Thursday, April 16, 2009

Sony to Pure Digital -- Flip Off!

Well, isn't this predictable in the new world order?  Sony, years ago the recognized innovator and leader with cool gadgets (remember the Walkman?), has become the follower, playing catch-up to others with some of the freshest ideas.  Sony failed to see the coming of digital music's power in time, and Apple seized and never let go of the title of King of all things digital music (iPod, iTunes).  Sony's late-in-the-game competitive music services (Sony Connect) never really caught on (and Sony ultimately essentially abandoned the iTunes market).

First, music.  Now, consumer video.  

Sony always led the game here, with cool camcorders that have lots and lots of buttons and lots and lots of possibilities.  But, then young entrepreneurial upstart Pure Digital Technologies (backed by heavy-hitter VCs) enters the "established" game and disrupts it, focusing on simplicity -- call it, purity -- in the consumer video market.  Rather than more buttons, Pure focused on less buttons.  And, in an homage to "size really does matter", Pure slimmed down the form factor to the point that its "camcorder" (if you can call it that) fits into your pocket.  Really, it does.  And, the result?  The Flip video cam.  Quality does not suffer in this metamorphosis -- the Flip cam is capable of capturing HD video.

And, the rest is history here.  Pure Digital scores a massive hit, striking a chord with the YouTube generation accustomed to short-form video.  Cisco sees this success, and pounces on it, acquiring the company for $590 million -- higher even than the sale of MySpace to News Corp. several years.  Quite a feat in general -- but, especially so in these crazy economic times.

So, here we go again.  Sony sees disruption to a market in which it previously held a strangle-hold.  And, Sony is forced to play catch-up.  But, this time, will it be different?  This time, Sony plays rapid-fire development outside Sony's typical development process.  The result?  Sony has just announced its own line of pocket video cams -- the Webbie HD -- in an attempt to tell the YouTube market to "Flip off!"

Slowing down the Flip -- which now has a rabid community championing it -- will not be easy, however.  Especially now with Cisco financing that train.  But, Sony recognizes what's at stake here -- its video pre-eminence.  It simply can't fail.  

But, will the YouTube generation gravitate toward the Sony brand?  Does it still have the "cool" factor?  Or, will Flip turn the tables on video?

I have some ideas that could help for both companies ...

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