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How Apple is dealing a blow to physical media

By Dave Geipel

I loved my Zune 30, a music device introduced by Microsoft in 2006. It was a great MP3 player. The first-generation Zune was a 30GB model in black. I loved it so much that I ended up buying one in white the next year for my wife.

After purchasing my Zune, I then proceeded to spend just as much on accessorizing it as I did on the device itself. As we all know, accessories alone ? from gels to screen protectors ? are multi-billion-dollar industries.

From there, the focus shifts to power sources, because, of course, you need a power cord for your computer (USB) and for your car so you do not run out of juice.

Speaking of your car ? where you listen to your tunes ? you will need an adapter for the audio system unless your car has an accessory jack and AUX input, in which case you will need yet another cord.

And finally, you will want to be able to listen to your tunes in your office or around the house. You do not want to be rude and walk around the house jamming to the latest download with your headphones.

However, if you are a teen, then not having a pair of headphone in your ears probably never occurred to you.

Aside from all of these ?additions? that I did not consider prior to my purchase, I could not have been happier with my Zune.

I liked the interface, software and storage it offered, which is appropriate because at the time I was considered a full-fledged PC guy. Until one day, when my Zune took a swim in the reservoir of my coffee pot. It was all downhill from there.

Today, as I type this on my silver Macbook Pro, I should clarify that my ?full conversion? to a Mac Guy began with my iPhone.

Big on Mac
While deciding whether or not to replace my beloved Zune, I was enticed to consider the iPod. I ended up with an iPhone instead, converted to iTunes ?proprietary formats and interface ? and eventually purchased the Macbook. See, I told you it was a slippery slope.

I had fought getting a Mac for years. I use my laptop for more than 12 hours a day, causing me to chew through one a year, regardless of brand or price range.

My experience with the longevity of my iPhone is what ultimately led me to consider the Macbook, and I will never look back.

Call this my brief testimonial for Apple ? a simple story of how one PC Guy became a Mac Guy and a diehard Apple fan.

I attribute 80 percent of my Apple conversion to the iPhone. Without my iPhone, I would still not understand why everyone has become so gaga over Apple.

Now, anything Apple releases, I have to contemplate adding it to my wish list, considering how it will make my work and play easier and more enjoyable. 

Many ask me if I like my iTunes software compared to Zune. The answer is a resounding ?No.?

While Microsoft seems to have every step of the process ironed out and has proved to be successful, iTunes remains difficult for first-timers to navigate through even simple tasks. 

However, once you master iTunes on your computer or iPhone, making a purchase is simple and repeat purchases are even easier with a click of a button.

In my opinion, Apple still needs to fix some snags before iTunes grows into an even larger online marketplace.

So how does Apple continue to grow despite a weak application called iTunes? Simple: sexy devices that you cannot put down and great marketing. They are smooth, slick, and intuitive, impressive to almost everyone. And they are driving commerce.

The iTunes software can only improve, and I have confidence that as it evolves with new downloads and digital content, purchases will increase, as will Apple?s dominance as a retailer. 

Wipeout by iPod
Let us take a look at a brief history on how Apple and the iPod revolutionized digital purchases.

The iPod came on the scene in 2001 and was met with great skepticism regarding Apple and its business model.

By 2009, the skeptics long since silenced, iPod and iTunes sales added more than $12 billion to Apple?s revenue.

What Apple accomplished helped to change the way music is bought and sold.

Remember the days you could go to the mall and buy the latest cassette tape and then CD from a ?record store? such as Coconuts, Strawberries, Planet Music or Tower Records?

And while you can still find a few F.Y.E and Suncoast stores at some malls, I wonder for how long.
With the introduction of the iPhone, physical media has been dealt the final blow and is becoming obsolete. 

Apple developed an empire that created a new segment of the market: highly interactive phones that included touch screens and mobile marketplaces for music, books and applications.

In September 2009, Apple announced that it had sold more than 30 million iPhones. The company saw more than 2 billion application downloads, with 100 million accounts with credit cards and 8.5 billion songs sold. 

Apple currently has 73.8 percent of the music device market, followed by 18 percent held by "other," SanDisk with around 7.2 percent and Microsoft about 1.1 percent share.

Apple has also shown, with its own data, that 50 percent of new iPod sales are to new customers ? those who have not previously owned one ? and the total number of iPods sold is closing in on 225 million units. 

So how does this story about my Zune and iPhone continue as we begin this new decade?

With the launch date of the Apple iPad upon us, the same company that dominates the music device category is looking to do the same with tablet or slate devices. Its digital sales will continue to propel business, even as Amazon and Microsoft (do not count them out ? yet) work to overthrow the Apple empire.

The battle is really not about music, books or movies. For Apple, it is all about interactive commerce.

Connecting on devices
So, what is on the horizon? High-definition investments in each home have significantly driven the bottom line for companies such as Best Buy and Walmart. And it has not escaped the attention of those who deliver content to your home, such as cable companies and even Verizon Wireless with its FiOS service.

Xfinity (Comcast) is working on new technology to further exploit its relationships with subscribers, which is a brilliant subscription model. It is actively working on new ways to provide an even better experience for those people adding new devices to their televisions, ranging from networked Blu-ray players to computers running Windows 7 Media Center equipped with a cable card.

Verizon?s FiOS now sports Facebook and Twitter integrated into their service so you can multi-task and tweet or post a status update. And do not forget leveraging television content through online and device distribution.

A recent DirecTV commercial that showed a bank hold-up with a guy on the floor using his phone to tell his TV to record a show is a great example of the power of mobile access. That is one example of building a ubiquitous network.

What about activating each device the cable subscriber uses in and outside the home from the computer to mobile phone to their new iPad? Now that is bringing it all together. It is quickly moving into the ?cloud? and a device such as the iPad is helping to make that push and thrust for the industry with touch, social connections, location-based, tablet, wireless and commerce.

The battle now is brewing over devices and distribution of all kinds, from advertising to content. And yes, including video ? even your TV will soon reclaim center stage appearances again as it becomes more interactive and connected.

You will see that the new frontier will be centered on connected devices. And who can we count on to be right in the middle of the commerce war? Why Apple, of course.

David Geipel is chief operating officer and founder of QWASI, Philadelphia. Reach him at .