Motley Fool Money is a one-hour weekly business radio show syndicated to radio stations across America. The latest show features an interview with CNBC host Maria Bartiromo and our analysts discussing what some of the week's big company news means for investors.
Chris Hill: On Thursday, Apple (Nasdaq: AAPL ) issued guidelines for software developers looking to create programs for the company's apps store. Apple's been criticized in the past for keeping its approval process secret. That's a good move by Apple, isn't it?
Seth Jayson: Well, this is the small move. This document was interesting, and I do have to go here first. They actually said, "We don't need any more fart apps."
James Early: In other words, here I come, Android.
Jayson: Yeah. And I have to believe that they do need more of those, as many as they can get. Actually, the real news from them, I thought, this week, was not only publishing those guidelines, but also completely rolling over on the development guidelines, which said that you pretty much couldn't use Adobe's (Nasdaq: ADBE ) Flash to develop your apps or any other program and then port it to Apple.
Now, we thought we'd discussed this in the past, that that would look like anticompetitive behavior, probably. It seems like Apple seems to agree on that, and they also seem to have given up a bit on their harsh advertising policy. So it looks like Apple has decided they're too big to be that kind of bully.
Early: You know, what was interesting if you saw the release is they did back down on Flash, but they know that high standards are what keep Apple Apple. So they said, "OK, you can develop but you can't do this, this, this." So they still wanted to look strict, like "We're really going to police you on this" because it's their image.
Hill: Okay, but I mean, for someone like me who doesn't have a smartphone and doesn't necessarily care about apps, what is driving the business decision here? Is it a fear of the Justice Department?
Jayson: Oh, I think it's definitely that. And what is interesting is that at this point, this really is a victory for Android and other smartphone operating systems, because this lets developers develop an application and then port it to multiple platforms. What Apple was trying to do was lock them into the iPhone and kind of reduce the development for other platforms.
Early: And the fact that Androids were coming in at a faster rate sure didn't help. I mean, the stock is up 12%.
Charly Travers: Absolutely. Apple's old strategy only worked as long as they were the big dog, and now that Android is dramatically outselling them, they can't play that game anymore.
Hill: Best Buy (NYSE: BBY ) announced it will start selling the Kindle in its stores this fall. Target (NYSE: TGT ) and Staples (Nasdaq: SPLS ) already sell the Kindle and Best Buy already sells other e-readers, including Barnes & Noble's (NYSE: BKS ) unfortunately named Nook.
James, it seems a little odd that Best Buy is just getting around to selling the Kindle, but who do you think this is better for? Is it better for Amazon (Nasdaq: AMZN ) or is it better for Best Buy?
Early: I say proportionately Best Buy, because they're hurting in some other respects. But really, is the only reason you haven't bought a Kindle because you couldn't buy it at Best Buy? I mean, at the end of the day, it doesn't come down to distribution or availability. It comes down to functionality, price, and format for all these. So I think it's kind of the same game for Amazon after that.
Jayson: Amazon is definitely the beneficiary. Right now, if you can get a Kindle there, Staples, Target, I don't think that moves the needle much. But what it does do is it convinces people that the Kindle format -- and these all include digital rights management -- is there to stay. And you can also already read your Kindle content on BlackBerry, on an iPhone, on an iPad, on Android. I'm sure it will be on the upcoming new Windows phone OS.
So in other words, people have a lot less to worry about. Kindle is the razor; the blades are the books. And Amazon wants to sell millions and millions of e-books and this just helps them do that.
Early: I prefer the dot matrix printer analogy. (laughter) It's a little bit crude, but at the right price it might be a decent e-reader.
Hill: I have to believe it helps Amazon that, to your point Seth, that it's just out there for people almost to test-drive. So even if you're not buying it at Best Buy or any of these other stores, at least you get to check it out and see what the functionality is like and kick the tires a little bit.
Jayson: Otherwise you're like me and you're just paying $400, which is what they cost originally, for this thing you've never seen.
Hill: Now, we've talked on this show before about James Early's borderline unhealthy fascination with Apple products. I think his young son has seven iPods. How many Kindles do you own?
Jayson: We just have the old ones.
Hill: Oh, really? It's not in the teens?
Jayson: No, that's the thing. Ours are the old, crummy, clunky, first-generation ones. (laughter) But really all you need is a screen you can read, a long battery life, and that's what the Kindle has that the iPad does not have. And the iPad will never have. And that's why Kindles will continue to be popular with people who are just interested in plain books.
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