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Ok, so I could have chosen a less obnoxious title. Also, it’s not like I was the only one making the point…but STILL.

Today we find out many things from Apple, including that they are releasing the iPod “Touch,” which is basically an iPhone without the phone. What I found almost more interesting was the following:

1) They will be discontinuing the 4 GB iPhone. While supplies last, they can be had for only $299. See engadget for more.

2) The price on the 8 GB iPhone has now dropped to $399 from $599.

…I would just like to take this time to reference my post from June when I noted that the storage size of the iPhones was just not enough to get it done right. The 4 GB iPhone was apparently lagging way behind in sales, and I’m sure it won’t be long before the 8 GB model is just not enough and a 16 or 32 model will be on the shelves (Christmas was my earlier prediction.) When you’re encouraging people to watch portable video and put all their tunes one on device, 4 GB isn’t going to cut it. In my mind, neither will 8 GB, so I’m going to hold off on getting one for now. But at Christmas I might have something to ask for.

In any case, it’s amazing to see everything that Apple comes forward with. The new iPod, the redesigned Nano, new iPhones….It is also quite clear that the download and portable media paradigm is shifting heavily to video. If you thought the iPod video was cool, brace yourself. Now we wait for the “Goog” phone and what Sony has up its sleeve and then, as consumers with the holidays fast approaching, wait for the prices to fall.

In case you missed it, Google officially ended its DTO/DTR (download to own, download to rent) video service last week. Google let folks who had previously purchased a video know (like me!) that:

…we will no longer offer the ability to buy or rent videos for download from Google Video, ending the DTO/DTR (download-to-own/rent) program. This change will be effective August 15, 2007…After August 15, 2007, you will no longer be able to view your purchased or rented videos.

To fully account for the video purchases you made before July 18, 2007, we are providing you with a Google Checkout bonus for $2.00. Your bonus expires in 60 days.

As you may have guessed, many people weren’t too happy with the way this originally went down. People who had purchased videos now had about a week to watch them before their purchases were rendered useless. The consolation? A $2.00 Google Checkout bonus.

Not too long after this announcement - about a few thousand letters and blog postings later - Google admitted that they made a mistake. On their official blog they wrote:

When your friends and well-intentioned acquaintances tell you that you’ve made a mistake, it’s good to listen…we thought offering the refund in the form of Google Checkout credits would entail fewer steps and offer a better user experience. We should have anticipated that some users would see a Checkout credit as nothing more than an extra step of a different (and annoyingly self-serving) kind. Our bad.

Among the changes they are making, Google will now offer a full refund to anyone who purchased a video, will allow users to continue to watch their videos for another 6 months and will also allow you to keep the $2.00 Google Checkout credit you’ve received.

This will no doubt make people much happier, and I believe, as I’m sure many others do, that it’s always good to see a company admitting they made a mistake and fixing it.

One thing that this does entire story does make you think about (which I thought PC Mag’s article captured quite well) is how this kind of thing really could happen. Google is a giant and therefore decided that based on the negative feedback it was getting they would remedy the situation - so more time to see your movies, a full refund and an additional credit for you. But what if this wasn’t Google? What if a video company or picture uploading site or blogging service that you had invested your time, uploads, content or writing to just went under? If they didn’t have the power of Google to give more back, where would you be?

All that said, I firmly believe that this is the nature of the evolving digital marketplace. It’s happened with other industries, that’s just the way it goes. In order to make things happen you have to try new things out. Way back when Google decided to roll out its own video service along with this DTR/DTO functionality, nobody had a clue on how to monetize video online. Surprise surprise, no one has really figured it out now either. So while there might be some repercussions that come along with this type of experimentation, there are still benefits that come from it. Now in this particular example the negatives are exacerbated because of the fact that users’ money is involved, but think of all of the benefits that come from companies like Google experimenting (and often failing) in the online sphere and developing (mostly) free products for folks to use. I think dealing with some failure is a byproduct that, in the end, most people are ok dealing with. The above blog entry from Google actually ends with a similar thought.

We make mistakes; we do our best not to repeat them — and we really do try to fix the ones we make. That said, the very least that our users should expect from us is that our mistakes be new and innovative, too.

Sure, there is a certain degree of spin on everything. But putting it all into perspective, I think these are things that we as users of the magical interwebonlineportalspace should not only expect, but embrace.

Now for some changes to the Google Video service as a whole…