Last week, Motorola launched what is probably one of the first hundred phones to have a built in music player... but the first associated with Apple's iTunes. In The Observer, John Naughton blames its underwhelming reception on Apple protecting its iPod franchise:
The real significance of the iPhone is the way it illustrates why companies find it hard to innovate. The difficulty stems from a simple, unpalatable fact - namely that radical innovation generally threatens your existing business model. Or, in MBA-speak, it cannibalises your core business.
The iPhone is considerably less than the sum of its parts for one reason: it was designed by a company that has become a prisoner of its previous success at innovation.
Apple's lucrative discovery and exploitation of online music transformed its image and its corporate prospects. But the assets it acquired in the process are now so valuable it would be corporate madness to do anything that might undermine them. And yet that is precisely what radical innovation would achieve. So Apple cannot do it.
Comment: Odd that John Naughton apparently thinks iTunes was the first legal music download service, considering that Peter Gabriel founded OD2 in 1999. My possibly flaky memory suggests that Listen.com, Pressplay and MusicNet were also out before iTunes....
