Logitech + Slim Devices = fat margins?
Engadget is reporting that Logitech, the giant computer-peripherals maker best known for its computer mice and keyboards, has acquired Slim Devices. For Engadget, it's all about the gear, and they give a nice rundown of the companies' competing wireless music systems. But what's the deal really about? Slim, famed for the Squeezebox music player which connects your PC's music library to your living-room stereo, is known for smart software, not just hardware. And as Apple proved, to really succeed in digital music, you have to pair sleek hardware with equally well-designed software.

People used to scoff at the hardware-plus-software approach, saying that open platforms like Microsoft Windows - for which anyone can build compatible hardware - would win out in music players, too. Rrrrright. That explains why iPod sales are up 35% and Microsoft is now aping Apple's approach by rolling out its own Zune player in November.

Logitech's Slim buy also recognizes another truth of the hardware-plus-software equation: Done well, combining the two yields higher margins, as consumers pay more for unique, software-driven features. That should help Logitech in arenas beyond just digital music, as it aims to keep rolling out upgraded gear that can command a premium on computer-store shelves.
Posted by Owen Thomas 11:21 AM 0 Comments comment | Add a Comment

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