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Summary:

With Sony announcing a DVR for the PS3, what are the odds Apple will make a similar move?  Sony and Apple are very different companies. What drives Sony may not drive Apple. These days, Sony seems lost.  They missed out on the digital audio player market after […]

With Sony announcing a DVR for the PS3, what are the odds Apple will make a similar move?  Sony and Apple are very different companies. What drives Sony may not drive Apple.

These days, Sony seems lost.  They missed out on the digital audio player market after being the dominant player in the portable audio market.  The PS3 has not been warmly received.  The XBOX 360 was given a one year head start and is hitting its stride while the PS3 languishes.  The Nintendo Wii is the darling of the casual gamers with its low price and is the antithesis of the PS3 in styling with its compact white form-factor as opposed to the PS3′s gigantic black curved box.  Sony is trying desperately to make the PS3 the only set top box you need in your entertainment center.  It’s a gaming machine, a next-generation DVD player, and will soon be a DVR.  The PS3 is either a jack of all trades or is having an identity crisis.

Apple hasn’t seemed lost in years.  It is the leader in the DAP market and has quickly become a major player in the cell phone market.  With Apple dropping “Computer” from its name, Apple is clearly focused on the consumer electronics market.  So why would Apple even bother adding a DVR to its lineup of gadgets?  The argument against an Apple DVR is simple.  Apple and studios make money when people purchase their shows or movies from iTunes.  A DVR would diminish purchases from the iTunes store.  Plus, the iTunes DRM locks the content to Apple products like the iPod or the Apple TV.

The Apple TV

However, there is one thing that makes me think that Apple could easily come out with their own DVR.  Apple is a hardware company.  The Apple TV, Apple’s hobby, is the most likely candidate for DVR functionality.  The device was quickly upgraded with a larger hard drive and new software features.  Why would Apple bother negotiating with television and movie studios for content when Apple could just make a device that records content?  Apple could easily add the same DRM to keep Apple recorded shows on Apple products.

There is one thing I can’t shake.  Has Apple ever added such a major function to any of its preexisting products?  The iPod may have changed in physical dimensions, added a color screen and revised its clickwheel, but it has not added major new features (other than video playback).  The iPod still lacks an FM tuner, wi-fi and bluetooth even though many competitors have these functions.  The iMac has been through several aesthetic changes, but once again, the all-in-one computer is still just an all-in-one computer.  Apple’s products do not normally evolve into new products.  Apple is a company that jumps from one product to the next (look at how they killed the iPod mini for the iPod nano).  This suggests that if Apple were to do a DVR, it would not be an upgraded Apple TV, but some other product.

Maybe not…

I do not think that Apple would come out with a DVR of its own.  Apple is on a course to become a content provider like Comcast or DirecTV.  Their iTunes model is similar to buying cable a la carte.  If Apple has a direction, a DVR would be a step in the opposite way.  It appears as if Apple sees content coming through downloads and not from recording television programs through traditional content providers.  Just as Apple has declined to enter the bargain basement PC market, Apple will most likely decline to enter the DVR market.

  1. Iyaz,

    Why would Apple bother negotiating with television and movie studios for content [...]

    I question whether the television industry has come close to embracing DVR systems. They fought the VCR back in the day with the same apathy and nonsense.

    As far as the industry is concerned, they prefer the current AppleTV purchasing structure far more than DVR functionality (obviously). If anything, adding DVR would only hurt Apple’s current deals with networks that monetize their programming on iTunes.

    The ancillary markets are a huge new revenue stream for standard television content producers — I can’t see the major players not voicing their opinions on the subject to Apple.

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  2. Geminicricket Tuesday, August 28, 2007

    Just a thought, take a pole of the mac users to see how many have a dvr. I suspect that most mac users have one even though Apple doesn’t offer one in their line up. Apple seems to think that they can move the consumer rather than the other way around. Don’t get me wrong I like apple products and am a stock holder. However, they nor any other company will be able to persuade me, and I suspect a large number of dvr owners that anything but a dvr will suffice for the way I/we view television. This is especially true when you figure the extra costs in the way Apple wants you to buy content. I think if they are to tap into what the consumer wants they better get on the dvr bandwagon or risk losing and alienating many customers.

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  3. I doubt Apple has any plans to do anything with TV programming other than sell it through the iTS.

    I follow three TV shows, and luckily for me, all three are available in the iTS. Buying them there gives me the convenience, speed, organization, and price DVR simply can’t match – all that without the added distraction of dumb TV programs. I could choose not to watch those if I had cable, but few people’s will powers can resist it.

    Between those shows and podcasts, I watch about an hour of TV per day. It costs me less than $15/mo. Maybe I’m not a typical consumer, but I’m a happy one.

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  4. DVR is cool. DRM is not.

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  5. DRM may not be cool, but if Apple can offer the selection cable can in an a la carte fashion why not buy your shows, in my case it would come out cheaper, and I watch a decent amount of TV.

    The only problem Apple has with their current model is Live TV (breaking news, live sports, etc.)

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  6. Apple consumer electronics products are about shifting the power away from the current middlemen in entertainment (the distributers) and putting the power back into the hands of the artists.

    The only way to do that is to bypass them. iPods bypass FM stereo, turning the iTunes store into the new taste-maker.

    AppleTV bypasses cable and satellite providers.

    The iPhone, with its WiFi capabilities is poised to kill the cellular networks.

    The iTunes store is just the first to feed these boxes. YouTube is the second.

    Joost and Slingbox are helping bridge the gap.

    On Digital Rights Management Code:
    DRM, regardless of what store you get it from is a STUDIO decision, not a vendor one. If given the chance ALL music and video stores would go DRM-free tomorrow. It just adds cost and complexity, benefitting neither the store nor the customer, only the seller of the DRM code.

    That why Apple wrote their own. Why lose half of the 3 cents per track you’re making to a DRM code vendor royalty, when you employ teams of coders?

    DRM is the monkey wrench keeping net-distribution from completely killing traditional distribution models.

    It’s a necessary evil, because without it the studios won’t allow their artists to sell their product at those stores.

    So its a race between artists dumping studios and studios dumping DRM.

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  7. [...] the iTunes DRM locks the content to Apple products like the iPod or the Apple TV. (more…) … Read More… This entry was posted on Tuesday, August 28th, 2007 at 11:00 pm and is filed under Uncategorized. [...]

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  8. “Apple hasn’t seemed lost in years. It is the leader in the DAP market and has quickly become a major player in the cell phone market.”

    On what basis do you justify this comment? $ sales, amount of units shipped? Cool factor?

    Apple is not a major cellphone player YET, for now its single cellphone product is a small fish in a very big pond. Think about this statement again, when iPhone is shipped outside of continental US, and can compete on the world stage directly with the likes of Nokia, Ericsson, et al.

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  9. 1. Apple TV needs IPTV, not DVR capabilities.
    2. The PS3 is an amazing piece of technology, well worth $500.

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  10. Put an ATI or nVidia graphics chip in a Mac Mini with a SuperDrive, shave a little bit more off the price and market it as a games console that will do everything. EA have just started making games for Mac. Xbox would get blind-sided. PS3 would not even get a look in. And Windows would have to start getting better to compete.

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