Mark Mulligan at Jupiter Research notes that HMV is selling off business in order to refocus on core markets and that this sort of exercise is not going to address the challenges presented by, among other things, online music services. In his web note he asserts:
"there is unwillingness to really take the plunge and heavily integrate their digital offerings into the shop floor. This is largely because the core retail divisions are unwilling to risk further cannibalization of the core business by a low margin digital business that skews towards singles rather than albums."
If this is true (and I have no reason to think otherwise), it indicates a classic disruptive pattern. Not a new observation there. Online music has been disrupting retail for years by providing consumers with a better solution to the job of "I want quick and easy (often impulse) access to a particular song" A host of sub-jobs (ie. I want to improve my mood or get a small burst of energy") are satisfied along with this main job and, as online music retailers become more savvy and provide more and more information about particular songs (think of a wikimusic where samples and be played and songs can be purchased), the liner note job of providing context may be improved upon as well.
We would further suggest that, if Apple et al have achieved critical mass and have gained some knowledge advantage in online retail, it will not be enough for HMV to launch a lookalike service that fights over the same basic jobs to be done currently addressed by online music retailers.
"Hmm," we say "what could HMV do to develop lasting music sales platform without drowning itself?"
We would suggest targeting another job to be done around music while capturing a non-consuming or overshot audience who might value some criteria not currently met by online providers.
Well, what comes to mind? We can start by asking a few questions about consumers who buy music and bands (or soloists) who provide it, namely:
"Who is a current nonconsumer of digital solutions?"
Well, some of the bands themselves come to mind. While many are making MP3s and posting music to MySapce and through other web portals, many lack the means (or the equipment around even the Garageband platform) to record and distribute music. Certainly HMV could play a role by allowing small bands to record new music to MP3s that would be sent around to different stores on the HMV network. Recording prices would need to be far below studio prices and the musicians involved would be giving up access to the best equipment in exchange for instant distribution. This is not a new solution and it has yet to work but I can certainly see either a hive of small recording studios or the musical version of the photobooth. It may be that this concept iterates its way to the karaoke booth. Record yourself, $3 for 3 minutes: send the recording to a friend via email.
Video processing also comes to mind. The base of video clips available under creative commons is growing. Unfortunately, the process of capturing these clips and altering them to make a home music or other video is still out of reach for many consumers. While HMV could not sell the clips themselves, they could sell an assembly service. Come into the store, buy some music, walk out with your own custom DVD. Clips can be watched online and preselected.
[UPDATE: Eh, I have thought about this some more. My gut tells me that this is not such a hot idea] Both this concept and the concept above take baby steps up the music manufacturing process, if only because distribution seems to be addressed by online retail. Of course, the two work together. Here, record yourself, $3 for 3 minutes: send the recording to a friend via email, video clip for $10.
I like both of these just a little bit because they take advantage of a small shift in music, from a song as something that is passively consumed to an item which becomes part of an active conversation.
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Shiny Shiny points to an entirely new watch design from Swatch. Ostensibly it is made for the blind but it could make a great ointerface for the sighted who want to know or feel the passage of time even when their vision is otherwise engaged.
I like thinking that there are always always always opportunities for new design in every basic endeavor. Products like this convince me that it is true.
What other interfaces provide new benefits as they move away from sight? For some folks, cellphones became more helpful when consumers were able to assign different ringtones to different callers. Teenagers are famous for typing and sending text messages while looking away from the screen. Would a fingerprint-sensitive doorbell (different tones for different people) be helpful or too complex? I can often discern the television channel from the noise alone but then I keep the tv on mute because I find the commercials too distracting. Would a product that used commercial detection (not the 30 fast forward solution but actual commercial detection methods) in order to monitor shows and then play a sound when the regular show was back on- a sort of "television timer- be helpful. Would it be more or less helpful than a digital display that simply scrolled the closed captioning lines? The latter may be much easier to develop
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Strange attractor notes that the Economist has closed down a short term Skunkworks project aimed at developing a new web-based channel. Suw Charman leads by focusing on the lack of profits, noting that it would be hard to make money merely by creating:
[A] web service that harnesses the collective intelligence of The Economist Group’s community, enabling them to contribute their skills and knowledge to international and local development organisations...“a community connecting Economist with non-governmental organizations needing help - ‘a Facebook for the Economist Group’s audience.’ ”
The Project Red Stripe page provides a more lengthy summary:
"In a nutshell, non-governmental organisations (NGOs), charities and other organisations - as well as entrepreneurs active in developing countries - will be able to post tasks on Lughenjo asking for help in solving problems. Qualified individuals can then provide such help by donating their knowledge and skills. By connecting these two groups Lughenjo will create a marketplace for good and a new channel for skills and knowledge transfer."I read this description and two questions come to mind:
- If this is a marketplace, what the the NGOs exchanging in return for help?
- If the NGOs are paying consultation fees, would they be better off going with a specialist organization rather than a generalist organization like the Economist?
Profits are important, but I am willing to guess that the project was correctly canceled for reasons of terminal vagueness as well. Like many information initiatives, it suffers from some basic problems:
- It does not address a particular audience ("NGOs" is just too wide)
- It requires that parties along the supply chain generate data without well defined incentives
- It does not differentiate by design between useful data and less useful data (you can't do this until you have a particular audience)
There are, however, some variations of the general marketplace concept which may be interesting:
1. NGOs often have trouble filing for grants. Often good grant applications will have population statistics and impact statements (projections). The economist could help with this, even if it just provided in-house data (of course, this a valuable asset for the Economist and so it may be difficult to let this go for free)
2. NGOs often have trouble thinking through the incentives created by their programs. The economist could help by providing and some basic modeling tools. It is one thing to know in general that demand will drop as price rises, it is another thing to think through this graphically when projecting the impact of a particular program. To go farther, if NGOs are plagued by sloppy thinking, the Economist could provide a framework of questions about any program that will help sharpen the program. It may even be able to support a develop model-get data-refine model approach. It could hire interns to do this. I am thinking of basic supply/demand and marginal cost curves, not anything too complex.
3. The economist may want to start providing NGOs with either of the above two services in exchange for local leads. The information will likely be biased according to the intent of the NGO but leads are valuable anyway.
4. What if the Economist targeted Microlending programs, again providing limited but relevant market data at grossly reduced rates to farmers and small manufacturers who may want to know whether to change crops or shift products. Microlending banks themselves may be willing to subsidize this, since everyone benefits from improved outcomes. If the economist were sure of itself, it may develop a mechanism (notice that word... totally unspecified... I'm being lazy) for splitting the upside of any benefit derived from the data (what? How can you measure the benefit? I don't know. Terrible idea, then...)
So there are a ton of things to do. It may be that the team feared that these activities were too small. I agree with Ms. Charman here.
She quotes from Neil McIntosh on the subject:
...We needn't make innovation hard by insisting the end product is always huge and/or high-profile.
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Treehugger provides a quick picture of a new charging station for electric vehicles:
Ach, what will these look like years from now? Clearly the present design has a few challenges. The tall, lean look (an oversized ipod shuffle) is appealing but they are not going to survive the first lout that decides it looks too much like a target waiting for rugby practice. The manufacturer, Park and Power, also claims that the device will work with all forms of vehicles, from cars to bicycles. Next generation forms may have an integrated bike lock, then.
All products evolve and improve to fit their niche, struggling to maintain easily identified markers (to make it easier for a consumer to identify a product) as they do so. Ten years from now, an urban sidewalk power solution may look nothing like its suburban parking lot counterpart. It may, in fact, look more like the squat metal barrier in the bottom right. Urban planners should think about this. Until the design and the interface is worked out to the benefit of consumers, I'd be tempted to insist in my contracts that all of the solutions be modular, easy to install and remove.
