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.
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