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Technology Consumers Got More Choice in '07

By Rob Pegoraro
Thursday, December 27, 2007; D01

The technology business has a reputation for innovation, but three things have stayed constant for years: The computing world revolved around Microsoft, your wireless carrier controlled what your cellphone could do, and the record labels locked your legal music downloads with software to limit what you could do with them.

All three of those constants started to crumble in 2007.

Unlike the usual flux of products coming and going, those changes have the potential to significantly alter the business, giving people more of a choice in how they use technology.

Some companies will profit and others will suffer from these changes, but so far Apple has benefited the most -- often at the expense of Microsoft.

Start with the computer business. Macs have always been a niche alternative to PCs, but in 2007 customers began switching in large numbers.

In the first 10 months of 2007, the NPD Group's survey data show that 8.6 percent of new computer sales were Macs -- up from 5.4 percent in the comparable period in 2006 and 3.4 percent in the first 10 months of 2004.

When more than one of every 10 new home computers run the Mac OS X operating system, a lot of software developers who had ignored the Mac will start paying attention to it.

That's not all good: Some of those people create viruses and worms. They will find that it's harder to attack a Mac than a Windows PC, because of basic differences in the way Mac OS X works. But OS X does have vulnerabilities that could be exploited.

Apple's successful switch to Intel processors, which made it easy to run Windows alongside Mac OS X, gets much of the credit for the company's new popularity. So does OS X itself -- a remarkably sane and simple way to run a computer -- and the often-outstanding programs bundled on new Macs.

But Microsoft didn't help itself, either.

Windows Vista's steep system requirements made it unusable on many Windows PCs. Vista's stringent anti-piracy routines alienated law-abiding customers. Its well-intended "User Account Control" security turned out to be a nuisance.

Many third-party software developers who had fueled Microsoft's past success also sandbagged Vista. Some took months to revise their programs for the new system; some still haven't finished the job.

Windows Vista also lost all hope of being the year's biggest product debut when Apple introduced the iPhone. Its touch-sensitive screen, which lets you zoom into Web pages by spreading two fingers across the screen, brings the same frictionless simplicity to the mobile Web that the Nintendo Wii brought to video games.

The iPhone also showed what could happen if wireless carriers left phone design to people who were actually good at it. What if, say, the Web's premier source of information could make a phone?

It just so happened that in November, Google announced its Android project and a lineup of phone manufacturers and wireless carriers that will work on it. When it ships the second half of next year (if all goes well), Android will let any user customize it at will.

Not long after that, one of the most controlling carriers ever, Verizon Wireless, announced that it would open its network to any compatible device -- not just those customized to its specifications -- in 2008.

Other carriers have joined in selling freedom as a feature. For example, AT&T now brags that customers can use any compatible phone on its network.

At about the same time that the wireless-phone industry was toppling its equivalent of the Berlin Wall, a similar barrier was tumbling in digital music.

That barrier -- the digital rights management (DRM) software that controls what you can do with a song download -- was once an unquestioned part of the music business. But in February, Apple chief executive Steve Jobs picked up on many listeners' complaints and posted an open letter urging the end of that regime. Then one of the major labels, EMI, began selling music without copy controls on Apple's iTunes and other stores.

Wal-Mart and then Amazon.com opened MP3-download stores, featuring more unrestricted downloads than iTunes. Apple responded by cutting prices and expanding the selection of its DRM-free offerings; Microsoft, in turn, added a million MP3s to its Zune store.

Some major record labels have resisted this change, but the market will not grant them much choice -- their competitors sell a better product.

How long will it be before movie studios reach the same realization?

Each of these three trends, seen in isolation, might not seem like much. The new popularity of one flavor of computer doesn't change the fact that most people still use PCs. IPhone idolatry and Android anticipation don't help users chained to cellphone contracts. And for all the songs sold without usage restrictions, most downloads wear the same old DRM shackles.

But these things combined suggest that parts of the tech industry are grasping the value of choice -- a feature that might be more attractive to buyers than the usual faster-better-cheaper sales pitch.

Living with technology, or trying to? E-mail Rob Pegoraro atrobp@washpost.com. Read more athttp://blog.washingtonpost.com/fasterforward/

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