Living with Complexity: How Apple Reinvented Music DistributionS

iTunes' dominant position atop the digital music market is not happenstance. Donald A. Norman discusses how, through the integration of its products, design and service, Apple became a media distribution juggernaut.

Many services are both social and complex systems. Many are provided by large organizations, with components in very different geographic locations. Quite often the different parts of the organization do not understand or communicate well with one another. And many services involve different organizations, and communication among them is particularly difficult.

It is easy to find examples of the complexity of services: think of almost any interaction with a governmental agency. There are many potential sources of difficulties, from the interaction with government employees, the complex set of rules and regulations that must be followed, the complexities of the forms that must be filled out, and then to the impenetrable delays that occur as the request moves from one office to another, perhaps from one agency to another. Even if everyone is helpful and friendly, the sheer complexity of the operation coupled with the relatively poor interfaces among all the components can lead to frustrating experiences.

The only way to solve the complexities of services is to treat them as systems, to design the entire experience as a whole. If each piece is designed in isolation, the end result may be of separate pieces that do not mesh well together.

Apple's iPod Music Service
Portable music players are a very popular product. Carry along a small device with hundreds or thousands of your favorite musical selections, available to the listener whenever and wherever desired. Ever since the first portable music players were developed using cassette tape recorders in the 1970s, portable music players have revolutionized the way people listen to music. The first major success was the Sony Walkman, released in 1979.

It was the computer revolution, however, with the advent of tiny processors and huge-capacity memory systems along with Internet commerce and compression systems that reduced the size of recorded music files, which set the stage for the next revolution in the 1990s. Now the electronic players were much smaller and easier to carry than the Walkman. Moreover, each could hold thousands of songs, something never before possible. The first barrier to the success of these devices was legal ambiguity of getting the music. Although it is legally permissible to purchase music and then to make a copy for one's own personal music player, it is not permissible to distribute that music. The second barrier was the complicated set of steps required to get music into the device: copying, compressing, and transferring the music to the player was a daunting task for the average person.

When Apple entered the market with its products, it created a revolution in the distribution of music. Apple soon took over, not only dominating the sale of digital music players, but also changing the way the music companies thought of their products. Everyone believes that Apple took over the music-player business through its superior design of its device, the iPod, introduced in 2001. No, the iPod, although a truly excellent product, is not the secret to Apple's success. The secret is that they understood that the core problem was not just the design of the product: it was to simplify the entire system of finding, buying, getting, and playing music, and also to overcome the legal issues. Note that at the time, a number of companies were already selling digital music players, some of which were quite attractive and functional. But these were isolated products. Most music could not be acquired legally for use in these devices. Getting the music into one's computer and then into the player required manual operations that were more complex than the average person was able or willing to do. The fundamental problem was the integration of all the parts into one seamless experience. Like the train experience, this system has multiple stages:

- Getting licensing agreements from music producers (making it legal to get the music)
- Browsing the music store to find the desired music
- Purchasing
- Transfer 1: getting the music into one's personal computer
- Transfer 2: getting the music into the music player
- Synchronization and sharing of music libraries
- Listening to the music
- A digital rights management system (DRM)
- Encouraging other companies to manufacture add-on devices, such as external speakers
- Control over the retail environment
- A trademark and licensing scheme

Apple treated iPod as a service, not as an isolated product. They therefore worked diligently to ensure that all stages were handled seamlessly, resulting in an excellent customer experience. In quick summary, Apple was the first company to negotiate the legal licensing of music at a reasonable price per song. Second, they designed a Web site and a companion application for the computer that made browsing through music, searching, and experimenting with new performers fun and enjoyable. Third, Apple made the purchasing trivial, and the downloading of purchased music into one's computer effortless.

Apple also designed the iPod system so that when the iPod is plugged into the computer, the transfer of files into the iPod occurs effortlessly and easily. Finally, Apple's design of its music player, the iPod, was excellent: it is easy to listen to music on the computer, and to stream it among networked computers or even to home audio and television systems.

At the time the service started, music sellers were terrified that people would freely transfer music to one another without payment, so they insisted on digital rights management systems that would prevent this. Apple complied, but it restricted the licensing of its DRM so that the music it sold could only be played on Apple devices, ensuring what marketing people call "lock in": The larger the collection of songs purchased from Apple, the more the person was locked in to continual use of Apple products. The extensive library of music could not be played on devices made by other companies (unless they had licensed the DRM rights from Apple, which was an infrequent event). The digital rights management issue is still an enduring issue, not just for music, but for all media, such as films, video, and books. Media companies are exploring various options that protect ownership rights but are not as restrictive as some of the early implementations. Apple has also loosened the restrictions.

Finally, Apple developed an ecosystem, encouraging other companies to develop add-on products such as loudspeaker systems, accessories for playing the music over automobile sound systems, accessories that enhanced the iPod's capabilities, turning it into a stopwatch, a voice-recording device, and a storage device. All of these were licensed by Apple, which received commissions (royalties) on sales: a risk-free source of revenue.

Apple treated the entire effort as a seamless system. Even the design of the box in which the physical devices were packaged was exemplary. Many companies try to save money on packaging: Apple spent extra money, treating the package as yet another chance to offer the customer an engaging, delightful experience. Apple understands that the user experience starts with opening the box, which should be just as exciting and pleasurable as the rest of the experience.

The story improved with time as Apple expanded the range of devices in their product portfolio to include mobile phones, portable computers and display pads, and other devices that interconnect computers, telephones, cameras, video, and sound systems. Although the repertoire goes far beyond music to devices that manage photographs, videos, movies, games, newspapers, magazines, books, and other media, all follow the system design point of view. The physical structure, the capabilities, and the names of the devices have changed several times, but the general philosophy of making the entire system seamless and effortless has endured. As business conditions change, Apple keeps changing the offering, but it still excels at three things:

- Creating cohesive systems, not isolated products
- Recognizing that the system is only as good as its weakest link
- Designing for the total experience

System thinking: that is the secret to success with services. Whether it is a Disney theme park, an Apple service, Netflix movie service, FedEx or UPS's delivery services, or purchasing from Amazon: because these companies design the entire system, as a customer order or request goes through the backstage operations, these companies keep informing the customer of its progress every step along the way, always estimating shipping and delivery times, allowing the customer to modify the orders far into the process, and making sure that the entire experience is handled well from the customer's point of view. The operations behind the scene are smooth and efficient-this is the province of the operations staff, often using sophisticated mathematical and computer simulation tools to ensure optimal efficiency. Even the dull, mundane operation of shipping a package from one destination to another can be transformed into a positive experience by appropriate attention to keeping the customers informed. Good system design considers the entire process as a human-centered, sociable system.


Living with Complexity: How Apple Reinvented Music Distribution

Don Norman sees design everywhere. Norman's goal is to help transform design from art into an engineering practice, with tools, formal methods, and rigor. Dr. Norman is co-founder of the Nielsen Norman Group, an executive consulting firm that helps companies produce human-centered products and services. Norman serves as adviser and board member to numerous companies and non-profit organizations. He has been Vice President of Apple in charge of the Advanced Technology Group and an executive at both Hewlett Packard and UNext.

top art courtesy LatinSuD via flikr

Living with Complexity is available from Amazon.