Yesterday afternoon, I sat with a few of my colleagues in Amsterdam and we discussed what Apple was going to announce today. I wrote down our guesses and emailed them out to timestamp them.

Cxxxxx: New service that integrates movie rental/download with Front Row. Possible rebranding of iTunes into Showtime. Launch of a new iPod video with touchscreen. Steve Jobs is leaving the company. Lion King & Pearl Harbor on the iPod

Dxxxxx: New iPod with wifi access. Movies on iPod. New DRM.

Michael: Movies on iTunes. Airport for video that uses wifi to move video to near the TV.

I do believe that I made the most correct prediction.

For those so unlucky as to work with me, I have been predicting (ranting some might say) this type of move from Apple as opposed to the computer centric "home theater PC" mindset. The idea to place a fully fledged computer next to your TV. As someone that runs multiple computers in the house and has their media on a server, this is the last thing I want. Heat, sound, cable, and simply a place to put it make the HTPC a bad idea.

Microsoft tried some thing kind of like this with Windows Media Center PC but got caught up in their own rules. If you had a Media Center PC, there were extenders that allowed you do basically do what iTV will do. The problem is that Microsoft made it extremely hard to actually use Media Center Edition. Basically you had to buy a whole new computer to get the software. There are ways to get the software now without a new computer, but it's far from easy.

Apple got two things right that Microsoft got wrong. First, they give away iTunes for free on both Mac and Windows. Microsoft, best case, will sell you the software for $109 for Windows only. Second, Apple had the content people wanted ready to go. Microsoft did not.

Let's compare the score cards:

Apple - Free software for Mac & PC, online media store with music, television, and movies
Windows - $109 software for PC only, online media store with music

If Microsoft really wants to compete when Zune (their supposed iPod killer) is released, they should included the features of Media Center into Windows Media Player and release a Mac version of Windows Media Player and allow Zune, Media Center Extenders, and Xbox 360s to attach to it. That would level the playing field. I doubt that Microsoft will do this since they specialize in doing things only halfway right.

Apple is willing to fulling commit to new ideas and take on the risk of walking away from their existing safety zone. Microsoft has not been willing to do this. The biggest change they have made since releasing XP is to launch the Xbox. They have done a great job, but they seem to lack the will to really go in for the kill and make the Xbox the dominant machine in the home. Their focus on PCs running Windows in the home is keeping them from achieving the larger goal of Microsoft in the home.

This is the key point Apple gets and Microsoft misses.

Look, I like Microsoft and think they have some of the brighest people in the industry. But they really need to take the gloves off and let their product people stretch the limits, even if it changes some of their core focus on selling copies of the OS. The fact that they are walking away from the Mac is silly. They should be embracing the new Mac line with a version of Windows specifically for the Intel Mac. Windows Media Player should be just as available and useful on a Mac as on a PC.

Best case scenario, a media war between Apple and Microsoft for the living room with escalating volleys of neat new technologies. In that case, the consumer wins.

Posted by michael at September 12, 2006 12:14 PM