea we've heard since your last big idea." If someone cares enough to think about your company and offer an honest criticism, it might be wise to give the comments at least some fleeting notice.

*If you want to play one of Apple's DRM files (the extension is m4p) in another player, all you need do is play the file in Itunes, capture the analog audio stream, save the file in whatever format you prefer, and then play it with your preferred player. This is a real-time process, so it will waste your time. But you'll then be able to use music you've licensed the way you'd like to use it. There are doubtless other ways to accomplish this task using "cracking" software that you can find on the Internet.

It's (going to be) a digital world

I recently had a chat with an acquaintance who lives in Silicon Valley and has been working for the past decade and a half with the companies that invented CDs and DVDs. In recent months, he's attended 3 market research conferences and the recent National Association of Broadcasters conference. I asked him to do a brain dump to give us some idea where digital imaging is going.

The first thing he did was pull me aside and whisper that he had a word he wanted to say to me. A bit theatrical, I thought, but the word was "Digital."

I should be thankful it wasn't "plastics" or "rosebud".

He then went on to say that Intel, Cisco, Dell, HP, Sony, Panasonic and others are predicting that your home will soon be fully networked with a central PC that holds, manages and distributes all your content to friends and family. For some people, this is already a reality.

In this digital future, you'll shoot digital video on the weekend, have your personal video recorder (PVR) save your favorite shows, store the video, and then serve it up on demand.

You'll watch the shows you missed (skipping the ads) or listen to and of the 10,000 music tracks stored on the central computer.

IDC, a global market intelligence and advisory firm that specializes in telecommunications and computer industry intelligence predicts some big changes in the next few years:

What do you have in your home today? Maybe several PCs of various vintages. If you've read this far, it probably means that you're technologically a bit (or a lot) ahead of the general population. You probably have a home network and it might be running on fiber instead of CAT5. You may already be sharing data and printers on that home network, and maybe some audio.

My source cited another IDC study that surprised me. Photography has been an essential part of my life since about 1963 and I declared the age of digital photography to have arrived around 2002 after buying my first digital camera in about 2000, but IDC says that more than half of the population have not yet gone digital.

IDC says 54% of us have no video camera, no digital camera. But look at the other half of the chart. That story is interesting, too.
If you own a digital still camera or a video camera of any sort, there's a good chance that you own more than one device. While 13% of the population have a digital still camera, 10% have that and an analog video camera, another 3% have digital still and a digital video cameras, and 6% have all 3 kinds of cameras. About 20% own more than one electronic imaging device, so the good news for the manufacturers is that one sale seems to lead to more sales.

If you buy a cell phone today, there's a good chance it will have a still camera built it and it may do video, too. The quality won't be good, but it's adequate for a quick snap. In Japan if a cell phone doesn’t have a camera on it, it can’t be sold. We’re just starting on that cycle.

Digital camera people are staying up late at night trying to figure out how they can beat this movement but the cam-phone is an impulse image device. That means the people who should be worried about their livelihood are the one-use disposable camera firms. You always have your cell phone with you so when you want a shot, you got it.

But if you want more than just a chance grab shot, what's in the phone isn't adequate now and won't be for a long time (if it ever is). If you want a high-quality image, you need a standard digital camera. Phone cameras just can't do it.

If you have it all, where do you put it?

In 2004, all together we shot about 95 billion images. It is estimated that in 2007 we will shoot about 210 billion images. That’s a lot of data cards, CDs, and DVDs.

The numbers have gotten so huge for camcorder video we’re already measuring the volumes of captured video in years. This year camcorder users will capture an estimated 40,500 years of video. In 2007 we will capture an estimated 68,000 years of video.

And the latest thing for video is direct recording to mini-DVD discs. Most of the people I know are already buying CDs on spindles. Increasingly, that's how people are buying DVDs, too.

And disk drives in computers are now in the 100GB+ range for many buyers. You may have a computer that has more than one disk drive and you may be willing to spend a little extra for high-speed SCSI drives or the near-SCSI-speed SATA drives.

Your home network still wears sneakers

Because real home networks still require either a lot of time and patience or a certified network installer (or both) a home network for most people will still be a "sneaker net". You make a CD or DVD on one device and carry it to another device for playback. A home data center isn't yet a reality.

Yet.

And at today's prices, home video central seems a bit distant. A number of these products make an appearance at the broadcast trade show, but the inexpensive ones are $5,000. If you want more features, you'll easily drop $30,000. These are designed to manage content in huge digital libraries that hold 2-10 terabytes of content for $20,000.

But wait -- Pioneer has a "small" digital library. It holds 300 DVDs, costs about $1000, and needs a $50 piece of software. You’ll be able to find the specific disc in a minute or less and almost instantly go to the images or video segment you want.

Burning up

The super-fast 8x DVD burners that hit the shelves a few months ago are now being sold at fire-sale prices. BenQ and Plextor introduced 12x burners, but these were trumped by 16x units from LiteOn, NEC, BTC and AOpen. Drives are ahead of the media, though. The 8x media is only now becoming widely available at reasonable prices. You'll pay a huge premium for 12x or 16x discs. If you can find them.

Pioneer, HP, and Sony are still selling every 8x dual burner they can make and will be transitioning to 16x dual burners when media becomes available. The delay is a result of the usual problem: Specifications. It's important for everyone to be on the same page so that media recorded in one device will play back on another. The hardware can be made faster with relative ease. What's harder is getting the media right.

Double-layer DVDs arive, but ...

Sony, HP, and Philips have started shipping double-layer (8.5GB) burners that also write single-layer (4.7GB) discs. Pioneer is about to join the crowd and the prices aren't much higher for these new drives than for those that burn single layers.

Media is becoming available and the cost for a dual-layer disc is about double that of a single-layer disc. We'll have shortages for a while because only a couple of firms have the expertise in producing the media. They will be licensing the technology but the front-end investment is not insignificant. So most of the media manufacturers simply wait until there is a huge demand for the higher capacity media. When? Sometime in 2005.

Moving files from here to there

An acquaintance said that he was looking for "software/cable that will make info transfer between laptop and PC happen quickly and easily."

I'm presuming Windows PC and replying to the list because this is something that most people deal with occasionally.

Easiest: If both machines have a network card, buy a special "reversed" CAT5 cable and connect the machines. You'll need to give them each a static IP address and create shares (just share the root directory, or root directories if you have more than one drive). The cable will cost just a few dollars.

If both machines have Firewire or USB, and both are at least Windows 2000, you can set up a network that uses those connections. The cable will cost just a few dollars.

If one machine has a USB connector but no parallel printer port and the other has a parallel printer port but no USB connector (a not uncommon situation) Keyspan has a $30 solution.

If all the machines have in common is a parallel port, then you'll want a special parallel cable from Laplink, along with their software for $50 or so.

Nerdly News

The BIG blue screen of death

Imagine this: You're standing on stage at the Consumer Electronics Show, delivering the keynote address, and talking about how in the future video will be delivered to the entertainment center from a home computer.

Then imagine this: The "blue screen of death" appears on the gigantic screen behind you and your presentation grinds to a halt.

An finally, imagine this: Your name is Bill Gates.

That wasn't all. A slide show froze up, too.

Microsoft offers spyware protection

Microsoft is moving quickly to get into the anti-spyware business. Last month, the company bought Giant Company Software and on Thursday released a beta version of an anti-spyware application based on Giant's application. Microsoft is also looking at a subscription service to keep the applications up to date.

Most users, if they take the time to install protective software, must buy and install a firewall application, an anti-virus program, and an anti-spyware application. Each of these must be maintained separately, so there is significant value in finding a way to solve the problem at the operating system level.

Visit Microsoft's anti-spyware website.

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