Rumor Claims Apple Entering TV Business - For Real, Yo

| Analysis

 

Apple TV?

Apple Inc. is ready and willing to enter the low margin business of selling TVs, according to an unnamed “former Apple executive” cited by The Daily Tech. If the source is correct, Apple is going to make some TVs, add in the guts for what the company currently calls the Apple TV settop box, load them up with iTunes, and, “blow Netflix and all those other guys away.”

 

All of this is happening in time for a Fall release date, too.

Better yet, the company is going to depart from its usual tradition of controlling every aspect of the design and manufacturing of its products, and plop the Apple logo on top of a TV set provided by a “major supplier (our guess would be Samsung Electronics).”

The unnamed source added, “You’ll go into an Apple retail store and be able to walk out with a TV. It’s perfect.”

Speaking of perfect, in what may be the most fantastic typo ever, the reporter, Jason Mick, wrote, “We expressed credulity that an OEM would allow Apple to cut into their bottom line, but our source aptly pointed out the OEM would be winning even if Apple cuts into their branded sales.”

We suspect Mr. Mick intended to say “incredulity,” because it would indeed take a fair measure, if not an over-abundance, of credulity to swallow this story. For those inclined towards the curious, “credulity” is defined (by Apple’s Mac OS X dictionary) as, “a tendency to be too ready to believe that something is real or true.” Incredulity is, of course, the opposite, or, “the state of being unwilling or unable to believe something.”

These aren’t the first rumors that Apple was considering making its own TV, but it is the first to be attributed to a supposedly former Apple executive and the first to suggest that Apple would trust the design and manufacturing of an Apple product to another company. The reporter also loses credibility by saying that the current Apple TV settop box “hardly sent sales soaring,” when the reality is that it did precisely that, send sales soaring in comparison to prior versions of the device.

It’s certainly possible that Apple could enter the TV business, but it’s unclear why the company would want to do so. The Apple TV settop box offers Apple reach into any, if not every, living room, and as noted in the intro, the TV business is currently a high-volume, very low margin business. Apple simply doesn’t compete in high-volume, low-margin businesses.

For Apple to disrupt this industry like it did with MP3 players (iPod), smartphones (iPhone), and tablets (iPad), the company would have to offer the public a TV set so compelling they would be willing to pay the kind of prices that Apple has been able to charge for its other products.

To put that more succinctly, Apple’s success has been based on making products so innovative that customers were willing to pay more for them than the cheap crap every other company peddles. Where is the room for innovation in the TV set business?

One such innovation, of course, could be for Apple to deliver apps to the TV (as noted by MG Siegler at TechCrunch). Games, in particular games controlled by iPhone and iPad, could turn Apple into an instant-console competitor.

The reality, however, is that Apple can (and should) do that through its existing Apple TV, and the bigger reality is that Apple would likely want to perfect this concept through the Apple TV before trying to sell a TV made (or at least sold) by Apple.

Mr. Siegler made one more point worth repeating, and that is while the source is supposedly a “former Apple executive,” there are very few “former Apple executives” in the wild, and the ones with direct knowledge of any particular unreleased and unannounced product are fewer still.

Such a leak would be easy to pin down and identify, and Apple takes its Non Disclosure Agreements very seriously.

We have no doubt that if Apple were to enter the TV set business the company would do so with a very compelling product, but this particular rumor is not likely to pan out.

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11 Comments Leave Your Own

Nemo

I was getting ready to buy a TV.  Shall I now wait to see what to see whether Apple will introduce a TV, as I am waiting for the upgrade to the Mac Mini and the MacBook Air?

Lee Dronick

I was getting ready to buy a TV.? Shall I now wait to see what to see whether Apple will introduce a TV, as I am waiting for the upgrade to the Mac Mini and the MacBook Air?

I doubt that Apple is going to get into the TV set business. They may partner with a manufacturer for connectivity between an Apple device and a display.

brian8944

Bryan Chaffin, thanks for that story.  I agree with your logic that while this may eventually be a plan for Apple, they would first want to perfect the technology in their existing hardware, Apple TV. 

Although, in the future, with the integration with iCloud syncing all your Apple products (iOS 5+ and Lion +), this idea could essentually wire all your electronic life with Apple.

Shoaf

I think it more likely that Apple would develop something that would bring us into the “Post-TV-Set Era”. With Apple TV + iCloud, some of the stepping stones are certainly in place.

cb50dc

this idea could essentually wire all your electronic life with Apple

1. I can see it appealing to some hardcore loyalists who just want to have every electronic item in the living room (den, whatever) shining with that lovely little Apple logo.

2. As iPods, iPhones, and iPads have brought in many new Mac buyers, an Apple TV might attract a few more who’ve been on the fence.

3. It gets Apple still more floor space in electronics outlets such as Best Buy, and a bit more presence in Target, Wal-Mart, any store with an electronics area.

4. Finally, along the lines of Shoaf’s comment (above), I suspect they’re cooking up something else, something unique and “GOTTA have that,” for subsequent models. Something that will make other tv makers collectively slap their foreheads with a “D’OH!”

5. It provides TMO with one more topic for wild speculation.

Intruder

Well, it would at least fix Samsung’s crappy DLNA support. AppleTV isn’t DLNA, but at least it works consitently.

MonkeyT

The moment Apple introduces a TV, their reach in the TV market goes from 100% to .01% at best.  Why build a TV instead of use the TV people already own, especially since both the iPad and iTunes will stream video to a destination just like AirTunes already does audio? 

Since they pointedly removed the ability to store video files from Apple TV, I don’t expect them to develop any video ability other than streaming on demand, and they already have the equipment to do that in your hands.  All that’s coming is smarter software.

I want an Apple interfaced DVR as much as anybody, but it looks like as long as they need the Studios help in selling streaming video, recording and archiving video by consumers won’t be a priority.

Ross Edwards

Agreed… no TV.  But it wouldn’t surprise me to see the 2011 fall line of Samsung LEDs with AppleTV integrated instead of the… shall we say “underdesigned” Samsung media interface.

Of course, this leads to hope that Apple will actually shore up the few glaring shortcomings remaining to ATV that can’t be overcome without workarounds (or at all):
1. No 1080p
2. No legacy video format support (or completely current formats like Matroska for that matter, which Samsung’s otherwise-poor media browser DOES support)
3. No media access outside the iTunes database (file browsing)
4. No apps beyond the fixed few (no hulu, etc)
5. No blu-ray, which honestly has become cheap enough that everything should be able to include it now
6. etc

And no, Apple, having to use a $500+ device as an intermediary and a glorified remote control is not a solution (airvideo/airplay).

Minimalists and Apple fans would like nothing more than to plunk down our money and get One Box That Does It All.  Will an ATV-integrated Samsung LED TV, or some device along those lines, finally be it?  It would sure beat the current best option, which is a Mac Mini hacked to incorporate a blu-ray drive.  Expensive and not turn-key.  Not good enough!

Substance

I could see Samsung or someone else building an AppleTV into their next line of TVs and you would have essentially what the article describes above.  But I doubt it will happen.

@Bryan, I’m loving these articles you’re putting out lately.  Reminds me of the good ‘ol “The Mac Observer Spin” days. smile

CityGuide

I can see it appealing to some hardcore loyalists who just want to have every electronic item in the living room (den, whatever) shining with that lovely little Apple logo.

All I want…is the content I want. I have waited for years for a true cafeteria menu of programming selections, and what I have been presented with is what the providers package. The funny thing is, I can get most of what I want on the web, but I have to pay every other provider to get it. If I can get a subscription of the 50 channels of content I really want rather than 500 channels of packaged stuff because the providers think it’s what I want, you bet I’ll go for that Apple logo.  And you know what else I think I’ll get?
- a remote that doesn’t have a two-second delay between button press and action
- A DVR that doesn’t delete previous recordings because the
central office instructed it to do so
- a scheduler that doesn’t get confused with shows that have titles that are almost but not quite similar.
- An interface that doesn’t require “Battleship”-game dexterity to find a show.

I expect a better user experience for the premium prices the providers extract for content. In the past ten years, they have not delivered.

Lee Dronick

@CityGuide

Yes, remotes that are not overly complicated. Too many of them have more buttons than a Pearly’s’ costume.

TVs that have menu buttons so you can change settings without a remote.

No clunky and unreliable decoder boxes from the provider.

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