In episode 38 of Acquired, hosts Ben Gilbert and David Rosenthal discuss Apple's acquisition of SoundJam in 2000, the software that evolved into iTunes, and its pivotal role in Apple's digital music strategy. They highlight how the acquisition accelerated Apple's entry into the digital music space, allowing the company to quickly launch iTunes and subsequently the iPod, shaping the company's future. The episode also touches on the importance of developing products that resonate with consumers, the difficulty of competing with free software, and the potential of a digital hub strategy, as exemplified by the Echo Show. The hosts note that while the acquisition wasn't the sole reason for Apple's success, it played a significant role in catalyzing its digital music revolution.
"And iTunes sucks." "iTunes does suck." "Well, yeah, it's bloated."
The quotes express a common sentiment that iTunes is not well-liked due to its perceived cumbersome nature. This sets the stage for a discussion about its origins and significance to the podcast industry.
"Welcome to episode 38 of Acquired, the podcast about technology acquisitions and IPOs. I'm Ben Gilbert. I'm David Rosenthal, and we are your hosts." "We would love a review on iTunes. It is how we grow the show and make it better."
These quotes introduce the podcast's theme and the hosts' request for audience engagement through iTunes reviews, which they believe are vital for the podcast's success.
"We're just getting more professional here." "It's funny how with these things, when you decide to up level a little bit, that becomes the new bar, and then that's just the bar that you have to hit every episode after that."
The quote highlights the hosts' journey towards professionalism and the self-imposed standard they now strive to meet in each episode.
"Pilot is the one team for all of your company's accounting, tax and bookkeeping needs." "Startups should focus on what makes their beer taste better... and outsource everything else."
The quotes explain the role of Pilot as a comprehensive financial service provider for companies, emphasizing the strategic advantage of outsourcing non-essential tasks.
"Today we are covering Apple's 2000 acquisition of SoundJam, which would go on to become iTunes." "Jeff Robin and Bill Kincaid step into the fray and emerge as the saviors for teenagers pirating music in America."
The quotes introduce the main topic of the episode—the acquisition of SoundJam by Apple—and its significance in shaping the digital music landscape.
"Jeff Robin and Bill Kincaid worked at Apple in the mid '90s... when it never shipped and Apple acquired NeXT, they ended up leaving the company." "SoundJam MP is the most complete. It's the only Mac MP3 tool capable of not only playing back MP3 files, but also encoding tracks from audio CDs."
These quotes provide background on the founders of SoundJam and the software's capabilities, which were groundbreaking for Mac users at the time.
"in hindsight, infamous Ui element of soundjam was the visualizer. And Apple included this when they launched it in iTunes. But this was looking at this took me back 15 plus years at this point. Winamp, I think, pioneered this, but when you would listen to digital music on a digital music player on your computer, you could have the option to have a visualizer where it would take the sound waves from the mp3 you were listening to and then put it through all these transformations and make it into this psychedelic landscape that you were watching sort of in time to the music. And Steve Jobs loved this. Talked about how it reminded him of doing LSD in his youth."
The quote explains the origin and appeal of the visualizer feature in digital music players, highlighting its inclusion in iTunes and its nostalgic connection to Steve Jobs' past experiences.
"So pretty quickly, Apple takes an interest in Steve Jobs and Apple realizes that, hey, digital music is here to stay. And there is now a big wave and big opportunity for computer companies and technology companies to invade the music business."
This quote emphasizes Apple's early recognition of the significance of digital music and the opportunities it presented for the company's future growth.
"Apple actually released something in June of 2000 called Music Player. That was six months before itunes came out. And it is like the most basic sort of the finder. When you look at it, you're like, that's a separate app. It's a pretty bare bones thing."
This quote details Apple's initial foray into music software, preceding the more advanced iTunes, and hints at their strategy to build upon a basic foundation.
"Well, yeah, I mean, there certainly was venture at the time. I mean, this was the middle of the tech bubble. But I think a couple of things. One, we're talking about Mac only and that was just a tiny, tiny portion of the market at that point, at least from a. And two, I mean, I think we're also just really early in the consumerization of the know."
This quote reflects on the state of venture capital during the tech bubble and the reasons why digital music players, particularly Mac-only software, did not attract significant VC attention.
"Apple tries to meet with both Soundjam and audion. They're obviously successful in meeting with Soundjam, and they know the folks there well, since they were all former Apple employees. But Audion and panic, they've separately been negotiating with AOL, which owned Winamp and was considering also acquiring audion and having it, bringing it into the fold and having it power, sort of the win amp version for macs."
The quote describes the situation where Audion, created by Panic, was in acquisition talks with AOL, which complicated their potential engagement with Apple. This highlights the business dynamics and decisions faced by indie developers at the time.
"So they end up turning apple down, and cable doesn't talk about it in the blog post. But I wonder if Steve repeatedly telling them that he's going to basically insulting their chances and telling them he's going to steamroll them, which he was totally right, had something to do with it, too."
This quote reflects on the decision of Audion's developers to reject Apple's acquisition offer, suggesting that Steve Jobs' aggressive approach may have influenced their decision to maintain their independence.
"There's one fork where maybe they acquire audion instead of sound jam and then sort of the same thing happens, but the two parties are switched."
This quote discusses a hypothetical scenario where Apple might have chosen to acquire Audion instead of SoundJam, suggesting that the end result of having a music player like iTunes might have been the same.
"Yeah, but they did grab sound jam. And as best as we can tell, all the sound jam guys are still 15-17 years later, all at Apple."
This quote confirms that the SoundJam team remained with Apple for many years, indicating the acquisition's long-term success in retaining talent.
"This was a people acquisition."
This quote emphasizes that the primary value of the acquisition was in the expertise of the SoundJam team rather than the technology itself.
"The MP3 file format patents actually expired last month on the 16 April."
This quote highlights a significant event in the legal landscape of digital audio formats, which could influence the development of new MP3-related software.
"Our sponsor for this episode is a brand new one for us, Statsig."
This quote introduces the episode's sponsor, providing context for the discussion of Statsig's services and relevance to the technology industry.
"I went from being the music on a zip drive person to music on an external drive person to having every single one of my files on my computer itself."
This quote illustrates the personal evolution of one speaker's music consumption habits, reflecting the broader technological changes in music storage and access.
"Companies acquiring people that used to work for them."
This quote introduces the theme of companies reacquiring talent that had previously left, which is not as common as initially thought by the speakers.
"There's this concept of getting sherlocked, where Apple introduced search Sherlock, the feature, and that was a third party utility before and when it got built into the platform."
This quote explains the term "sherlocked" and its implications for third-party developers when their features are absorbed by the main platform.
"I wonder if it's really that both the focus that Steve had on really well on a, doing individual apps, right, and having a ton of focus on them, b, having them be key parts of his overall vision."
This quote ponders the unique impact Steve Jobs had on Apple's product direction and the depth of focus on individual applications.
"You need to make something that people want, and the best way to do that is, and to know you're making something people want is to make what you want."
This quote encapsulates the philosophy that successful products often stem from the creators' own desires and needs, aligning with those of the market.
"He had an experience in his mind that he had a vision of that was so clear to him and that he wanted, and then he was so exacting in managing the products to really, really solve that need and bring delight to what he wanted and that aligned with technology trends and with what lots of people wanted."
This quote emphasizes the importance of having a clear vision and being meticulous in product management to create successful products that resonate with both technological advancements and user desires.
"Layers of abstraction that you used to have to write assembly language or even before that, the hex or the binary. And then you get the aven and machine language. And then ever since, you just keep building more abstraction layers on top of the stack."
This quote highlights the progression of programming languages from low-level to high-level abstractions, indicating a trend towards simplification and increased efficiency in coding practices.
"It's really hard to compete with free in technology. And if you have a utility app and it's just a utility, somebody, if there is a big enough market for that, somebody is going to come along and make it free."
This quote underscores the challenge of competing with free services and the necessity of building ecosystems or networks to create long-term value and a sustainable business.
"Apple was going to do this with or without either of these companies. They would have figured it out. They would have found a way to hire the right people. This is square in their core competency."
This quote discusses Apple's ability to develop its music ecosystem regardless of specific acquisitions, suggesting that while acquisitions can be helpful, they are not always the primary driver of success.
"You can see the potential here for something like the show and future versions of Alexa and echoes to become the hub of Amazon, the hub of e-commerce."
This quote reflects on the strategic potential of the Echo Show and similar devices to become central to Amazon's business, particularly in e-commerce.
"But I would assume it will be done on Facebook's infrastructure, not BAMtech's, which is interesting given BAMtech is now an independent company outside of MLB."
This quote points out the strategic business decision by MLB to use Facebook's infrastructure for live streaming, indicating a shift in partnerships and distribution strategies.
"They're going to need to definitively answer yes or no and how they're going to reignite user growth. And this is like we talked about on the episode. I mean, just the exact same situation that Facebook was in right after their IPO with totally missing mobile."
This quote draws parallels between Snap's current situation and Facebook's challenges post-IPO, emphasizing the importance of addressing user growth to ensure the company's future success.