11 Comments

Summary:

A dedicated Apple TV set was a hot topic at the end of 2011. So far in 2012, news on that front has been relatively quiet, but a new note by longtime Apple TV set booster and Piper Jaffray analyst Gene Munster is reigniting the discussion.

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A dedicated Apple TV set was a hot topic at the end of 2011, spurred mainly by comments Steve Jobs made in his official biography by Walter Isaacson. So far in 2012, news on that front has been relatively quiet, but a new note by longtime Apple TV set booster and Piper Jaffray analyst Gene Munster (via Fortune) is reigniting discussion Wednesday morning.

Munster claims discussions with a “major TV component supplier” which had been contacted by Apple about its TV display parts lead him to believe Apple is still on track to introduce a dedicated television device in late 2012. However, there’s a caveat: Munster thinks if Apple can’t get a revolutionary new content model in place, then it won’t move on the market this year.

The analyst then goes on to suggest three possible scenarios that might constitute a unique Apple approach to the television market. Those potential solutions break down roughly as follows:

1. Changing the experience, not the service

In Munster’s first scenario, Apple would basically leave TV programming to existing operators and simply layer its own interface software on top, including menus, guides, DVRs and content discovery. Munster notes that Apple was expected by some to manage its own wireless network in the U.S. ahead of the iPhone launch, but instead partnered with AT&T and focused on UI and UX instead of content. Remember that apps came after the iPhone’s original introduction.

2. A hybrid content model

Apple could also partner with existing networks to offer live TV, and at the same time, deliver on-demand content from providers like Netflix, Hulu Plus or any other content partner willing to play via an App Store-style distribution channel, Munster suggests. It’s a “best of both worlds” type solution, and would probably still come complete with an overhauled UX, but might be trickier to negotiate than option number one, since it involves negotiating with two different types of content providers.

3. A la carte

Munster’s last option is a completely customizable, a la carte option that would see users subscribe to live TV packages from content providers. This would be the most revolutionary of the options in terms of the existing TV experience, but it would also involve a dazzling shift in the way providers make their content available, and the negotiations involved in doing so would be challenging, at best. In the end, there’s also no real guarantee that selective programming is what viewers are after, especially if existing, less flexible bundles from other sources cost less.

GigaOM’s Ryan Lawler wrote last year that Apple’s television effort was more about experience than about content, and described a likely outcome of Apple’s TV endeavors that pretty much mirrors Munster’s second scenario listed above.

Given the challenges involved in negotiating the third solution, I have to agree that a system that works with existing content sources, but also opens up the possibility of apps for different kinds of content makes the most sense as a solution that could still make big waves in the TV industry while also remaining realistically possible in the near-term. Which of Munster’s Apple TV predictions, if any, make the most sense to you?

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  1. Vamshi Sriperumbudur Wednesday, February 1, 2012

    The hybrid content option makes sense. Isn’t that also what Google TV 2.0 all about?

  2. I agree that the content model must change before Apple does anything drastic with hardware. The current offerings on AppleTV are dismal (getting more diverse over time, yes, but the pricing sucks). I’m not sure Apple needs a full TV set though — I’m happy with my current Apple TV 2 box and my existing TV. What I’m not happy with is the current content options. I think a la carte is the way to go AND the movie studios need to get their acts together, digitize everything, and let apple solve the distribution problem (like they did for music) rather than try to put SOPA in place and go around hunting down the Mega Uploads of the world. Mega Uploads would have had a tiny fraction of the traffic if the media was available from legitimate sources. I’d happily pay for a season of my top 3 shows, a hockey game every now and then, a soccer game pack, a movies subscription, etc than pay $100+/month for satellite or cable.

  3. do any of these actually make sense within the context of the TV industry at all? seems like they sound great on paper, but do not work in the actual realities of the industry and its (peculiar) economics.

    1. Good point. I wonder when the TV industry industry business model was developed and if anything about the consumers or the technology has changed since then. :-)

  4. Munster is an idiot.

    Apple might introduce a TV. Or not.

    It might be an OTT service. Or work with cable. Or both.

    Wow. Mind blowing analysis.

    1. Fanfoot’s “Blog Comments for Dummies:”

      1. Strip out all detail and information from article.
      2. Only restate opposing options.
      3. Ridicule the lack of certainty of article.

      Nice analysis of the analysis idiot.

      1. Vlad: You forgot the obligatory use of childish web terms such as ‘LOL’ or ‘Wow’ or ‘Seriously?’ and mandatory ad hominem insults.

  5. Although it is only one of the options, it’s a bit surprising that Apple should look at user experience more than content on a TV, because TV is a lot about content (unlike a mobile where experience and content came together in a nice neat package called the iPhone). Also, as has been famously claimed, Apple’s business model is about “building accessories to iTunes” – and so one would miss the content angle in this scenario. My own take it Apple would pay as much importance to content as it would for the experience. A fancy UI on a TV will impress people, but not for long.

  6. If think Apple will release a TV with build in cable box because its the only way to fullly integrate everthing in one interface.

    So a QAM tv and an IPTV tv. They could be package like cellphones with 3 years contract. Apple could make a deal with ISP for video on demand.

    Forget about any kind of live TV packages from Apple, its not technicly doable for a large customer base.

  7. Rodri Ghinatti Tuesday, February 7, 2012

    Although it is only one of the options, it’s a bit surprising that Apple should look at user experience more than content on a TV, because TV is a lot about content.

    Also, as has been famously claimed, Apple’s business model is about “building accessories to iTunes” and so one would miss the content angle in this scenario. My own take it Apple would pay as much importance to content as it would for the experience. A fancy UI on a TV will impress people, but not for long. They have to do something outside the box like always does.

  8. The only thing i see is that apple is gathering more clients to the Store…the model is simple …once you get in with your payment card…you in wonderland…constantly evolving…new recreations area…music, video, radio, photos…you can put your life in it..and then you locked. So TV is just a new entertainment area…tomorrow it will be …health area, travel, work…with just a single logon and a password you drive your life…What a bright future we’ve been looking for so long…

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