Personal Digital Media – From Uniqueness to Ubiquity

Posted in Marketing & Strategy Articles, Total Reads: 2667 , Published on 10 December 2013

In the year 2001, a certain Apple Inc. had an epiphany. It realized that in the market for personal digital devices there were well established products in categories such as digital cameras, camcorders etc. but the portable music player market was flooded with devices that were either huge and clunky or minuscule and inoperable with interfaces that were simply a nightmare to navigate. That’s when the idea to create a more user-friendly digital music player was born and Apple designed the iPod, a device that revolutionized the industry and became Apple’s flagship product for many years.

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With its minimalist design, sophisticated looks and ease of use, the iPod was totally unlike anything anybody had ever seen before and it took the world completely by storm. Even though it was more expensive than most of the other products already in the market, it just offered so much more that the customer base didn’t mind. So successful was the iPod that it completely hijacked the digital music player market with over 70% of the devices sold being iPods and in approximately 11 years after its launch it had sold over 350 million units. [1] It has played a key role in launching Apple to the pinnacle it is at today and although it has lost out in revenue contribution to newer products like the iPhone or iPad, it continues to be the world’s largest selling and most easily recognizable music player.

Figure 1: IPod sales figure from 2004-2011

Source: Wikipedia

Fast forward to present day and there is another technological revolution that is slowly but surely making its presence felt in people’s homes. In the world of digital set-top boxes and direct streaming from internet services like Netflix, industry giants like Apple and Microsoft are all queuing up for a slice of the pie. Microsoft devices like Xbox have built-in apps for popular services like Netflix; Apple has launched Apple TV that seamlessly links all Apple products to your TV and allows you to watch any kind of digital content on it. It was obvious that the other behemoth, Google, would not stand idly by. Google has come up with its own little device to take on the competition: the Chromecast. For the uninitiated, the Chromecast is a tiny little device, like a Bluetooth dongle, that connects to your TV and syncs video or other digital content from services like Netflix or Youtube from your PC, Mac or mobile device or from the Chrome browser on your computer directly to your TV. Once you have configured the Chromecast to your TV (and it’s almost as simple as just plugging it in), all you have to do is pick up the closest device, search the show you want to watch and press play and it will start streaming to your TV. So awesome is the Chromecast that not only can it automatically select the right input for your TV, it may even be able to turn on the TV for you. It may sound like something from a sci-fi horror novel but it’s not. It does however feel like a couch potato’s dream.

All that however, isn’t why the Chromecast is expected to have its competitors eating dust. In fact, as far as features go, it still lags behind most of them. Where it does score highly is the price. At the moment Chromecast retails for $35 in USA, as opposed to nearly $100 dollars for Apple TV. And while Apple TV pre-dominantly works better with other Apple devices, the Chromecast will work with pretty much every device as long as it supports a native app or the Chrome browser, making it so much more flexible and widely useable.

So how does Google manage to profit from such a low price? Actually, it doesn’t. Google is targeting a profit-free low price model with the Chromecast which obviously leads to questions about why? An excellent article in Slate magazine hazarded a guess. What Google is aiming for here is ubiquity. Just by lowering the price so that the product is easily affordable, Google expects to ship huge numbers of the device. As the device becomes increasingly popular, more companies and platforms start supporting it. A short time later, the hardware (in this case the dongle) disappears as TV manufacturers start integrating the protocol directly into their devices. As a result, every TV becomes a Google TV! [2] It almost sounds like a plan hatched by an evil scientist: simple, brilliant and determined to take over the world.

Google knows that it doesn’t have to worry about generating revenue from the Chromecast immediately. Its target is to make the device all-pervasive. Ubiquity is what will improve the Chromecast. And once this ubiquity makes it the de-facto standard of streaming digital content to TV, Google will have enough sources to earn revenue.

What these two contrasting examples do is demonstrate a paradigm shift in the market for technology. Where once a unique product was the primary requirement to become successful, today the same may not necessarily hold true. In an increasingly fragmented market, where multiple alternatives to a product are easily available, it becomes more important than ever to have a larger user base.

However, there is still a very thin line that demarcates success between the two. Microsoft was on top because their goal was to put a PC in every home and once they did that they remained top dog for a very long period. And for all the flak they’ve received about failing to innovate their products, they aren’t going away anytime soon. In contrast, in the audio equipment section, companies like Bang & Olufsen and Audio Technica are still more active in the niche audiophile segment than the mass market segments populated by brands such as Skullcandy and Dr. Dre, and are doing well.

Interestingly, what people don’t generally know about the iPod is that it wasn’t always the roaring success it is considered today. The reason behind that was that the iPod initially had a Mac-only compatibility. And even after that the device came with only firewire cables that most PCs did not support. Apple had to make the device compatible with PCs and provide standard USB cables for connectivity for the iPod to really take off.

Another scenario that makes for interesting reading is the smartphone market which once used to be Apple’s stronghold (again we must remember that Apple took over the market from the erstwhile leader, Blackberry). The iPhone, which is still considered by many experts to be the best phone available especially in terms of build quality, has lost ground to Google’s Android OS based phones which are being churned out at a rapid pace by pretty much every mobile device manufacturer under the sun. The fact that Android remains an open-source platform, allowing any manufacturer or even an individual user to customize it to their preferences is one of the most important contributors to its growth. And like it’s predicted for the Chromecast, it is ubiquity that has improved the Android especially with Google taking valuable inputs from all the bright and crazy tinkerers that like to fiddle with their OS.

Table 1: Analysis of Smartphone Market share by Operating System in Q2’12 and Q2’11

Source: Techcrunch.

Thus, ubiquity is not just about mass market production and launching new models every week. Ubiquity is garnering expertise by following and absorbing the existing best, and then going beyond it to become the best. Uniqueness may promise the status of an icon, but it can also create the illusion of permanence. Neither grants you the guarantee of success, but ubiquity does give you a little more leeway, a buffer to fall back upon. And in the crazily competitive world of today, where economies are as fickle as consumer preference, everybody needs a little leeway.

This article has been authored by Nadeem Raj from XLRI, Jamshedpur


[1]: Wikipedia.

[2]: Slate Magazine.


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