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Is Apple Going to Become a Media Company?

A lot has been written about Apple lately. The new iTunes service is a hit. The iPod has become the killer gadget for MP3 enthusiasts. A lot of people are again touting the rebirth of Apple as a cool company. Apple has always been cool. But all of these product announcements make me question whether Apple has long-term aspirations about remaining a player in the desktop computing world.

What first piqued my interest in this topic was the evidently spurious rumor that Apple was planning to buy Universal. The debate around the merger really highlighed something, however; Apple has increasingly become much more about digital media and less about desktop computing. Let’s examine four of Apple’s most successful product announcements of late, where success is defined by consumer praise and unit sales:

OS X – The latest Apple OS release won rave reviews from Apple and Unix enthusiasts alike. The operating system has done well in terms of unit volumes and is generally praised for being incredibly stable and familiar for those with a background in Unix.

iMovie – I don’t own or deal with much in the way of digital video, but those who I know who do deal with lots of digital video swear by iMovie. From what I have heard, it is one of the most popular digital video editing programs on the market and has driven more than a few people I know to make “the switch” to Apple platforms.

iPod – The iPod has done such a phenomenal job in reinvigorating the moribund MP3 player market that I don’t see much reason to go into detail about its role in the category or its impact on the marketplace.

iTunes – Like the iPod, iTunes is making people question whether their assumptions about whether consumers will or won’t buy music online. I believe that iTunes will be successful for Apple because they understand the consumer services business better than most large companies.

So, when I look at these product annoucements it tells me one thing — Apple is very good at doing consumer media entertainment products and services. Not only are they good at doing it, they are better than a lot of other companies who have built large franchises in that very market. It looks to me like Jobs & company are betting Apple’s near term future on dominating consumer digital media. With the rise of digital consumer content and home networking, it looks to me like Apple is sitting in a very good position.

As an aside, Apple’s success in the consumer media space makes me question why Apple wants to be in the computer hardware business in the first place. The Apple computer products will always have a cult following with Mac enthusiasts and anti-Microsoft folks.

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