WHO?

Hello, my name is Alexandra Mone and this evening Im going to deliver a presentation based on a quote attributed by many to Charles Darwin even though he never said it, but thats another story and it doesnt have much relevance for what I am about to present. WHY? The quote Im talking about says the following: Its not the strongest of the species that survives, nor the most intelligent, but the most responsive to change! and the purpose of this presentation is to see if and how this applies to the business environment. And what better way to do this than to analyze a practical example! For that I chose two well-known companies with one of their most representative products: SONY with their Walkman and Apple with the iPod. WHAT? For a better understanding of later events, I will firstly give you a piece of information about each companys beginnings and their main focuses. Secondly, well see how the Sonys Walkman came into picture and what it meant for the industry of consumers electronics. The third point of the presentation will focus on the changes in the industry, how Sony reacted to that and how Apple designed their strategy to enter the business in those conditions. Last but not least, well see who won this duel and how this two companies fit in the quote mentioned earlier. HOW? Ill try to keep it short and to the point, and in the end you can ask questions or express your point of view regarding this topic. I also created this PowerPoint presentation to help me emphasize the most important facts. PRESENTATION 1. So, first of all lets see some facts about SONY: Sony Corporation, commonly referred to as Sony, is a Japanese multinational conglomerate corporation headquartered in Tokyo, Japan. Founded on May, 7th 1946 as Tokyo Telecommunications Engineering Corporation (Tokyo Tsushin Kogyo), the company changed its name to Sony in 1958 Its diversified business is primarily focused on the electronics, game, entertainment and financial services sectors. The company is one of the leading manufacturers of electronic products for the consumer and professional markets Sony is ranked 94th on the 2013 list of Fortune Global 500 The company's current slogan is make.believe. Their former slogan was like.no.other.

2. Now, a few words about Apple: Apple Inc., formerly Apple Computer, Inc., is an American multinational corporation headquartered in Cupertino, California The company was founded on April 1st, 1976; the word "Computer" was removed from its name on January 9th, 2007, the same day Steve Jobs introduced the iPhone, reflecting its shifted focus towards consumer electronics. It designs, develops, and sells consumer electronics, computer software and personal computers. Its best-known hardware products are the Mac line of computers, the iPod music player, the iPhone smartphone, and the iPad tablet computer. Its consumer software includes the OS X and iOS operating systems, the iTunes media browser, the Safari web browser Apple is ranked 19th on the 2013 list of Fortune Global 500 The company's current slogan is Think Different. Their former slogan was Byte into an Apple. 3. Moving on, lets see how Sony managed to revolutionize the market of consumers electronics. In 1978, engineers at Sony successfully married a compact playback device with lightweight headphones to create the prototype for a product that would become a worldwide hit. It allowed people to carry music with them and listen to it through lightweight headphones. In 1979, the Walkman was introduced in the Japanese market, selling out its entire stock of 30,000 units within the first three months. Sony kept apace with its rivals. For a decade after its launch, Sonys Walkman retained a 50% market share in the U.S. (46% in Japan) in a space teeming with competitors, even as it enjoyed a price premium of approximately $20 over rival offers. 4. Now, lets jump ahead to the late 1990s, when the sun had set on cassettes as the favored music delivery format in favor of compact discs and,or for those more modern - digital mp3 files. Electronic firms around the globe were betting that the CD would soon follow the cassette into extinction. So there is the question: which mp3 player would get there first and become the next Walkman? In 1998, South Koreas Saehan Information Systems created the first portable digital audio player, MPMan. It sold 50,000 players globally in its first year. By the launch of the iPod in 2001, there were approximately 50 portable mp3 players available in the U.S. and no firm had achieved anywhere near the dominance that the Walkman had enjoyed 20 years earlier. 5. This leads us to a more detailed analysis of the industry: Compared to the Walkman and cassettes, the story was very different for mp3s. You couldnt purchase them in traditional retail stores. Downloading an album legally or not could be a multi-hour affair. It didnt matter that MPMan was first it wouldnt have mattered if they were 6th, 23rd, or 42nd. Without the widespread availability of mp3s and broadband, the value proposition could not come together.

The MP3 player market did eventually consolidate around a dominant product, Apples iPod. But the iPod, launched in late 2001 three years after the MPMan was anything but a first mover.

6. Now that we have the bigger picture, lets see how we can understand the iPods success despite its delayed entry: Apple waited, and then waited some more until it finally made its move, putting the last two pieces in place to create a winning innovation: an attractive, simple device supported by smart software. Steve Jobs knew that, on its own, the mp3 player was useless. He understood that, in order for the device to have value, other co-innovators in the mp3 player ecosystem first needed to be aligned. And, in October of 2001, when Apple announced the iPod, those pieces were solidly in place: both mp3s and broadband were finally widely available. The first generation iPod for Macintosh retailed at $399, had 5GB of capacity, and could store up to 1,000 songs. It boasted an intuitive interface design and was, for its time, lightweight. But the value of the device was set in place by its seamlessness with the iTunes music management software. Despite being available only for Mac users, the iPod was the fastest selling mp3 player to ever hit the market. 7. Meanwhile, you should know that, in fact, Sony was the first to unveil its not just one, but two digital music players at Las Vegas Comdex trade show in 1999. It was two years before the introduction of the iPod by Apple, and presumingly should have given Sony sufficient time to capture the portable digital music market before the imitators entered the scene. However, this introduction of two products at the same time demonstrated that Sony was too focused on the technical implementation of the product itself, and protection of its content from unauthorized copying, while ignoring the actual needs and wants of their prospective customers. SUMMING UP 8. So, to sum up, I can say that Sony underestimated the new realities of the digital marketplace while Apple reacted to those changes and took advantage of them.

CONCLUSION 9. In conclusion, even though it was a strong and intelligent company Sony chose to ignore the changes and its ignorance to this fact proved to be fatal for the companys success in the digital music marketplace. One the other side, Apple proved to be responsive to change and that made from it what Sony used to be once upon a time: the leading brand in consumer electronics, a wellspring of innovative products that customers gladly paid a premium for. So we can say that from this point of view its true that Its not the strongest of the species that survives, nor the most intelligent, but the most responsive to change! . 10. CLOSING REMARK So this was it, thank you for your attention and I hope you found the presentation quite interesting and that you werent very bored. If you have any questions or remarks please express them!