Podcast Audio | Posted by Phil Leigh on February 13, 2009
If you would like to learn how Apple might take center-stage in the digital living room, this audio is for you.
Following our February 4th post about how the Mac Mini might be modified to provide Internet-Video-to-the-TV, there’s been a flurry of speculation about the company’s potential to enter the TV set business in a couple of years. The idea is that Apple would enter the category with a game changing product concept much like it did in the cell phone business with the iPhone. It’s not a bad idea.
However, much of the justification for an Apple Television discussed in the press centers on the company’s ability to leverage the iTunes store and add a DVR. There’s nothing wrong with the notion, except that it misses a bigger point, unless free podcasts of most TV shows and movies at places like hulu are also at iTunes.
In our analysis the critical asset for an Apple Television would be a graphical interface that can be controlled by a simple remote combined with an applications platform much like the one for the iPhone. The applications platform will be crucial since consumers are going to be naturally resistant to limitations on Internet Video content. For example, they’re going to have a decided preference for free viewing at ad-supported websites. Such a platform will enable websites that want to be easily accessed by Apple Television users to join the Apple ecosystem.
For example, a future Apple Television platform will likely come pre-loaded with hulu.com, YouTube, abc.com and other popular video destinations. But if sites like Veoh and Blip.tv want to be included, they’ll be permitted to develop their own apps.
In short, if an Apple Television comes to market it will likely have an interface and platform much like Boxee is already offering. Unfortunately for Boxee, it will likely be developed by Apple itself.
Such a product would be an undeniable game changer for the TV set manufacturing industry. Incumbent manufactures like Sony, Panasonic, Sharp, Samsung, LG, and Vizio will find it hard to compete. They’ll have to develop competitive interfaces and platforms. But few developers are going to want to focus on their platforms once Apple jumps into the lead. The situation will be much like it is today with the iPhone.
If most of the apps are developed for the Apple Television then most of the Internet Video will be available only on Apple’s unit and not competitive ones. In such a scenario Apple Television will become the center-of-gravity for consumers wanting to watch Internet Video on TV. Competitors will steadily lose market share.
Apple’s competitors should fight back now in two ways. First is to unify around a similar platform as a standard (e.g. Boxee) and introduce products that use it. Second, is to immediately start promoting the laptop computer as a Media Controller for flat panel TVs.
Specifically, consumers are discovering that flat-panel TVs conveniently mate with laptop computers. Thus connected, the laptop WiFi connects with the home router and thence to the Internet. In such a configuration the TV functions as a giant monitor for the laptop thereby permitting any Internet Video or website to be viewed. Essentially, the laptop becomes a Media Controller. A remote mouse and keyboard completes the scenario in an entirely comfortable lean-back experience from the living room sofa.
There are four reasons why consumers select laptops, as opposed to alternate devices, for TV-to-Internet hook-up. First, they provide unlimited access to the Internet. Second, they are commonly available. Third, the laptop is surprisingly inexpensive compared to alternate appliances, especially considering its general-purpose capabilities. Fourth, since consumers have been surfing the Web for 10 – 15 years, they are comfortable with a browser.
Computer makers also need to promote the Media Controller application or watch this potential Killer App drift away to Apple Television. First, and foremost, Dell, Sony, and H-P need to offer more laptops with HDMI sockets. All laptops capable of processing HD video should have HDMI sockets.
This is Third Generation Television.