Converging Tech and Entertainment

If anyone can do it, it is Steve Jobs. Apple is launching an online music service soon, and there are reports that is planning to buy Vivendi Universal. SJ Mercury News writes:

Jobs has tried to strike a balance between the entertainment industry’s protectionist stance toward music, and the attitude of some in the tech industry that consumers should be able to do what they please with their music files. When Jobs introduced Apple’s top-selling iPod music player in October 2001, he cautioned that entertainment industry efforts to lock digital content were doomed to fail — but he also gave reviewers a bag full of store-bought CDs to test the device. It was a statement that Apple does not condone music piracy.

Still, why can Jobs waltz into Tinseltown and do deals others can’t? He has good references — among them Woody the cowboy and Sully the monster, characters that Jobs’ Pixar Animation Studios has created for blockbuster movies “Toy Story” and “Monsters, Inc.” Pixar has a track record of four successful animated films at a time when animated efforts from traditional powerhouses like Disney have failed. That means other entertainment executives are more willing to buy into his next idea.

“Steve has engineered one of the most successful ventures in profitability in filmmaking over the past decade or two through the team he built at Pixar,” said Jeffrey Logsdon, entertainment industry analyst at Gerard Klauer Mattison. “He’s probably one of the most envied guys in Hollywood.”

Shrikant Patil provides the wider perspective:

Steve believes the only way out is the implementation of new business models which enable easy downloading of music, with any song at any time type of concept. The existing publishers are frozen to death because they worry cannibalization of their existing business, which seems to be more inevitable with every passing day. The best way to move forward is to buy one these frozen ducks and unleash their potential in the form of new services, the world has never experienced before. Apple has always demonstrated innnovation in their products and the first mover in many areas, always setting trends but always commercially limited by their volume economics and channel reach. With a music service on the internet they will be able to reach all parts of the globe, there is no part of the world that does not listen to music. If this service becomes a must have by consumers, more people will upgrade to broadband, store more music on their PCs and leave home with a iPOD type device.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.