Want to Beat the iPhone? First Beat the iPod.

iPod killers have come and gone, and come and gone, and come and well, lingered on like an unwanted wart. iPod killing is an old game and no one seems interested in displacing the thing anymore, now all attention has turned to creating an iPhone killer. This seems odd, the iPod is still growing but apparently it is much more interesting to focus on creating an iPhone killer than an iPod killer. Or perhaps the industry has thrown their collective hands in the air and said "You win this one Apple, but we'll be back!" If that is the case, one hopes they twirl their mustaches while saying it.

The strategies will be the usual make an iPhone knockoff with more iPhone in it. The iPhone surfs the web at 1.4 Mbps? Our iKnockoff surfs the web 4.2 Mbps! Your iPhone has 16 GB of storage? Ours has 32! Yeah, keep trying to out spec the iPhone fellas, that is going to work just as well as it did when you tried to make iPods that were more iPod than the iPod.

Forget about the iPhone, the next company who wants to control the media space (and really, who doesn't want to control the media space?) needs to focus on the software first, then the player and forget about the money because if you get the first two right the last one will take care of its self.

One of the buzzwords tossed around a few years back was vertical integration, the idea that any company that wanted to beat the iPod would have to control the entire experience. Microsoft fell for Steve's trap when he said that to beat the iPod Microsoft would have to control the whole widget.  And why not? Steve Jobs was saying it and that guy knows a lot. Microsoft excreted the Zune. Undoubtedly, it was a difficult process because of the Zune's squarish corners but Microsoft managed it. What they ended up with was a serviceable music player held back by software, odd color choices and a public who collectively wanted the Zune about as badly as they wanted permanently flaring hemorrhoids (there were exceptions).

What is the key to beating the iPod? Forgetting about the stupid iPod and focusing on software. If any company should know this it ahould have been Microsoft. After all Bill Gates once demanded that he wanted a Mac on the PC. That directive came to pass (you can call it Windows) and won, for now, the computing wars. What Bill knew, and forgot, was that it wasn't the Macs nine inch screen or keyboard that made the Mac great it was the software inside. You don't spend a whole bunch of time marveling over how cool the machine looks, you spend a whole bunch of time using it. To beat the hardware you first have to beat the software.

At this point the general inclination is to quit. No company can beat the iTunes/iPod combo so no one will ever beat the iPod. Not so fast, someone can win the "acquire new content battle." This is the battle companies actually want to win. Apple, Microsoft and the RIAA don't make a freakin penny off the CDs you ripped into the computer but controlling (one way or another) how you acquire new content is huge. This is where someone smart will start the war.

With an iPod or an iPhone you've got a few ways to get your music and videos. iTunes is always at your beck and call but the movies are limited. Amazon will sell you DRM free songs and Wal-Mart will sell you DRM laden stuff and undercut Apple's price. Finally, you can go the route of P2P and just bag the content from another user. But try to make the choice in iTunes and you're basically screwed. Apple serves up one way to buy your music and movies and that is off Steve Jobs' hard drive.

Someone savvy will come along and build a program with a nice interface that gives you options for the source for your downloads. Wal Mart, Amazon and DRM free iTunes songs would be sourced along with P2P sources. Users could choose where to get the song/movie of their choice from. You want David Hasslehoff sings the hits? No problem, you could get it from a German P2P site, iTunes or Amazon. Though a careful programmer would alert me to the fact that you're supporting David Hasselhoff's singing career and I would immediately come over and give you a liver punch.

Once you have the complete iPod killer, killing the iPhone i just a few chips away. But you're under some time pressure if you want to off the iPhone. Every software iteration that comes out makes the iPhone more independent of the computer and every day that passes is one day closer to Apple's and AT&T's contract ending.

If you do it quickly enough, you can truly create an iPod/iPhone killer. And once you do that you can cover yourself in honey, roll around in hundred dollar bills and then take a bath in a tub filled with Krystal. But don't, because that would just make you seem weird.