Apple & HDTV: Shifting from Domination to Delight

| Hidden Dimensions

A poem begins in delight and ends in wisdom.” — Robert frost

There was a time in 2011 when we had a feeling that Apple might be able to deliver a new kind of TV viewing experience. It would be so good that we would gladly cut our cords. The cable and satellite industry would be embarrassed. We would be in Apple Nirvana. Now, however, that ship has sailed. Something else is emerging.

I have gone through various stages of consciousness on the Apple HDTV project and what it might mean for customers. The focus has been on how Apple might alter and control the fundamental viewing experience by controlling the content. It seems fairly clear, after a few years of negotiations by, at the time, Steve Jobs, and recently, Eddie Cue, that the Hollywood and network content providers are bound and determined to set their own agenda on who gets certain content rights — and how much.

I asked Phillip Swann of TVPredictions about that. He agreed in an email: “I don’t think Apple missed the boat so much as they haven’t been given a chance to buy a ticket! The content owners aren’t interested in giving Apple what it wants — the ability to sell programming in any form it chooses. And they won’t hand that to anyone! They want to dictate how their programming is sold because it preserves its value in all agreements.”

Diversity Rules

TV DelightOne of the other basic problems is that every different person has different preferences. For example, I sense that only a few of us, the distinguished Peter Cohen at The Loop and I, for example, have a seemingly bizarre simultaneous appreciation for FX’s Justified and PBS’s Downton Abbey . That’s just the tip of the iceberg when it comes to viewer preferences that are scattered over an N-dimensional space. As a result, with all that diversity, controlling the content in order to control the user experience doesn’t seem to make sense, if it ever did.

Another problem that Apple faces is the diversity of technologies on the Internet. Modern video technology, the ability to put a 1080p and Dolby chip on something the size of a U.S. quarter allows just about any company to jump into the video distribution game on various terms. Because of that, Apple’s delay has been both harmful and beneficial.

On one end, you have Intel, worried about its PC business, moving into the set-top business. On the other end, you have the Aereo TV service launching in New York under Chet Kanojia. In between, every content owner/creator has an app to cash in on some residual revenue, but on its own terms.

When It comes to moving from control of the user experience at a detailed level to a higher level abstraction, I am inspired by the quintessential analysis of our Ken Ray: “Apple TV: Growing from Appliance to Television”. In his brilliant essay, Mr. Ray lays out the argument that, without extensive rights to content that would supplant our need for cable or satellite TV, the real challenge is to bring a higher level of coherence via iOS, the iOS app, and the wireless interface to an Apple HDTV.

In other words, one recognizes the diversity of choice, but also the need to provide people a way to organize that diversity. One way to do that is to exploit the iPhone or the iPad as the next generation set-top-box and then transmit that information to a nicely complemented Apple HDTV.

By complemented, I mean, for example, the Apple HDTV has built-in Wi-Fi and iOS as its primary display. You won’t have to fuss with figuring out which HDMI input corresponds to each device, say an Apple TV. The TV does that for you.

This transition from using Apple’s muscle, in vain, to arrive at content agreements that lead to Apple’s control of the overall experience to the more subtle use of synergistic Apple technologies is the key to Mr. Ray’s insightful analysis. It can potentially lead to that “ah-ha” moment, just like we had with the iPad in 2010. At the surprising and timely moment, we realize that we’ve found the Holy Grail for a new way to watch TV with the help of Apple technical genius. And that may not necessarily mean cutting any cords.

Some Concerns

My worry is that Apple, as a very large company, may be a bit more heavy handed than we would like. No CEO likes an initiative to fail, especially one started by a co-founder like Steve Jobs. The tendency of any large company is to use its power and influence to force issues for its own benefit and to vindicate its motives. Shifting gears quickly is hard.

When Steve Jobs was fully in charge, the tendency was to push hard and move relentlessly forward, embracing the very latest technology. That is Apple’s signature. We, as customers, pay good money to be on the science fiction bleeding edge. But it didn’t work with the content providers. For example, there was the recent story by Bryan Chaffin about an encounter between Steve Jobs and CBS chief Les Moonves that didn’t go Apple’s way. And it’s not going Apple’s way any time soon.

Apple has taken its sweet time with this HDTV adventure, and that has both worried us and the competition. We went from incredulity, at first, to hopes that Apple could take a bite out of the conventional TV business. We thought that maybe Siri or some other magic, combined with content agreements could put Apple at the top of the TV industry. Perhaps Apple would buy the Disney Co. and break into the industry by force. That subliminal community consensus reached its peak at CES 2012 where it was clear that every sector of the TV industry was scrambling to avoid a coup by Apple.

What’s Next?

The good feeling I get is based on what we’ve seen so far from Tim Cook. My sense is that we have a leader here who takes a common sense, practical approach. This HDTV delay has been helpful so that the new leader can sort things out. The incremental improvements in the Apple TV 3, the iPad 3 and Mountain Lion suggest that while advances in technology are always pushed, alarming and annoying the Apple customer — as a price to be paid for the bleeding edge — are now off the table.

What’s at stake now is something both less grand and more subtle. Apple can carve out a handy niche for iPad and (perhaps) Apple HDTV owners as a kind of convenient top-level home management system. Dealing with complexity and diversity with technology instead of seizing content control is called for. A good plan doesn’t entail cord cutting as much as it means embracing what people already love abut Apple products and intelligently merging them.

Who knows? Something may come of that. Serendipity could strike. Apple continues to build on technologies in a synergistic way so that, as Mr. Ray said, the company is poised for the “ah-ha” moment that a splintered TV industry will never see coming.

I just hope that this is where Apple is headed. I’d hate to see Apple try to force the larger issues that we’ve seen them deal with over the last year. For all its might, Apple has learned that it cannot have its way with the TV industry. What we hope for now is that which we’ve come to love about Apple: they make technology just work for us in service to us. Others, not Apple fans, may or may not travel our path, and their predilections will take them down a different road, with all the Internet and TV industry has to offer. That’s fine.

We want Apple, under Tim Cook, to keep focusing on is us, the customers. We’ll be happy with that. World domination can wait.

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Image Credit: Shutterstock.

Comments

iJack

Thanks for another good article, John.

I find nothing at all bizarre about enjoying the perceived extremes of Downton and Justified.  I watch both religiously, as well as a bunch of others that “don’t fit.”  Both are well written and have engaging characters played by accomplished actors.

IMO, those that focus on things outside those parameters are navel-gazing.

Chronologic

Short and sweet.
Apple is focused on long term innovation.
This is not a new challenge.
They have a few killer plan Bs.

Let’s be honest, film and tv shows are old school “non-interactive” media.
Not trying to be a prophet here, but look at the growing interactive media business. It has growing like mad, then consider what the iOS devices have done for gaming. Mainly mobile, but it is just the beginning…
We have seen this strategy before.

Bottom line, that is what they are reinventing…the new tv box
The movie/tv guardians will come begging later.

You are right, it isn’t about global domination. Apple’s twist and MO is to reinvent our future.

aardman

What amazes me about the whole Apple phenomenon is the extent to which people are willing to give up content if that’s the price of owning and using an amazing device, or family of devices. i.e. “If I can’t enjoy it on my iDevice, then I’m not interested in it.”

HiFi Audio as a mass consumer product is dying because of this, brick and mortar cinemas are following closely behind, and I suspect cable, satellite and broadcast TV as well, as manifested in the declining trend in hours of TV watched.  Cab & Sat might not be feeling it yet because so far it hasn’t hit their subscriptions that badly, but as TV viewing time keeps on falling, eventually people will decide Cab & Sat aren’t worth the expense.

And it’s a testament to the cluelessness of the theater and Cab/Sat execs that their response to this is to make their products more expensive.  People already are staying away from cinemas and your response is to raise ticket and popcorn prices?  Or, we’ll let you watch programming on your iDevice but you have to pay for it ON TOP OF your Cab/Sat subscription.  Well, sometimes it’s “free” but there just happens to be a contemporaneous increase in the cable subscription rate.

wab95

Enjoyable thought piece, John.

However, I am not persuaded that we have seen the back of Dreadnought Apple. Indeed, those who cross the intellectual property line of its territorial waters are likely to find themselves on the unhappy business end of its cannons.

That said, we may well be entering a new chapter, under a new captain, of a kinder, gentler Apple when it comes to influencing (disrupting) new industries, one that resorts to gunboat diplomacy as a last resort but instead opts first for negotiated settlements. Even this, given its history and painful rebirth, is likely to be less Neville Chamberlain, seeking appeasement in the face of adversarial aggression, and more Teddy Roosevelt, speaking softly but carrying a big stick. Indeed, Apple’s current execs appear to follow Roosevelt’s admonition, “Don’t hit at all if it is honourably possible to avoid hitting; but never hit soft”.

Apple’s penchant for identifying important novel technologies, and buying up those that it does not invent, whether or not there is an immediate application for them, is a function of its long-game approach to shaping the future.

The behaviour of the entertainment industry, television notably, is reminiscent of a gaggle of squabbling penguins taking refuge on steadily shrinking ice floe, noisily jabbering at Apple’s dorsal fin breaking the water, as it circles, orca - like, waiting for just the right moment to strike. Unlike the TV industry who seem blithely unaware that the changing climate around them will inevitably dissolve their refuge, Apple continue to deploy technologies and partnerships that will put them in prime striking position when the time comes - and the TV industry, like the penguins, are unlikely to ever see it coming.

I, for one, care little about the far term fate of television, given that I watch so little of the broadcast variety that I can count my weekly viewing hours on one hand, but am intrigued at the thought of how Apple might reshape it to something more accessible (and affordable?) than it currently is, enhancing the user experience, which is the sine quo non of its handiwork. However, Apple having emerged as an industrial superpower, as all superpowers must, will need to carry her newfound, and perhaps unexpected, power responsibly; choosing her battles with the same strategic judiciousness with which she pursues technological innovation, and instead, appealing to mutual interests and creating novel alliances, to achieve her goals.

We live in Interesting times, indeed.

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