Apple vs. Sony: Will Wireless Win?
By John Alderman, Wed Apr 21 20:00:00 GMT 2004

Sony is aching to take back the throne of Portable Music King from Apple. With tech and music divisions finally working together, could wireless be the next piece of the puzzle?

The New York Times has an interesting article about Jay Samit, the new chief of Sony Connect, a division created to rival Apple’s success building a hub of next-generation music buying. While the story did a nice job of explaining the dilemma, it didn’t mention wireless, a weakness that might be used—by Sony or somone else—to bypass Apple’s PC-centric approach.

Samit, formerly of EMI, was seen there as someone who understood the evolving new world of music, from both practical and visionary standpoints. His move to Sony is intended to bring about dialogue - and the coordinated action - between its technology and entertainment sides. Because Sony has big stakes in both technology and content (Sony Music is one of the top major labels) it has been reluctant to take the risks necessary to move forward, while Apple, unburdened by music ownership, shot ahead.

The competition between Sony and Apple make for hot verbal shots between the two, particularly as Sony tries to market the MiniDisc player in America.

"We're not about one-size-fits-all," Samit says, "You can't believe it's about just one brick that people will carry," he said, referring to the iPod.

"We have a very healthy respect for Sony," says Apple CEO Steve Jobs. "But Sony believes very strongly in the MiniDisc, and we don't. It might work in Japan but not here."

Both are right. The MiniDisc hasn't done anything in the States—once accustomed to players like iPod that don’t require removable disks, few are likely to return. But neither is Apple’s controlling stance likely to withstand a maturing market unchanged.

Apple’s strategy is about making money by selling hardware, with its sexy music store written off as part of the cost of doing business. This vision features the personal computer as the center of that galaxy, the hub and management center for all entertainment. Sony, with a much more diverse product line, is not so tied to that. The unmentioned wireless side of the story is potentially huge.

If Sony—or another company—can build a wireless delivery system that bypasses the ties to PCs, say, by hosting the music management system and providing assured access to your music, wherever you may be, that system could leapfrog Apple as Apple has done to Sony. Never having to worry about replacing a scratched CD sounds good now, and in a few years, as iTunes music buyers have changed jobs, and switched computers, not worrying about replacing the music files they forgot to de-authorize will sound just as compelling.

As the newness of digital music wears off and consumer knowledge about the choices and conveniences of different services grow, the company that can address wireless access, and deliver a more permanent hold on the music consumers have bought, will have a strong advantage.