Interviews with Digital Media Thought Leaders

Will Apple Make Televisions?

Podcast Audio | Posted by Phil Leigh on July 5, 2010

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Unless it enables consumers to conveniently upgrade them without buying an entirely new set, Apple is unlikely to manufacture televisions. Instead it will more probably offer HDTV-compatible appliances that permit abundant Internet access on the TV screen.

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Typically consumers buy a new TV every ten years. Presently a typical 52-inch model costs about $1,200. Presumably an Apple version would add Internet access, memory, and electronic intelligence thereby lifting the price even higher. If it adds as much memory and intelligence as contained in the MacMini, a hypothetical 52-inch Apple television would almost certainly be tagged over $2,000. (The MacMini is an Apple computer typically sold without a monitor.) Given such a price consumers would probably replace old sets at about the same once-per-decade rate.

In contrast, computers are replaced about once every three years for two reasons. First, they normally cost much less than an HDTV. Second, owing to technological progress a new computer is significantly more useful than a three-year-old one. Yet computerization is the primary value Apple could add to a TV set. Consequently a hypothetical Apple television would be vulnerable to technological obsolescence before the owner is ready to replace it. Thus competitors merely offering intelligent appliances for conventional HDTVs could quickly surpass the heart of Apple’s value-added features.

Such a scenario presents Apple with the formidable challenge of holding customers loyal for up to seven years after competitors can offer superior hardware. While Apple may partially succeed by providing an advantageous user interface and be aided by an Apps ecosystem, such factors will not be enough. Much like a seven year old Mac cannot compete with a modern PC, a hypothetical Apple television with seven year old electronic intelligence will be hopelessly outclassed.

Instead Apple could offer a new appliance priced between the $1,000 of a top MacMini and the $230 of an AppleTV. (The AppleTV is a current appliance that most owners use to watch shows downloaded from iTunes. It provides very limited Internet access with a rare example being YouTube.) The new appliance would attach to an HDTV as conveniently as does a DVD-player or video game console.

Crucially, it would offer abundant Internet access in one or two ways. First, could be via numerous Apps much like those for the iPad and iPhone. A second way could simply be via a browser. Like the iPad both ways could be made available, although users would gravitate towards one method or the other depending upon the chosen applications.

The appliance would be controlled remotely from viewing distances customary in the living room. While it would have its own control unit, we suspect the unit will look much like an iPad or iPod Touch. There will likely be a new user interface based upon the touch screens used by those devices. Furthermore, Apple would presumably enable existing iPad, iPhone, and iPod Touch units to also function as remote controllers via downloadable software upgrades.

Confessedly, we have no secret knowledge of Apple’s plans, or absence of them, in the Digital Living Room. The company has proven to be highly innovative in the past. Thus we admit that that it may discover an innovative way to prevent an Apple-branded television from becoming technologically obsolete within the normal ten year replacement cycle, but we cannot predict how.