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CompUSA's Shutdown and a Little Nostalgia
Tweet Share on Facebook December 10, 2007 CommentI feel wistful that CompUSA is going out of business. The shutdown doesn't directly affect me. The company had already closed its stores near us, as it struggled to regain footing in the tough market for retail electronics. And it's easy to see that a shop focused on PCs and PC parts would face fierce competition from all the other retailers now in the market, including office, discount, and electronics big boxes.
But what seems to have killed CompUSA was the Internet. I now do almost all my shopping for PCs and PC parts on the Web. The selection is vast and the prices low. Still, and in a touch of irony that comes too late for CompUSA, online superstar Dell is now moving to retail stores to sell its computers.
CompUSA was still SoftWarehouse, a single store in the Dallas suburbs, when I found it in the mid-1980s. A local PC columnist had written that it was the one store that allowed shoppers to read the manuals for software before buying. The company would open one box of software for perusal. And all the employees must have spent downtime reading the manuals. Their advice helped get me started with PCs. They knew their stuff.
That had changed long before CompUSA's final demise. Clerks there didn't know much more than those at Circuit City or Best Buy do. Now we just hope for a bit of last-minute comparison pricing at the store. We do our research online, which has its advantages. But gabbing at SoftWarehouse was fun.
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Wii-Tracking Sites Hope to Outlast the Fad
Tweet Share on Facebook December 7, 2007 CommentScarcity also means opportunity. Sites that are helping consumers track the elusive Wii game console are taking different tacks to making money, and some, if not all, are in it for the long haul. For example, iTrackr.com plans a major upgrade to its site after the holiday season, says founder John Rizzo.
Rizzo hopes to make iTrackr that missing online link between consumers and brick-and-mortar stores. The site's nine employees have built software "spiders" that crawl the sites of retailers, such as Target and Gamespot, checking inventory for Wiis and other products. "We're basically a search engine," he says.
Once through the busy holiday season, the site will add tools to enable consumers to set up their own groups for sharing info—and to do it all from mobile phones as well. Like so many others, the site hopes to build traffic to eventually make money from advertising. Rizzo figures it can be lucrative, as ads can target consumers who've already said what they're shopping for. Advertisers have lost interest in shotgun advertising, he says: "We offer the sniper approach."
So far, Rizzo has funded the site from family and friends, but he hopes to raise his first venture capital next year. And while Wiis have attracted hordes of traffic, the site already covers iPhones, PlayStations, and other coveted goods that often sell out at stores—and it will add others when opportunities arise. Scarcity, it seems, never goes away. As Beanie Babies and Tamagotchi pets can tell you, it just moves to other products.
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Universal Music Pushes a Subscription Service
Tweet Share on Facebook December 6, 2007 CommentWhile iTunes and its sales model still dominate digital music, the record labels appear to be serious about moving to subscription services. Nokia this week announced that some of its phones will access a new subscription service that will be free for a year and that consumers can download all the music they want. And it appears to be the first example of a new business model pushed by execs at Universal Music, a leading record label.
The music industry hopes subscriptions will prove more profitable than downloads as it adjusts to a digital world. Subscriptions remain just a slice of the money spent on digital music—maybe a fifth of the $1 billion being spent this year getting tunes over the Internet. Most of the subscription share has come from monthly fees paid by consumers to services like Rhapsody.
In the deal with Nokia, Universal Music is apparently getting a hefty fee upfront, which presumably will be reflected in the cost of the phones. Consumers in turn get all-you-can-eat music. That's the approach advocated by Universal execs in talks with other record labels. And from comments coming from other music studios, you can expect some of them to sign on with Nokia.
Users can even keep the music they've downloaded on their Nokia phones or PCs. But it can't be loaded onto other music players, at least not yet. Under Universal's plan, the makers of those music players would first need to pay a fee to the labels.
Apple CEO Steve Jobs has so far resisted the music industry's pressure to start a subscriptionlike service for iTunes, preferring to allow consumers to pick and choose which songs they want to buy. But Universal's pitch may catch on with other music players trying to find a new way to compete with iPods. If it does, it'll be interesting to see if Apple eventually dances to the labels' new tune.
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Apple TV and Others Have an Identity Crisis
Tweet Share on Facebook December 3, 2007 CommentApple TV isn't alone in struggling to find a market. The computerlike box is designed to link the living room TV to PCs and even the Internet. It's a field where many have gone and many have failed. A big part of the problem is home networking, particularly wireless. It's too hard to get machines talking together.
But just as difficult is the message. Consumers don't understand what these boxes do. For that matter, there are many kinds with different functions. Some, for example, like the Apple TV, have hard drives that hold entertainment locally. Others operate without a hard drive, streaming songs and videos from a PC.
And nobody can even agree on what to call them. A popular choice is "digital media adapter," says Joyce Putscher, an analyst who tracks home networking for In-Stat. "Digital media" refers to the files, and "adapter" suggests the translation between the digital world of PCs and the analog world of a TV's pictures and sound.
Maybe. Still seems too techie a term for me. But perhaps it isn't as bad as calling a consumer product a "home server."
