http://www.apcmag.com/apc/v3.nsf/dir/ipodvideo

Saturday, 22 October, 2005

APC Magazine’s Dan Warne reckons Apple is about to deftly round-house kick Microsoft’s media center strategy for six. First Apple leaves a mysterious header on the Mac Mini motherboard for a non-existent iPod dock connector. Then it brings out media center software and a video iPod at the same time. Then it recruits the head of TV recording company ElGato. When you put the pieces together, it ain’t pretty for Microsoft.

Apple’s a shrewd operator. First, its spreads misinformation from the top - like how Steve Jobs famously slagged off media centre PCs in a conference call with financial analysts last year. “We might as well make it a toaster too,” he said. “I want it to brown my bagels when I’m listening to my music,” he said at the time. “And we’re toying with refrigeration, too.”

“We’re not going to go that direction,” Jobs concluded. “There is a small audience that likes this.”

Yet only a year later, he has released the video iPod, along with the ability to download good TV programs from its iTunes Music Store.

Apple has simultaneously released an upgrade to its iMac G5 to give it media centre capabilities. This model of Mac can’t record or watch TV, so it’s a half baked media centre solution, howl the critics, and fair enough too.

But what if the industry’s presumptions about the future of ’converged’ computing is fundamentally wrong. It’s not certain people really want to record and watch TV on a boxy home computer… even if it can connect to a loungeroom A/V setup.

It’s also questionable whether everyone wants to stuff around with streaming video over their network (complete with glitches and dropouts).

What if, in fact, they’d rather just have a tiny computer that works as reliably and simply as the average DVD player?

Well, that computer isn’t an iMac G5 … so let’s assume that’s Apple’s first foray into media centres, with the aim of selling it as a big, high-margin ‘flatscreen LCD TV’ initially. Let’s assume Apple has something else in the works.

Now consider that hardware enthusiasts who took apart the original Mac Mini noticed there was an unused header on the motherboard for an iPod dock connector. At the time they speculated that during prototyping, Apple had made a Mac mini with a dock connector built in, and an engineer had carelessly forgotten to remove the header from the motherboard design.

Finally, consider that one of the best TV recording solutions on the market is from a German company called ElGato. Their software makes it easy to record TV (even glitch-free high definition) and burn it to DVD with no stuffing around.

The CEO of that company, Freddie Geier, has just been made Managing Director of Apple Germany. Starting to get the picture?

Now imagine: a tiny, silent Mac Mini with an inbuilt iPod dock connector, an inbuilt DVD recorder, and a video iPod which could automatically synchronise with the TV programs automatically recorded on your Mac Mini the night before.

And for people who don’t watch that much free to air TV, but like watching TV episodes on DVD, Apple has a solution there too… programs are available for affordable on-demand download, that could be mirrored locally on Australian servers for fast download.

It’s about the perfect media centre concept … exactly what Microsoft promised and hasn’t delivered at all.

With Microsoft, we get chunky ’portable’ players that can’t fit in your pocket and cost around $1,000. Media Centre PCs are often ugly variants on desktop PCs, complete with noisy fans. Windows MCE doesn’t make it easy to burn TV to a DVD that can be played on a normal DVD player. The whole package is based on Windows XP, so you still have to deal with virus and spyware issues. And the downloadable content in the “spotlight” section of Media Centre is little more than an afterthought – mostly boring niche-interest video clips.

Windows Media Centre is typical of a technology company’s solution, whereas Apple is now fairly and squarely positioning itself as a content company (Steve Jobs likes to say, “let’s never forget, it’s all about the music”) which happens to have cool technology to go with it.

If you’re still sceptical, consider that in Apple’s last financial results, sales of Macs actually jumped 48 per cent year-on-year. “The iPod halo effect is real,” says Marcus Annett, iPod Product Manager in Australia. “Before, it was all a bit anecdotal, but these figures actually show how dramatic the effect has been.”

To me it’s obvious: Apple’s about to do to the media center PC market what it did to the portable music player market. It doesn’t mean people will switch to Macs as their primary home PC, but Apple is going to sell a truckload of Mac Minis along the way anyway as under-the-TV media-centre boxes. The next phase of its long term strategy isn’t too hard to imagine, and it will be to do with replacing home PCs (with the assurance that you can always run Windows on an Intel-based Mac if you need to.)

Love him or hate him, Steve Jobs is damned clever at assembling the pieces on his chess board without people noticing until it’s too late