The iPod was popularized to the mainstream in 2003 with a series of iconic commercials featuring silhouetted figures wrapping themselves up in Apple's iconic bold white wired earbuds while dancing to the beats of early 2000s pop jams.
Thirteen years later, Apple is cutting the cord.
The iPhone maker is widely expected to introduce its first iPhone that comes without a headphone jack on Wednesday. This device, which has yet to be officially confirmed by Apple, will likely force users to upgrade to new Lightning-cord headphones or, as will more likely be the case for most, connect wirelessly with Bluetooth headphones and earbuds. It's a drastic change for the iPhone and one many entrepreneurs say will create a tectonic shift in the audio market.
Apple "will fundamentally change just one aspect--the way you connect your headphones to your iPhone--and force an entire industry to accommodate," said Danny Aronson, CEO and co-founder of Even, a startup that sells earphones that personally customize sound to the ears of each user. "Apple has decided that it's time to move forward."
Across the audio industry, there are mixed feelings. For some, Apple's decision to remove the jack--a staple component of any computer or portable electronic for the past few decades--is the greatest opportunity for innovation the audio market has seen in a long time. For others, there is hesitation to adapt and confusion as to why Apple would make such a substantial alteration. The one thing that's certain is that Apple is about to cause a sea change to the way consumers listen to music on the go.
"Many users have given little thought to which headphones to buy and will be more curious about the competition," said Luc Pierart, CEO of PKparis, which makes a the K'asq, a pair of completely cordless Bluetooth earbuds. The K'asq has five hours of continuous battery and retails for $149. "We're hoping that this move in the market will shake things up."
Throughout its history, Apple has consistently caused significant shifts like this. In the past decade alone, Apple has removed the disc drive from its computers starting with the MacBook Air in 2008, forced its iPhone users to switch from their 30-pin power connectors to the Lightning connector with the iPhone 5 in 2012, and got rid of the charging, HDMI and original USB ports in lieu of a single USB-C port with the new MacBook last year. For Steve Jobs' company, which flung us head-first into the world of touchscreen and app-filled devices, there is no fear when it comes to ruffling feathers, said Alexander McKelvie, associate professor of entrepreneurship at Syracuse University's Whitman School of Management.
"Customers are the ones who will have to adjust their behaviors because of this change--and that might mean buying separate wireless/Bluetooth headphones or potentially buying separate headphones that would fit other ports (likely at an additional cost)," McKelvie said. "And history shows that the customers will follow Apple's changes."
Audio entrepreneurs have been preparing for this massive change since late 2015 and early 2016 when rumors of Apple's plans first began swirling in industry circles. For them, the challenge is figuring out how to adapt to the new iPhone without putting all of their eggs in one basket should consumers choose to reject Apple's radical switch.
"There's a lot of uncertainty around what exactly is going to happen," said Jordan Yoder, vice president of product at Plugged, which sells minimalist headphones for $99.99. "We're doing everything we can just to stay in front of it. I think we've done a good job, but it's absolutely an issue to building product."
There are a number of obstacles facing these entrepreneurs. For those that go the Lightning route, it will cost more to purchase the parts necessary to connect through Apple's proprietary port than it did with traditional audio jacks. The wait times are also long and fluctuate widely, several of these entrepreneurs said. Additionally, the Lightning port works only with Apple's mobile devices--meaning these products are useless for Apple computers, Android devices and other electronics. This will likely push more entrepreneurs toward building Bluetooth solutions.
With Bluetooth, the trick is to figure out how to build products with long battery life, strong connectivity and high-quality sound--all factors that many products on the market today fail to address. As more companies begin selling Bluetooth headphones, these problems should start to recede.
Already, the market has seen an influx of new products hoping to capitalize on the change Apple is bringing about. In the past week alone, we have seen new Lightning earbuds, cordless Bluetooth options and new Bluetooth adapters for auxiliary cords, such as the $19.99 Griffin iTrip Clip Bluetooth Audio Adapter.
"A change like this is going to weed out a lot of the smaller companies," said Robin DeFay, CEO and Co-founder of Zipbuds, which which makes fitness earbuds. The company's upcoming Catalyst earbuds will connect using Bluetooth. "In this day and age you have to bring something to the table that really changes the game in order to get any attention. It's a very crowded space, and if you're not doing really something special, nobody's going to care about it."
There remains, of course, a chance that Apple's decision will backfire. The makers of only one other major smartphone--the Motorola Moto Z--have announced their device won't have a headphone jack, so there will be pressure on Apple to change consumers' behavior. Should they decide they don't like this shift, Apple could lose customers. That would be a major blow for the company, which has seen its stock fall 5 percent since last September in large part to lagging iPhone sales.
"It's a very polarizing change," said Aniyia Williams, CEO of Tinsel, a startup that makes fashionable necklaces that double as headphones. Tinsel's current product uses a headphone jack, but it is starting to develop a Bluetooth product. "I really think that it has the ability to drive some of their customers away."
But in many ways, Apple is simply spurring a change that is already occurring. Bluetooth headphone revenue overtook that of non-Bluetooth headphones for the first time when it made up 54 percent of headphone dollar sales in the U.S. in June, according to a report by The NPD Group. At the same time, wireless headphones already take a 31 percent of market share, according to Statistic Brain. The shift to wireless headphones is happening, and Apple is hastening that transition.
"What we see from the data is that the shift from wired into wireless is already taking place," said Ben Arnold, industry analyst with The NPD Group. Arnold said the rise of fitness headphones as well as the popularity of portable Bluetooth speakers have been the catalyst behind consumers' move toward Bluetooth options. Apple "helps to tilt the scales more into Bluetooth's favor."
In the short term, the clear losers in this shift will be Apple users. The onus will be on them to either purchase new audio gear or buy accessories that will allow their old headphones and earbuds to connect with future Apple products.
"The losers are consumers who want a dependable, low-cost way to listen to their iPhones in privacy," said David Chen, CEO of NextWorth, which is a secondary market where consumers can sell their old electronics. "People are going to have to buy bluetooth adapters to enable their own headphones and/or trade-in their old ones and buy bluetooth headphones."
In the past, Apple has bundled earbuds with all of its iPhones, but it's unclear if the Cupertino tech giant will do something similar for the next iPhone either by way of Bluetooth earbuds or a Lightning-port adaptor. There have also been reports indicating that Apple could launch new headphone products through its Beats by Dre brand that capitalize on the removal of the audio jack.
"You can look at this one of two ways. You can say 'Oh my god. Apple is bringing out a product that will compete against us. We're dead in the water,'" said David Cannington, co-founder of Nuheara, which makes cordless Bluetooth earbuds that can distinguish separate speech from ambient background noise. "Or you can say 'Apple is bringing out a product that will be different from ours and our challenge is to create innovative technology that delivers a better consumer experience."
Certainly, it is expected that there will be some consumers who gripe loudly about the change, but overall, many expect that users' love for the iPhone will trump any hesitations they may have about changing they way they listen to audio.
"Anytime there's a major fundamental change like that, you're going to have people who resist it, fight it, don't like it or don't understand it, though it's for the greater good in the long term," said DeFay of Zipbuds. "It'll be interesting to see how it goes."