Flipboard, Apple, and why a single channel distribution is a scary place to live
I like Flipboard. It's very well executed and quite cool. After a rough first day scaling-wise, they are the talk of the digerati. There are unknown issues regarding the appropriateness of content scraping rather than using syndication feeds, but I will leave those conversations to others.
Flipboard raised a boatload of venture capital -- reportedly $10.5 million -- from very top tier firms. It got me thinking about what the due diligence must have been like, especially in terms of competitive analysis. I am not seeing many barriers to entry for a whole slew of competitors. The application itself is clearly the descendant of Pointcast, a late 1990s screen saver that stylishly fed you headlines and data (in a snazzy, late 90s kind of way). There is a screensaver built into macOS (RSS visualizer) that is reminiscent of what Pointcast built. It's like a tablet version of Pointcast, with some social media spin thrown in. There is no real reason that many others could not pretty much clone what Flipboard has built.
The one competitor I would be worried about is not a start up. I would be worried that Apple likes the application so much that they build a version of it right into iOS. Think about it for a moment. This is a core tablet app. It takes the web and feeds and formats it in a manner optimized for tablet consumption. Now roll into the mix that this is an iPad app, and Apple is the sole distribution channel for the software, and you have got a potentially perilous situation.
Apple could offer to buy Flipboard, but as Apple is the only distributor, they would have a ton of leverage in the price negotiations (and if you raise 10.5 million, your investors are expecting a grand slam). Say Apple offers to buy Flipboard for $10 million. Flipboard would naturally say no that offer (they probably raised money at a $40 million post-funding valuation). Apple says fine, clones Flipboard, rolls it into iOS and then pulls Flipboard from the app store because it duplicates iOS functionality.
At the end of the day the content scraping issues may be the least of their problems.