"Barbie, meet KIN"

Microsoft this week announced their KIN social networking devices (phones) designed for a younger set whose primary interest, in addition to an occasional phone call, is social networking. The timing of the announcement interestingly coincides with news that the sagging Palm phone maker is up for sale, having missed several windows of opportunity to capture growing consumer interest in smartphones. Microsoft, expert marketers that they are, have left no question as to who is the target demographic. They may have carved out a position in a tight, yet well-defined demographic well served by Disney, Miley Cyrus and the Twilight crowd. These tweeners and teens may have the income to purchase a smartphone but find their allowance lacks the heft to support the iPhone data plan. In the bloody battle of mobile phone marketing, Microsoft may be content to win a small slice of the growing pie. After all, Zune keeps on quietly plugging in the shadow of the iPod.




Parks Associates’ Consumer Decision Process research of buyers of CE products revealed that Nokia, once the unequaled leader of the U.S. mobile phone market, last year fell to the bottom of the list of brands of basic mobile phones that people would recommend, as measured by Net Promoter Score (NPS). We have to assume that the bright minds at Microsoft did not enter this arena without extensive, long-term battle plans well drawn.

New iPods and Zunes Upcoming, Why Bother and Will Consumers Bite?

Apple unveiled its new iPod lineup yesterday. But media and Apple fans seemed to give a yawn to the event. No more “one-more-thing” hype and exuberance in San Francisco yesterday. Even the stock market slapped down Apple shares ruthlessly amidst overall market slide.

One or two days before Apple’s scheduled product showcase, Microsoft announced its third-generation Zune players. Despite the fact that Zune has never reached even one-tenth of iPod sales volume, Microsoft has been patient and persistent in its catching-up game.

Early adopters and tech junkies might already feel bored about the whole MP3 player category. The entire industry’s attention is on the sexy iPhone and its many copycats and would-be killers. True. If you look at MP3 player penetration among all households, it already crossed the 40% mark in early 2008 based on Parks Associates’ National Technology Scan survey. The growth will slow down, inevitably. That’s also true.

But the press and the pundits missed a point. Behind these tiny and shiny gadgets is a gigantic and still-under-tapped digital content distribution market, and portable devices are the first and will continue to be an important platform to groom it till it explodes.

Back to the hardware, both makers have made important upgrades, from form factor to functions, from user interface to experience-enhancing new features. They lowered the prices too. Although the new devices are less alluring in the eyes of technology aficionados, the other 60% of the U.S. households will find bargains and better values after a not-too-long waiting period (two years, perhaps). Yes, the growth curve will flatten out, but 50-60 million iPods a year for Apple is not bad at all, definitely an envy to other players in the field.