The LA Times reports that Apple might buy Universal Music. Let’s hope that this falls through, the last thing Apple should be doing right now is following Sony down the path of being part an electronics company and part a entertainment company. All that does is create two conflicting agendas withing the same organization. The result at Sony has been pretty much an internal civil war; we doubt that Apple, with its position precarious enough as it is (the company has been losing money and market share lately), will be strong enough to weather a similar conflict.
Remember that Apple was able to create the iPod precisely because it didn’t have an entertainment division to worry about. The iPod should have been a Sony product. They invented the whole concept of portable audio players with the Walkman, but because they were worried about stimulating piracy, Apple is now the brand name most associated with MP3 players. Supposedly 25% of MP3 players sold in Japan are iPods. This is a huge, huge disaster for Sony, and Apple would be smart to learn from their competitor’s mistakes, not repeat them.
It’s all fine and good to think that Steve Jobs can square the circle and get us all out of the stalemate that has emerged in the music industry because of online piracy, but it’s just not as easy as that. Even if Apple wants Universal’s catalog in order to help launch some sort of inexpensive online music service, $5 or 6 billion is a heck of a lot of money just to get access to about one-fifth of the music that’s out there.
We’re sure Sony thought something similar, that having an entertainment division would help it sell more hardware. But it’s funny how those things never turn out the way you expect them to, and now Sony’s entertainment division is keeping the company from doing what it does best: making great electronics. We’d really like to see Apple just stick to what it does well. Lately that’s been stealing Sony’s thunder.
