Apple CEO Steve Jobs had a lot of interesting things to say tonight at the D8 Conference. But to me, one of the most interesting topics he talked about was only brought up by a question from the audience: Apple TV. We all know that Apple considers the device a “hobby,” and tonight Jobs explained why. But he also may have tilted his hand a little bit when it comes to his thinking about this going forward.
Jobs said that the Apple TV is still a hobby because there is a bad “go-to-market” strategy for such devices. In other words, this is basically what I wrote about a month ago: Apple TV will remain a hobby until Apple figures out a way to make money off of it. In the current ecosystem where subsidized cable boxes dominate, that will be very, very hard (just ask TiVo). And Jobs knows it.
But in his answer, Jobs may have also made a little mistake. He clumped in Google with the other device makers who had attempted (and failed) to make a successful set top box. The recently announced Google TV is actually not a set top box — it’s a platform. Yes, one Google TV device (made by Logitech) will be a set top box, but Google TV will also be built in to Sony TVs and Blu-ray players starting this Fall. And that may be just the thing Apple needs.
“I’m sure smarter people than us will figure this out,” is the way Jobs ended his answer. Those people may be Google. You see, by creating a system that is a platform which is built into TVs and resides on top of your current content, Google may have the perfect hybrid model to shake up the broken industry Jobs is referring to.
Jobs thinks someone will have to “tear up the set top box” (amen) to make a viable product, but if Google TV proves to be something consumers want (far from a sure bet at this point), they will have done so without doing that. But at the same time, they’ll be raising peoples’ expectations for what to expect from a television experience — and this could allow Apple to come in and do the tearing up of the box.
Recent rumors had Apple hard at work on the next generation Apple TV. The current thought is that this would be a cheaper ($99) device, that relies heavily on cloud-based service. As I wrote last week, the price confuses me because it doesn’t seem to go along with the high-margin products Apple makes all their money selling. So either they’re able to produce these for a really low price (which doesn’t seem too likely) — or they’d do this cheap box to get consumers hooked on their better experience and content, and then shift to more expensive boxes.
Given Jobs comments tonight, the latter could well be an option. He’s clearly thought about this a lot (he mentioned they thought about doing a TV product instead of the iPhone — and then instead of the tablet, but there was no good market strategy), and seems frustrated by the current stalemate.
But Jobs may have another option.
The entire time Jobs was expressing his thoughts about this topic, I kept thinking back to the long-standing rumors that Apple may one day make their own television set. Again, not a box, an actual display.
This would eliminate Jobs’ concern about there being too many boxes in the living room. And it would allow him to bypass the cable boxes (which would have to hook in to his unit — which he would undoubtedly control). The main problem with this is that the television hardware business is generally a low-margin one. But then again, so is much of the PC market, and Apple does just fine there. If Apple could come up with some sort of premium television set, people would buy it.
Undoubtedly, this Apple television would be slow-going at first as Apple would restrict what types of cable boxes (if any) and/or cable companies you could use with it. But eventually, it could force the industry to conform to its new standard of television much in the way that the mobile industry has been shifting the past few years for the iPhone/App Store. And again, Google TV may be a catalyst to set this all in motion.
“No one is willing to buy a set top box,” Jobs said tonight. With a true Apple Television, no one would have to. I can almost hear Jobs now: Apple Television: it’s the best television out there. But it’s also the best web surfing experience from your couch, the best app console in your living room, and the best connected media player in your house.
Started by Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple has expanded from computers to consumer electronics over the last 30 years, officially changing their name from Apple Computer, Inc. to Apple, Inc. in January 2007. Among the key offerings from Apple’s product line are: Pro line laptops (MacBook Pro) and desktops (Mac Pro), consumer line laptops (MacBook Air) and desktops (iMac), servers (Xserve), Apple TV, the Mac OS X and Mac OS X Server operating systems, the iPod, the...
Apple TV is a network device for both Macintosh and PC computers that allows users to download, stream, and view High Definition television shows on demand via iTunes.
Google provides search and advertising services, which together aim to organize and monetize the world’s information. In addition to its dominant search engine, it offers a plethora of online tools and platforms including: Gmail, Maps, YouTube, and Google+, the company’s extension into the social space. Most of its Web-based products are free, funded by Google’s highly integrated online advertising platforms AdWords and AdSense. Google promotes the idea that advertising should be highly targeted and relevant to users thus providing...
Google TV is a new experience made for television that combines the TV you know and love with the freedom and power of the Internet. Watch an overview video below, sign up for updates, and learn more about how to develop for Google TV.