Apple Leads With Its “Hobby” Apple TV

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Still calling it a “hobby,” Apple is leading the market for connected TV players with its Apple TV, according to a report from Strategy Analytics. While not yet a mainstream market, the firm believes that sales will double in the upcoming year.

Apple TV

Research from the company’s Connected Home Devices service shows Apple leading in sales of connected TV players, such as Apple TV or Roku Box. Sales of these devices are predicted to double in 2011 when compared with 2010. And it is expected that total units sold will reach 12 million with Apple accounting for 4 million of those units.

These set-top boxes have not gained widespread acceptance yet, however. Only 8% of US households and only 7% of European households own one. But they provide an easy way to get Internet content onto big-screen TVs and the lower price points of the latest models have made them more attractive.

These devices also enable purchasing of content to be viewed and Apple TV users are doing that more than users of other devices. Nearly a third (30%) of Apple TV users rent movies or TV shows, while on 20% of users of other devices do so.

Jia Wu, Senior Analyst at the Connected Home Devices service said “As Apple prepares for its expected launch of smart TVs in 2012, rival platforms must accelerate their development plans to keep Apple from running away with the connected TV business, as it has done in smartphones and digital music.”

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If Apple can seal a deal with Hulu, I will support Apple’s “hobby” in a heartbeat.

Ross Edwards

BTW, it didn’t really get a mention on the rumor sites, but something Apple did in the last ATV2 software update improved their streaming handling considerably. 

Though the ATV2 already downscales to 720p, it used to stutter on bitrates higher than 1600k or so (movie files bigger than around 2.2GB per 100 minutes) over wireless.  This is not an ATV-only issue; other streaming boxes have run up against the same threshold, including the Xbox 360 and PS3.  It is not an accident that iTunes purchased movie files tend to be well below that size per length.  Compressor is probably a darn sight more efficient than Handbrake, and one surmises Apple eats their own cooking on this stuff.

Last night, I was going to demonstrate this effect for a visitor, since we were talking about whether to wire our houses up for ethernet to solve that issue.  I played the 1080p rip of Fellowship of the Ring from my LOTR extended blu-ray box set, a movie file clocking in at almost 7GB and well into the 3000k bitrate tier, and this time it played without a hiccup.  Smooth as buttah.  I mean it was obviously 720p and not as glorious as the source media, but for casual viewing it was smooth, crisp, and beautiful.  On a much smaller TV, it might have been tough to tell the difference.

Now, I’m not sure whether ATV2 now has the source computer transcode on the fly (seems like that would take a lot longer than the almost-realtime the stream feeds at) or what, but the improvement was extremely evident, and the ATV2 video playback was definitely NOT performing this well before the most recent software update.

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