How To Compete with the iPod

Perhaps some of you caught the news recently and learned that Rio has finally been pronounced dead. Yes, they join Virgin Electronics in the “I got killed by the iPod craze and all I got was this lousy T-shirt” fan club. (a club Creative will be joining soon I have a feeling) And that news started me thinking along the lines of just what it would take to compete effectively against the iPod and its associated technology.

At first glance it appears that only one of two things would have to happen to give competitors a shot at any real market share in the near future, and they are:

1. Apple makes a huge mistake somewhere and its competitors are smart enough (and positioned correctly) to take advantage of their blunder.
2. The market experiences a fundamental shift and other companies create a new product that takes advantage of this different paradigm.

But those aren’t necessarily the only options. In fact, here is my suggestion for all of your failing MP3 player makers. Ready for it? Here goes:

Target the auto industry

You must concede the fact that Apple, with 70% of the market, effectively owns that turf. So, try to cut a deal with Ford or GM or Toyota to install a cheap, easy to use, MP3 player in all of their new cars. Do that and over night you have a huge install base. Now, here is the key, you can’t get too fancy. Your mantra should be simplicity. In fact, here is what I would like to see in an auto-MP3 player:

First off, it has to be the same size as the current crop of CD players. In fact, you want people to look at your product and realize that they could spend $150 for a new CD player or $100 for a new MP3 car mounted player. Hopefully they will pick your product instead of sticking with CDs. Now, this new auto-MP3 player has to be completely self contained. Meaning you shouldn’t need a computer to make it work. You need to be able to feed CDs into it, let it automatically rip them to its hard drive, and then spit them back out for you. Basic sorting options need to be included along with a simple play list creator. Remember, you aren’t building an iPod wedged into a dashboard you are making a new, different product.

In the newer, more expensive cars you can go a little more crazy. Say for instance in the new Acuras that have the navigation system that appears on a small screen built into the dash. That could easily be modified to accept another input from, say, an MP3 player. So now you can create playlist easier, manage your files better and in general have a nicer experience. Once you have the auto industry set then you can move onto challenging the iPod directly. Would it work? Don’t know, but anything is better that going the way of the Dodo. So, in my opinion, that is your best shot for competing with the iPod. Good luck.

Now, before I am drowned in a hail of hate mail let me refine my position by saying the following. First, I am not advocating that a company build a device like this I am merely trying to point out that this would be a unique way to compete with the iPod and thus keep your company in business. Second, I am well aware of the FM transmitters that you can buy for the iPods but, quite frankly, I don’t like them. They are a kludgey solution to a problem that deserves a better answer. Eventually a better answer will be found, it just remains to be seen who will bring it into the mainstream, Apple or someone else.