GenDigital

Product Watch: Flip Video

Talk about a perfect storm of opportunities...User generated content is hot, video sharing is super hot and mobile social networking has, in our humble opinion, infinite growth possibilities. Sounds like a product marketer's dream for a type of device that can harness the phenomena. Well, here is something to check out that has some potential and some big time financial backers. The new device called Flip Video, is a hand held mobile video camcorder, about the size of a pack of cigarettes, (smoking is down over the past year among the youth market by the way, but that's not what we're talking about here) is positioning itself as the first device with full video editing capabilities that can easily upload content to the popular video sharing sites like YouTube. The value behind the device besides its size, is the fact that consumers can upload their work directly to the sites skipping the step of taking the content from device to computer and then upload to the sites. Will skipping a step make a big difference? We'll see, but I have to say, this device seems very promising at first glance and perhaps more importantly, cost won't be an obstacle. The device will be sold at a wide variety of retailers ranging from Target to Best Buy and will cost between $119 and $149.

Technology Dominates Toy Fair Convention

As this year's American International Toy Fair gets underway today, visitors to the the annual convention will quickly notice a recurring theme: marketing high technology infused items at young, sometimes very young (like 2 and under) children. Toy manufacturers are bringing things like laptops and tablets as well as digital cameras, staples for the adult market and creating versions just for young children. According to an article in Wired, consumer electronics targeted at kids is the fastest growing segment within the $20+ billion toy industry. Toy makers cite the trend growing based on the lower costs of electronic components, and of course, the incredible savvy of the youngest generation as it relates to technology and media comprehension.

Microsoft's Zune Has Ultra Strategic Partner in Universal

Only a day after receiving strong reviews from some noted technology critics, Microsoft has made a bold announcement. The wanna be iPod killer just might have set a precedent by setting forth a revenue share agreement with Universal Music, the world's largest music company and home to acts including omnipresent U2 and rap impresario Jay-Z. Under the terms of the revenue share, Universal will receive more than $1 from every Zune player sold. Not exactly gigantic, but as Jeff Spicoli would say to Mr. Hand, "righteous bucks." Of course there is another story behind the story with this whole thing. Rumor has it that Microsoft was having some trouble negotiating with the music companies and clearly they had the leverage given the fact the Zune player comes to market next week, so timing was clearly of the essence for the folks from Redmond. The newspaper reporters who wrote about the Universal/Microsoft announcement all ponder if the precedent will lead to Apple making similar announcements. I say no way, since Apple has the all the power. You control the market for portable media players (upwards of 90% for teens and college students), you lead the negotiations. At the end of the day, Microsoft is bringing an alternative product into a one product category. Is that what they did when they introduced the Xbox?

Microsoft's Zune Gets Rave Reviews

Does Microsoft finally have an answer for Apple's category leading killer iPod and corresponding iTunes downloading service? According to recent a recent report, the soon to be unveiled Zune is in fact, the real deal and represents the first real legitimate challenge to Apple. The $249 portable digital media player's value positioning revolves around social interaction. The Microsoft product managers quoted in the report attempt to provide "real world" examples of the Wi-Fi capabilities of the player. They call the Wi-Fi capability the "social sharing of music." Certainly the Wi-Fi capability is something not currently offered by Apple, but the question remains, is this enough to encourage young people to purchase Zune instead. I don't know, but we're going to find out soon when we begin fielding our Holiday Gift Wish List report in less than two weeks.

Newest iPod Sure To Get Some Repeat Customers

"Oh, it's so cute," is probably a quote you'll hear from some 18 year old female if you're around an Apple store tomorrow when the newly re-designed iPod Shuffle goes on sale. The latest iteration of the Shuffle is pretty impressive. How the about the size? The aluminum player is half the size of the original (which was already pretty tiny), which makes it that much more perfect for the teen and young adult headed for the gym or a work out. How about the price? Even with the improvements in size, Apple still cut the retail price by twenty bucks to $79. That's less than a typical college students spends over a long weekend. We believe the new Shuffle will appeal mostly to existing iPod customers (which is now essentially half of the college audience and a third of the teen audience) that are pleasantly happy with their current device, but looking for something easy and "cheap" for work outs. Should be another good financial quarter for Apple.

SanDisk's Sansa Is Cool But Won't Make Waves

Not since the days of the Walkman in the 80s has a consumer electronics device had such a broad impact on youth lifestyle. Of course, I am referring to the iPod for today's generation of techno savvy tweens, teeens and young adults. Although there has been a few competitors to step up and offer alternative devices (and downloading services) none to date have really made a dent in the market. Nationally, I believe, but don't quote me on it, that iPods have about a 75% share of the portable digital music player market. Among tweens, teens and college students that number is even higher at 88%. So, if you were a device maker or corresponding downloading service, you'd better come up with something pretty compelling, right? Well, I don't believe that is even the case anymore. With what I would consider to be rave reviews, the SanDisk Sansa is out on the market but even with its great capabilities compared to its cost (it actually does a few things an iPod cannot) it hasn't (and probably never will) caught on with the youth market. Why, simply put, it could be the greatest thing next to slice bread, but it doesn't have an Apple logo on it. Apple's overall perception among the youth market right now puts it right up there with perennial leader Nike and the maker of the Razr, Motorola. Compare that to five or so years ago before the iPod craze...Apple wasn't even on the list. The takeaway: no matter how great a competitive offering might be, the perception always comes back to the market, and based on the current environment, no one will be swaying their perceptions anytime soon.

Samsung Releases New MP3 Player

Samsung has released a new 4GB $249 MP3 player called the YP-K5 that received a decent review from Business Week. Borrowing a few characteristics and brand equity of the market leading iPod, the YP-K5 seems to have some pretty cool features and the packaging and accessories to go along with it, but I highly doubt it will be able to take any tangible share away from Apple since it doesn't have a USB port or Mac compatibility. Note to Samsung, for starters, you might want to try and come up with a cooler sounding name instead of YP-K5.

Sony Unveils E-Book Reader

After a couple of hiccups, yesterday Sony finally unveiled its new e-book reader device to the media. The initial reviews that have come out so far have been extremely positive. You might wonder why we're even covering this topic. Well, there is somewhat of a paradigm shift taking place in the secondary school and collegiate textbook market. One of the biggest complaints received from college administrators (only because they hear it non stop from students and their parents) is the cost of textbooks, which we estimate is a $2.5 billion business just among college students. More colleges and high schools are looking for alternatives and the given the state of digital technology and Gen Y's extreme comfort factor, alternatives like e-books seem to make some sense. With the release of their new e-book reader yesterday, Sony has set itself up to quickly become a market leader in a category that should grow by at least 20% this year and next year. The big challenge will not come from the school administrators or students in our opinion, it will come from the book publishers themselves, who by some accounts, have been slow to embrace e-book technology as an additional distribution platform for their textbook offerings.

A Coming Out Party For Microsoft's Zune

Yesterday was a coming out party of sorts for Microsoft's new portable digital music player called the Zune. Some of the details still remain sketchy like the actual release date (other than knowing it will be out before the holidays, but technically that could be December 20th) and the expected retail price (MSFT confirmed pricing for Zune) would be competitive with the iPod). But really, the interesting news coming out of Redmond yesterday was the wireless sharing capabilities of the Zune player. Essentially, users will be able to wirelessly deliver songs to other users also using a Zune player. You figure if you're going up against an 800 lb. gorilla who has a 75% share of the full market and a 90% share of the Gen Y market, you better come out with something extremely cool and it better be of substantial value. Now, I wonder if this sharing capability is just that thing that could propel MSFT and Zune to capture a share of purchasers this holiday season.

Apple Makes Bold Move Into Consumer Electronics Market

Ten years from now, technology writers and historians might reference Steve Jobs as the leader of the first company that transformed itself from a computer maker into a digital entertainment company. Yesterday's much anticipated speech from Mr. Jobs had tech market pundits and analysts guessing what would be his now trademarked "last thing" to talk about. As it turns out, Mr. Jobs and Apple plan to introduce a new device that will marry the family Mac to the family television. The new product, called iTV, is not due out until early next year, so they will miss the 4th quarter holiday shopping season. The $299 device which is about the size of a small book, plugs into the television and wirelessly pulls in content from the family Mac. Given the rich entertainment value proposition of the new Macs, expect Apple to emphasize the transfer of music, video and other images for all to enjoy on the family's 42 inch plasma.