Blog Post

The New Apple Model: Cheap Player, Expensive Remote

What’s the real price of admission for the new Apple TV (s aapl)? How about $300 U.S., give or take, not the $99 it says on the box? That’s factoring in the cost of the entry-level iPod touch, which is the least Apple is hoping you’ll be buying in addition to its new living room media player. They say marijuana is a gateway drug; meet Apple’s new innocuous gateway gadget.

The key to Apple TV’s addictive potential? Another recently introduced Apple product, albeit one that’s harder to put a price tag on. It’s AirPlay, the re-imagined AirTunes successor that allows Apple’s iOS devices (as of version 4.2, due in November) to stream video or audio content to the Apple TV, and therefore, to your connected home stereo or television.

Without it, you’ll be paying Apple for the privilege of streaming all your content, since the new Apple TV doesn’t really have any onboard storage to speak of. If you choose to go that route, I’m sure Apple will be pleased, but I’m willing to bet (and I’m sure Apple is too) that the majority of customers will opt to stream their media from their own existing sources most of the time. Which means having something to stream from.

According to Apple’s own website, video won’t be streamed from computers to the Apple TV, only pictures and music. That means you’ll need at least an iPod touch just to start streaming video from your own sources. Of course, an iPod touch also makes a great remote. So Apple’s turned around the normal order of things, and made the storage device the controller and the player itself little more than a conduit.

It’s a risk. Most obviously because consumers could fail to see the link, or just refuse the price of entry that comes along with an iPad, iPhone or iPod touch and the Apple TV could fail utterly without affecting sales in the mobile silo at all. But it’s a risk Apple can take. The Apple TV wasn’t ever a star in the company’s lineup anyway, and even as a $99 Netflix (s nflx) box, it’s bound to have at least some success.

Apple may be waving its hands and pointing to Netflix and 99-cent rentals as the major selling points for Apple TV, but the sleeping giant is AirPlay (and maybe the iOS powering it, too). Watch the reviews when it hits living rooms; there won’t be one that doesn’t mention how simple and impressive watching your media via an AirPlay-connected iOS device is. That’s when it’ll become apparent that Apple’s living room strategy is really just another part of Apple’s mobile strategy.

Related content from GigaOM Pro (sub req’d):
Where is Cisco’s Living Room Strategy
Strategies for the Future of Home Storage
Got a Cable Subscription? There’ll Be an App for That

22 Responses to “The New Apple Model: Cheap Player, Expensive Remote”

  1. When I read this last week I immediately thought “surely this author is wrong”, but I held off until I got my apple tv in the mail. I can now say that I know that the appletv pulls video off my computer and my computer can push video to the apple tv. I don’t know what he was thinking, and I don’t know why this article doesn’t have a great big “UPDATE:xxxxx” across the top to fix the obvious flaws.

    I just removed TAB from my feeds. They have been an alsoran to TUAW for a long time now.

  2. I too agree with all of the commenters. This is the most ridiculous article. I am very happy to read the backlash and hope that this opens the eyes of the publishers. Just look at the quality of readers you have here. All very willing to point out a mistake and sad to see the site go down the toilet. Not even a single troll here. Compare your readership to that of engadget and reevaluate your methods. Sincerely, a reader of 4 years and counting. Figure it out.

  3. Shardsofmetal

    So when you did your research for this article, as I would expect any blogger to do before posting an article to a blog with this many readers, you should have saved the link to the Apple page you from which got your information, and put it in the article. Without it, and with multiple Apple links contradicting what you said, this whole article is rendered useless.

    Another point worth making, the audience most likely to purchase an Apple TV has already purchased and iPod touch or iPhone, and won’t have to buy it again, further rendering this article useless.

  4. “According to Apple’s own website, video won’t be streamed from computers to the Apple TV, only pictures and music.”

    I cannot find any statement made like this. I read clear references to music streaming, then some not-so-clear references to streaming media from PC or Mac.

    Can you clarify? Where did you see the statement that resulted in your comment above?

  5. Mark Hernandez

    I came here to let Darrell know I think his writing is the pits. I see I’m late to the party.

    Darrell doesn’t care, and apparently neither does Om Malik.

    Darrell, you’ve done great damage to GigaOM’s reputation, and irreparable damage to your own.

    Mark Hernandez
    The information Workshop

  6. I think the Apple TV is targeted at people that already own at least one iOS device. I cannot wait to get mine in the mail to stream movies from my iDevices.

    I recently started reading the site and the iPhone app is one of the best as far as blogs go. I like having all of the articles are in the same feed.

    It is amusing how many of the articles are so bad like the clown trying to make ATT look bad because he is constantly texting, emailing, tracking his location on 20 different worthless location based services and then complaining that he already used 3 GB worth of data on his iPhone. It was apparent from that article that this site hires teenagers.

    I however am not leaving the site because there are some descent articles on GIGAOM.

  7. Yet another example of sloppy journalism. This entire article’s premise is based upon the author glancing at one sentence in the AppleTV page and making a wild assumption, without bothering to verify it or even check if the rest of the page contradicts the assumption (which it does). I’m sorry, Apple Blog, but it’s time I unsubscribed from your rag.

  8. I agree with the other posters that say your argument is flawed, but I think you’re missing the bigger picture here: the price of admission also includes an HDTV, since normal televisions apparently aren’t worthy of el Steve-O’s grand vision for his latest hobby.

    • This is just very forward thinking by Apple. Most TVs have an HDMI port now, even the tiny one my mother bought from Walmart. By limiting Apple TV to HDMI, Apple was able to limit the number of ports and make the device that much smaller and cheaper to make. It’s very typical of Apple to cut off old technology. It may cost them a few sales, but the net effect is a better, cheaper easier to understand device.

  9. That’s it, I give up. Somewhere along the way this blog crossed the line between critical and deceptive link-bait. The primary fact behind this article – that the new appletv won’t stream local content from a PC or Mac – is deomstrably false. Not only does Apple’s website not make the claim Darrel says it does, but steve jobs DEMOd it ONSTAGE.

    Since I find it hard to believe that Darrel or TAB as a while would think it appropriate to write this article without having done the barest level of research (watching the keynote, or reading ANY of the web pages about appletv for example), I am left with a belief that this is intentionally false. Yeah – I’m calling you a liar Darrell.

    Goodbye TAB – hopefully Om figures out how worthless you’ve become.

  10. Interesting. You would think people would go nuts to find out that you wouldn’t be able to control the AppleTV from an iOS device. But, what we have here is someone who turns it into a money motive, as oppose to Apple just doing what is obvious. If they didn’t do it people would harass them, and even we they do what we want, they still get harrassed! I feel bad for Apple sometimes, people force them to be perfect.

  11. For 10 years or more, Apple has shown over and over this maxim: An Apple product works great; but it works even better with other Apple products.
    For all those people who’ve already got an iPad or an iTouch, the Apple TV is a logical step to cut the cable chord. With iTunes, it just works.

  12. Yes, you can still stream video from computer to apple tv. To quote apple tv site

    You can already stream music and video from your computer to Apple TV. With AirPlay, you can stream music and video from your iPhone, iPad and iPod touch too.

    Kinda renders this article irrelevant

  13. Apple’s website clearly says in both the Apple TV product overview and Specs that streaming from Mac or PC would be enabled via AirPlay. Not sure where you got that it said iDevices only, but that is a pretty misleading error and should probably be updated.

    • It is kind of sad that I have come to expect this kind of error from the Apple Blog. When this blog first went online I thought it would be a great source for info, but it has become a glorified page hit manufacturer. I find myself coming here just to see how misleading and wrong the reporting will be as much as I do for news and opinion.

      I mean every time I read one of these posts by Darrell Etherington post it is either misinformed gibberish, or the most awful prediction in the world. Yesterday’s post on how cases with built-in keyboards are going to be the key to the iPad really being a success was plain awful and showed a total lack of understanding of the current computing ecology.

      In the end, the best part of the Apple Blog is now the cadre of readers that call out the writers for their mistakes like the above two posts. How sad.

  14. “According to Apple’s own website, video won’t be streamed from computers to the Apple TV”

    except here:

    Give your digital collection some airtime.
    Those movies and TV shows you bought on iTunes don’t have to stay on your computer. For maximum entertainment, stream your digital collection over the air to your Apple TV. Just don’t forget to call dibs on the recliner.