Mac Greer interviews tech guru Bob Cringely, employee No. 12 at Apple, for The Motley Fool. A few choice snippets from Cringely:
Apple will stop making iPods the day that they can make more profit from an iPod license than they can make from selling an iPod. And that day will come. A switch will flip, and suddenly you will be able to buy an iPod from anyone, and Apple will just be in the iTunes business, but they will be making money from Apple IPE [intellectual property enforcement] and iPod licenses.
I think Microsoft is not stupid. Microsoft is big and lumbering and brutal, but they are not stupid, and what they know is that they have more resources than anyone, and they are fully capable of doing some little Zuney thing that is relatively meaningless except that every potential competitor has to take it into account. So Microsoft spends $500 million developing the Zune. Five hundred million is nothing to them, and they spend that much marketing it, which again, is nothing to them. And Apple and Samsung and all the other guys have to respond to it. In the meantime, what is Microsoft’s real strategy? Microsoft’s real strategy in the home has to be built around Xbox, and Xbox is actually doing some smart things, so I view Zune as a deliberate distraction; it is a decoy.
Full interview here.
Never confuse stupidity or the lack thereof with ineptitude, hubris, and mismanagement. With Zune, Microsoft is simply reinforcing their reputation for making mediocre products. Regardless of the amount, that’s not money well spent.