The Apple television is an old rumor, one that refuses to die, which, if the past is any indication, leads me to believe that there is some truth in it. The problem is that Apple already has a product called the Apple TV and that is not what this rumor is about. This latest rumor is about a real physical television set. The kind that most of us call the idiot box.
The current Apple TV is a small set top box that lets one buy and stream content from iTunes. A few years back, before Apple released this product, a set top box with a built-in DVR is what the rumor mills predicted. They got a set top box but without a DVR.
The Apple TV is a sleek unit that lets you in to Apple’s walled garden with the finesse that only Apple can match. It also lets you play content from any of your other iDevices using Airplay. It’s not perfect, but it works. And that is where the problem lies. It is one of the few Apple devices that is designed to work with products from other manufacturers. Infact, it depends on a television that Apple doesn’t produce… yet. You know the kind of television sets that companies such as Samsung produce.
Let’s talk about the latest Apple TV rumors now. The rumor mill is now predicting a new Apple product that will be an actual television set. Not a set top box, but an actual physical television set. That’d, I presume, remove use for the current Apple TV. Now, I see why Apple would want such a product, a) They hate depending on other manufacturers and b) If Samsung, LG and the like can make a TV and profit from it, they can damn well do it too.
Both a) and b) are valid reasons for Apple to jump into the television market but herein lies the problem.
The television market is not a very profitable market. It takes a huge amount of investment to manufacturer television sets, which is not a problem for Apple, but the margins are wafer thin. The game of wafer thin margins is not one which Apple likes to play.
The other problem is differentiation. If you’ve tried buying a television in the last few years, like I have, you’d realize the amount of choice the consumers have. So much choice, in fact, that it’s virtually impossible to distinguish one set from the other. Now, you may say, that this is a problem that is right up Apple’s sleeves, and I’d have to agree with you but I’d also have a counter point to that saying that while Apple may be able to distinguish them from the other manufacturers, how are they going to sell their TV to a consumer that might not want to upgrade it for the next 10 years. Will it even be worth it for Apple to setup a huge supply chain, make room in Apple stores and employ armies of support staff for installation and troubleshooting of TVs to sell a device that a customer buys once in 7-10 years?
Why wouldn’t Apple continue to invest in the current Apple TV ecosystem, make it the best set top box in it’s category, add DVR like features and open up the platform to third party apps ?