“A long list of powerful companies have tried and failed to make much of a mark in the world of digital entertainment, where Apple reigns supreme,” Peter Burrows reports for BusinessWeek.
Burrows interviewed Chief Executive Michael Dell by email about Dell’s new plan. Here are some excerpts:
Burrows: To what degree is this initiative about taking on Apple? Can you make a dent in Apple’s share in iPods and iTunes?
Dell: This isn’t about Apple. This is about Dell innovating for our customers.
MacDailyNews Take: Translation: “This is all about Apple. This is about Dell not having iPod+iTunes and losing consumer PC sales to Macs because of it.”
Burrows: I understand you personally championed the purchase of Zing. Is this true? Why?
Dell: Ron Garriques [president for Dell’s Global Consumer Group and former head of the mobile-phone division at Motorola] and team deserve the credit for championing Zing—they are doing a great job evolving our consumer strategy and driving personalized technology and entertainment experiences to consumers. I’m an enthusiastic beta tester and believe Zing could be very exciting for our customers.
MacDailyNews Take: If Ron Garriques does even half the job he did with Motorola, Dell should immediately begin making plans to shut it down and give the money back to the shareholders.
Burrows: I’m told the company plans to bring out hardware devices designed to make use of the Zing technology to buy/play/share this content. How important will such hardware be for the company?
Dell: We’re watching the device space closely. Right now our focus is on testing services that allow consumers to link and share content across many types of devices and through multiple services. Consumers are seeking a service that lets them access whatever source of music or movie content they want on any device. We believe that an alternative to the single device and service model offering available to consumers today would be compelling.
MacDailyNews Take: Translation: “We don’t have an iPod killer because the only true iPod killer is the next-generation iPod. As for Zing, we have allowed ourselves to be deluded once again by outside influences, including failed Moto execs and quote-for-hire charlatans. We’ll blow huge chunks – of cash and other things – on this. Investors should be massing with pitchforks, but since I brought this company into the world, they’ll stand idly by and let me take it out, too.”
Burrows: It seems to me that if the strategy works, Dell could be the primary counterweight to Apple’s closed digital media model. Am I making too much of this?
Dell: I don’t think you are.
MacDailyNews Take: Apple’s digital media model is not “closed.” As for Dell’s response: iCal’ed.
Full article here.
Dell’s revenues are increasing but it’s margins are still shrinking—8.7% in the last quarter. (Apple’s margins are >30%!)
Dell was very innovative in squeezing the supply chain and manufacturing efficiencies. (But now everyone else has figured out how to do the same thing and they are all still completely dependent on MicroSoft.)
As far as innovating in hardware or software, not so much.
I wouldn’t count Dell out of anything. They didn’t beat everyone else in the 90’s because they are dumb. They are just egotistic, arrogant pricks. The culture is one of exploitation, yes men, and obscene work hours. If anything, they have an advantage. They have been knocked on their heels a bit and are now dealing with an environment where they have no expectation of success. Even doing one thing right will bode well in the press. They also have a pretty sick distribution model. They can dump a piece of software on 1 million computers a day. Even at a 1 % adaptation rate, thats a lot of users. They also have a business model that keeps them involved and makes their partners a lot of money, although a bit unhappy. In essence, their business model is similar to today’s social networking/web 2.0 trends, they have just been doing it longer and focus on delivering the hardware rather than the software. Apple really needs to fear them doing it kind of right. Apple could fix iTunes. Let’s be honest, it sucks. Wrapping a web browser with quicktime was OK 5 years ago. But, actually making a software that was user friendly and easier to navigate makes sense now. I’m just sayin, they are kind of complacent on iTunes.
“This is about Dell innovating for our customers.”
“they are doing a great job evolving our consumer strategy and driving personalized technology and entertainment experiences to consumers.”
When Michael makes Ballmer-isms like that, I know Apple has nothing to worry about.
BTW – How exactly does someone interview a person by email?
Shen,
You’re completely right, and I wasn’t fair to Dell. They are indeed skating to where the puck is no longer. It’ll be fun to watch Zing and Zune duke it out…
“They are indeed skating to where the puck is no longer.”
Fooled again by the pagan trickster.
What a way to screw themselves over. MS with its stupid Zune, and now DELL with its stupid Zing. If they call it that, and I hope they do.
Tis true Tommy Boy….I was actually excited and when I held the Zune in my hand I was in awe. Awed that it was thick as a brick, awed that it was shit brown in color. awed at the silly looking buttons and awed that it actually turned on without freezing (I had low expectations).
It is sort of like finding a four leaf clover…but without the associated luck windfall.
Oh…and the wilds I found it in was in New Jersey…
Zing Zune….otherwise known as ZZ Flop. What a bunch of maroons. Yes, we saw subscription music…duh. Now I bet a whole range of devices, disposable, portable (as to the portapotty) that are…wait for it (cue the drum role)….yes SUBSCRIPTION devices. You don’t buy them, you rent them…just like you can do with cars and carpet vacumm cleaners, which by the way will be made by Microsoft, finally a product from MS that won’t suck.
They already made the first mistake with Ron Garriques. Michael Dell thinks he’s somebody special because he oversaw the rollout of the Razr (the creation of which he had very little to do with) and then jumped ship before the boat completely sunk at Motorola. It’s his complacency as the leader of Motorola’s cell phone division that led to the collapse, the belief that he could spend years just tossing out the same Razr with incremental improvements. Couple it with the enabling of his equally lousy former boss Ed Zander and you have the end of Moto as we know it.
I wouldn’t hire Ron Garriques to paint my car. It’s great news for Apple, though, that this loser is in charge.
I dunno. Lets wait and see what happens when Dell executes. Who knows.
Maybe it might not be so bad. I guess we’ll see.
I must admit though, whats up with these silly names? Zing???? You would think they would have tried to distance themselves from the even dumber name of Zune.
I have always loved the fact that people believe that adopting Apple products “lock you in to a closed system” while adopting Microsoft products is this amazing free and open system. In the past I’ve tried to point out people are just as “locked in” to Microsoft as they would be to Apple, but they haven’t been able to see it.
Vista has changed that. Vista has shown that you may have 6,731 PC “manufacturers” but you still have only one Microsoft. Microsoft tells you to move to Vista and you have to do it. Customers don’t want Vista. “Tough shit. Vista is the most advanced operating system we’ve ever made and you are going to like it.” Want to keep shipping systems with XP instead. “Tough shit. We’re discontinuing XP sales in favor of Vista.”
Talk about a closed, locked in system.
Microsoft. Our system is your prison.™
Dell “innovate”? Another oxymoron for the ages.
@Mr. Reeee:
“closed digital media model”?
This is the only way (probably) to make the record industry play along. They hate open, they only care about control and money. Just ask Middlebronfman. He’ll probably want a stake in Dell just to join in, so his boy Lyor can continue to cash out stock options and build his mansion in the Hamptons, while the artists and employees suffer.
Some funny comments here today – made me laugh, thanks guys!
Its impossible to understand how any person with a functioning brain could pick a name like Zing.
It sounds like son of Zune, which is NOT a good thing.
Dell and all the micro$oft concubines have this RDF going where they actually believe that M$hit sold 2 mil. zunes – which they didnt.
They believe that saying stupid things about Apple will help them – it doesnt.
They believe that everyone wants to send shit from device to device – we dont.
They believe that subscription is the only way – it isnt even popular with the few fools who have it.
Dell will be gone/bought out within 5 years.
iCal it for sure.
If Apple bring out a nano phone (which I think is a possibility), the MP3 gamr is over – who will buy an MP3 player when for the same price its also a phone?
Peter Burrows & Michael Dell
Kinda says it all
Michael Dell is an idiot. The music labels are unlikely to license Dell to allow sharing. These days the labels are looking to maximize profits anyway they can and Dell is going to need to give them the farm and shovel their sh*t to get any deal at all.
I know Dell doesn’t like profits but this little venture is likely to end up with Dell doing a freebee. They be better off just donating the money to the labels.
@Predrag “Skating to where the puck will be…”
Apple is hitting the puck. Not only are they hitting the puck, they are defining where the goal is.
Apple’s got the the golden goose and it’s laying golden eggs…
If Dell is incredibly smart they may manage to scoop up a bit of golden goose shit…but that’s about all…
“Apple is hitting the puck. Not only are they hitting the puck, they are defining where the goal is.”
And Dell is waiting out a misconduct penalty while HP is beating the crap out of Acer up against the boards. Microsoft is trying to bribe the ref and Real and Napster are pleasuring each other in the stands with a foam finger and a hard pretzel.
Given this is the same man who’d like to trademark ‘cloud computing’, guess any ideas from outside of Dell looks good.
Someone should tell Michael Dell to clean out his bong once in a while – or change dealers immediately.
@Chuck
“Apple could fix iTunes. Let’s be honest, it sucks”
I will be honest, iTunes is fantastic, nothing else comes close. How much “easier to navigate” do you need? I honestly don’t know what you are talking about.
And if you really think Dell is a threat, I strongly disagree, Dell are box shifters, no more.