Digital Home Thoughts: iPod firmware and Apple's edge

"Last week I suggested that the iPod Hi-Fi represented a turning point in iPod accessories—one where Apple indicated its willingness to compete with its partners. What I failed to mention is that there’s more to it than Apple simply releasing an elegant boombox that competes with similar devices from the likes of JBL, Bose, Klipsch, and a host of others. That “more” is Apple’s ability to establish an edge by adding unique capabilities to its iPod products via the iPod’s firmware. When Steve Jobs introduced the iPod Hi-Fi, he demonstrated that a Speakers menu would appear when you plugged the iPod into the Hi-Fi. As pointed out by Dan Frakes in Playlist’s review of the iPod Hi-Fi, this menu allows you to change the EQ of the Hi-Fi via the iPod’s screen."



The iPod accessory business is estimated at a billion dollars a year, and growing. I'm surprised it's taken Apple this long to try to compete in this space. As the OEM, they do have an advantage in that they can integrate added software functionality into iPod hardware, which is something their 3rd party competitors can't do. If they can properly leverage this capability, they may be able to take a serious chunk out of everyone else's business.