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Apple TV: The Recipe for Success
Two years later, the iPhone has exploded into the best selling phone of any cell phone, with high critical acclaim and an App Store that is revolutionizing application distribution, and the Apple TV has, well, been sleeping. Sales numbers haven't been revealed, and the Apple TV remains the hobby that Steve Jobs called it after it flopped. Rabid fanboys have defended the Apple TV, saying that Apple did a great job on it, and its an excellent product if you learn to appreciate it. The problem is, consumers aren't going to pay 230 dollars for a product they have to "learn to appreciate." So what's the problem with the Apple TV? It's simple: it doesn't do anything that consumers can't already do. Movie Rentals? Everyone with cable or satellite can do that with the same titles at the same price. TV Shows? Everyone can watch TV Shows, and most can record them, for free, which sure beats paying 1.99 per show (or 2.99 for HD). Music? Music Channels are aplenty on cable and satellite, and one can easily burn a CD of their own music to play. Purchasing Movies? Everyone has a DVD player, and they would much rather use the DVDs they already have or rent one at Blockbuster than to start their collection from scratch. Youtube? Well, you got me there, but I don't see Apple TVs selling like hot-cakes because you can watch Youtube pixellated on a flat screen TV as opposed to your computer. The point is that the Apple TV has nothing unique or innovative that makes it worth the asking price for the average consumer, and with the economy the way it is, the Apple TV has the lowest bang for the buck of any Apple product.
The question remains: what should Apple do to fix it? First of all, they need to change the focus again. Its not Movies, Movies, Movies as Steve Jobs declared last MacWorld. Its TV Shows, TV Shows, TV Shows! The number one thing that consumers use their TV for is TV Shows, period. Movies are not the primary focus of a TV. Apple needs to figure out a way, through live TV, ad-supported content, and great consumer choice to make the Apple TV a worthy alternative to cable or satellite. People are NOT, I repeat, NOT going to shell out 2-3 dollars per TV Show. This is stupid, moronic thinking. Perhaps Apple could offer a way to deliver standard channels for a monthly fee per channel. Instead of packages, people could pay a certain amount of money per month, per channel, allowing them complete control as to what is on their TV, and what's not. Next, the Apple TV needs one of these two things. Either they establish a movie catalogue as large as the one of Netflix, or they include a built in DVD player. They cannot expect to take over DVDs if they can't offer as many titles, and if they don't offer as many titles, in one of those two ways, they can not expect to sell Apple TVs. If they really want to be an advocate of consumer choice, they could offer a DVD player and a large catalogue, but that isn't very much like Apple. As far as the iTunes movies work, they need to change the way the rentals work. Something along the lines of 7 days to watch the movie as many times as you want before it expires, similar to the way a physical video rental service works, would be much better than the confusing model they have today. Also, all movies should be available for rent and purchase from the second they hit the store. I'm aware that its primarily the studios to blame, but its not as though Steve is setting the best example himself. Also, the Apple TV needs a new remote. The white one that gets lost in your lap must go by the wayside. I think a multitouch universal remote would fit the bill perfectly, and although it would be fairly expensive, it would be worth it. iPhone and iPod Touch users could use their devices to control the Apple TV as well as the music they can already control. More on the advantages below. Also, the Apple TV could benefit greatly from an App Store. Developers could add apps for online services such as Hulu, and could create games that could be controlled by the universal remote. Imagine controlling a car racing game with the universal remote as the steering wheel for your big screen. The possibilities are tantalizing. Couple this App Store with a better graphics card (nVIDIA anyone?), and you may have a recipe for success. Finally, the price. If the Apple TV was a viable alternative to cable and satellite, consumers would be willing to pay more upfront. I could envision a 249 starting price with a 299 and a 349 option, the only difference between the models being hard drive size and graphics. Apple created the Apple II and the Lisa before it found success in the Macintosh. The iPod was a niche product until PC support was added, which allowed it to take over the music industry. The iPhone started at 599 and did fairly well, but it wasn't until Apple created iPhone 3G for 199 did it take over the cell phone market. Hopefully it will have taken Apple the first Apple TV to take over the living room as well. ( Filed Under: )
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Comments
An apple A La Carte offering
An apple A La Carte offering for TV channels would never work. Cable/Telco companies have been fighting this option for years despite FCC chairman Kevin Martins push for it.
Channels such as ABC owned by Disney would only go along with it if Apple then made subscribers sign up for ESPN & Disney channel. Then bundling would start to be included in price drops and the whole A La Carte method would be out the window and back to packaged content.
Apple would have to create a whole new network for cable distribution unless it coupled with an already existing provider. ie. AT&T for the iPhone. Bandwith via IP would cap the amount of channels they could offer for a long time coming until technology can host all the channels. Would you want to watch a buffering screen instead of your selected TV show?
Factual errors
At the start of the article you talk about MacWorld 2009 - wasn't it MacWorld 2007?
Corrected
Corrected
Gaming
Make the iPhone and AppleTV work (iPhone/touch as a remote AND a controller) - porting all those iPhone games to your AppleTV. Throw in a little SlingBox technology and Good Lord, why wouldn't we line up to buy AppleTVs?
Exactly.
That is a piece of technology
That is a piece of technology I dream of.
here in Europe Apple TV costs
here in Europe Apple TV costs 299 EUR (375 USD) and no movies, no TV shows... what a bargain. :))))
I've got 2 apple tv and love
I've got 2 apple tv and love them both. Although I mainly use it for listening to my Itunes content on my imac to my hifi and TV, why do they never push this capability !
Apple TV??
As I have stated before on this website, there is something more to the Apple TV name. It has TV in it.
It is about time that Apple does something revolutionary again, something different. Why have all these boxes laying around. With the loom of new monitors on the way, and OLED becoming much more affordable. I wouldn't be surprised to see Apple make the Apple TV what it should be. A TV!!
Not just any TV, one with all the capabilities that the current Apple TV 2.0 has, and a few extras. 1tb HD, 1080p capabilities, built in tuner, built in blu-ray, wireless capabilities, built in DVR, multi-touch remote control (iPhone / iPod touch capabilities), built in iSight with iChat so that you can video chat with all of your friends that have a webcam and an Apple product with iChat. all in a nice ultra thin say 30in - 50in frame. Call it, oh i don't know, Apple TV 3.0.
Just imagine your family all having an iSight on their big screen TV in their living room, and with a multi touch control, you would be able to show your latest video and pictures to them in presentation mode as well. It would be a whole new way of bringing people together. I would much rather video chat with friends, and family from the luxury of my living room. With the ease of you use that Apple knows how to create. This product would be the next must have.
Pricing would obviously be a little steeper. Each models would have a set of options, color, hd size, dvd player or blu-ray choice. Price starting at $999.00 and the top end being around $2999.00.
If Apple would muster up the (hrm hum) to do this i would wait in line to buy one tomorrow.
My actual feel that this will happen, 10% chance, but with Apple you never know.
Apple TV 3.0
I forgot one more thing.
HD TV Tuner build in!!
Nice, I want one.
It would be nice to get rid of my DVD player, Apple TV 2.0, Cable Box, HD Switcher, and Optical Audio Switcher. Just have the Apple TV 3.0, receiver, and gaming systems. OH MY APPLE PLEASE MAKE
Nice suggestion 9to5Mac Noob if you agree leave response.
Love my AppleTV but...
I think the CONCEPT of the AppleTV is terrific. It just falls short of two things: quantity of movies available and speed of the user interface.
I think of it as my component iPod... the iPod that interfaces into my home stereo system.
I absolutely love having ALL of my iTunes music and ALL of my photography integrated into my stereo system instead of from my computer. Love the screensavers with my photos. Love being able to fire up slide shows on a whim. And the iPhone REMOTE application makes the music side of AppleTV usable.
The interface speed is attrocious. They violate the "sub-second feedback rule" with EVERY command (except through the iPhone). When you click the clicker, sometimes you get audible feedback in half-a-second, sometimes not for 10 to 30 seconds. If my home DVR or DVD Player responded that way... I would take it back for a refund in a hearbeat.
With a faster responding interface, full control of video, photos and music from the iPhone and 3-5X more movies... I think the AppleTV would do much better.
Jim
Nintendo Wii
The idea of an app store for the Apple TV is intriguing. Nintendo uses this model very effectively on the Wii. My kids are always begging me to buy more Wii points to download some new game onto the console.
That being said, I can't imagine how I would have followed HD news coverage of election day without my HD cable box. Right now I would lose too much (HD movies, HD TV shows, DVR capability ) by giving up my cable box in favour of Apple TV and gain little in return.
Add a DVD player, an HD tuner, some HD DVR capability to Apple TV and I will gladly kick my TiVo, Tivo and HD cable converter box to the curb.
why is that how you see it?
AppleTV provides HD Movies and TV shows. It is better than a DVR it is video on demand. I will admit that if you want real time TV (news and sports) that you can't easily do on your computer that you will need lifeline cable. But everything else is just better on AppleTV.
Think about how much you spend on cable TV WITH COMMERCIALS!!!!!! Now imagine spending about the same with NO COMMERCIALS. Over 500 shows that you own and can watch when ever and where ever you want.
For 2.99, I'd rather watch
For 2.99, I'd rather watch it on TiVo and fast forward the commercials myself.
I'm waiting
For the model you proposed to come out. I am on the verge of buying one now but holding out for more magic, and cheaper magic :)
The author doesn't get it.
The author's criticism of the Apple TV only underscores the fact that he doesn't understand it. If he actually owned one, he'd be fan. Ask anyone who does own one. We all love ours. Essentially, the Apple TV is a hi-def video and audio component ipod for your home theater system.
Not only can it play movies and videos in DVD and HD resolution, but you can rent and purchase them through the Apple TV. You can also use it to subscribe to audio and video podcasts, some of which are in HD. It can store multimedia files internally and it syncs wirelessly with your iTunes audio and video library on your Mac or PC. It's great!
Yes, the interface could be faster. I personally don't mind the minimalist remote. I think it works fine. Three things I would like to see in the next model: native 1080p (the current models play 720p natively and upvert to 1080p) and support for Dolby TrueHD and DTS-MA (currently, only Dolby Digital 5.1 is supported for surreound sound), and a built-in web browser with Flash support. Contrary to what the author believes, I say that a built-in optical drive is unnecessary in the 21st century, and if Apple were to put one in it would be Blu-Ray, not DVD. The author must think this is 1998.
"Now don't start bashing me
"Now don't start bashing me for hating on the Apple TV: I am a proud owner of an Apple TV, and have loved every bit of it. As a filmmaker, there is no better way to showcase my films to friends than the Apple TV. As a person who has been blacklisted from all the movie rental stores in town for forgetting to return the rentals, and who hates navigating and troubleshooting the clunky DVR rental system that is included with my cable, the Apple TV fits the bill perfectly for me."
You didn't read it too carefully, did you?
Stream web video, on any TV
Give me a way to stream any web video from any source: Hulu, Fancast, Netflix, etc. If I can watch it on my PC, I should be able to watch it on my TV.
Let me plug it into any plain old standard-def TV with component, composite, or (gasp) RF connectors.
Apple's already got a number of great patents relating to an upc
Apple's already got a number of great patents relating to an upcoming universal remote. Read more at http://watchingapple.com/2007/06/universal-remote/.
The real problem is perception and content
I disagree with your assessment of where the product actually is. Lets pick your perceptions apart a bit.
1) movie rentals - I have DirectTV and right now I have access to maybe 30 titles for rent. Cable is not much different. AppleTV on the other hand has over 4000 movies. A number that rivals any local Rental place and the movies are never out of stock.
2) Everyone can watch TV but none watch for free. Most pay big money for cable delivery and then on top of that they pay by watching Ad's.
3) Music channels and CD burning? You are going to equate these to the access to music you have on AppleTV? Come on!
4) Purchasing Movies? Everyone has a DVD Player. Ok, but why would someone prefer to purchase a DVD rather than purchase from iTunes? iTunes is cheaper, easier to backup and harder to damage. The files are easier to find and often look better because the AppleTV has excellent up-converting hardware. Now for existing DVD, HandBrake makes for a one step conversion but even without that, we are not saying you have to get rid of your DVD player tomorrow.
5) Or rent from blockbuster. Seriously? Apple may not have Netflix beat on selection but they easily match your local blockbuster and are never out of stock. You can hold on to them for 30 days before watching and you have 24 hours to watch and re-watch as well as a virtually unlimited time to finish watching. (once started a movie will not be deleted until you leave the movie). Also, AppleTV will be the first HD rental option for many people as BluRay isn't flying off the shelf ether.
6) YouTube. This may not be a reason in and of it's self, but it is a cool addition and getting better all the time as Google increases quality and length.
It sounds good so far, and you forgot the huge library of Video and audio podcasts, the ability to bring your personal media, as well as your friends, and families, media into your living room.
So why aren't they flying off the shelves?
Number 1 reason: Content. People (even you) expect netflix style catalogs, when most people still rent from blockbuster. Also, wacky restrictions that make some movies available immediately for Rent others for Purchase, some for both just confuse and frustrate people.
Number 2 reason: Cost! This is both content and player but player mostly. I say this because most people are happy with their AppleTV once they get it. We would all like movies to be $.99 to $2.99 but the truth is that Apple's prices are about what we would pay somewhere else. The up front cost though makes it so fewer people will just give it a try.
So, how to increase sales? There are a number of ways but they all boil down to these two.
1) Reduce the initial cost to $99 and make it up in iTunes sales. Apple would have to look as this as an investment in the iTunes ecosystem and would make a great black friday special!
2) Increase the amount of "free" content. Adding a Hulu, NBC, CBS, and/or even a NetFlix plugin, much like the YouTube plugin would go long way toward making more people realize that they can cut their cable.
I've rambled long enough, but I will mention that many people could consider leaving cable entirely for iTunes/AppleTV if what they mostly watch is first run shows (eventually you would have a catalog of re-runs). A typical DirectTV bill for one TV with HD DVR service is over $70/month or 840/year. That will buy you around 24 different shows each with about 22 episodes or about 500 shows. (yes I know that 500 * $2.00 is $1,000, but season passes and discounts on iTunes gift cards bring the price down). I'll be cutting my cable in january, you should consider it too.
The real problem is too many restrictions
The real problem is too many restrictions. I do agree with you that the lack of content is part of the problem. The restrictions on the available content is the big problem.
The movies that are available for rent have a serious time restriction. I am sure that you have heard this argument before, but here it goes. I am a parent of 2 toddlers and a baby. Many times when my wife and I start watching a movie, it takes a couple of days to watch.
If I want to watch something that is either not itunes, created on my apple(home movies), or youtube, I can not. More restrictions.
Another thing about the apple tv, is that it is a rehash of many existing items. A directv or dish network dvr does a great job of storing shows for me to watch any time I want without having to pay for those shows.
It seems that the effort that should have gone into this product simplly was not there. The appletv is using an intel mmx chip. We are talking about 10 year old technology.
Imagine if the appletv had the physical footprint of standard hifi equipment, had a built in bluray drive(I can dream of a bag of hurt I guess) have the processor power and graphics power to experience modern video games, browse the internet, and have itunes. This would be a dream unit for a videophile and audiophile's dream accessory.
Come to think of it, Apple should make a deal with SONY. They should merge the Appletv and the PS3. Both units are under performing.
Apple should design the exterior box and add full itunes integration to the unit. Sony would provide the bluray drive, games and processor. Both companies should do away with their remotes for a merged remote; the size of the SONY remote while keeping the simplicity of the few buttons that apple has. They should use Apple's simple and direct operating system. They should do this and sell the unit with a 60GB hard drive for $199. A bigger 320GB hard drive for $299.00. The unit should be customizable enough to allow the user to increase the ram or the hard drive at will.
Now that would be awesome.
Spoken like someone who doesn't own one
The problem with that argument is that it is not true! You have as long as you want to finish a movie. If you can't get through the movie in the 24 hour period (which is the exception for most not the rule) the file will not be deleted until you switch off of it. In other words, you can pause it, and continue it for hours, or even days beyond the 24 hour period.
Anything you can get into iTunes (which is just about anything) you can watch on AppleTV. I don't know where you get your facts but there is a YouTube client built into AppleTV.
>>>>A directv or dish network dvr does a great job of storing shows for me to watch any time I want without having to pay for those shows.<<<<
REALLY??? You don't pay for directTV? How did you get that deal? I pay $70/month for my DirectTV programing, and can only watch it on a single TV with no option to move it to my computer, iPhone or iPod.
Although the AppleTV is not bleeding edge tech, it is also not decade old tech. The Pentium-M was first introduced in March 2003 so 5 year old tech would be more accurate. And don't forget that it does include an Nvidia GPU as well. As for your other recommended "upgrades", if you are recommending that my next appleTV look like the POS DirecTV HD DVR, with it's noisy fan and huge heat output, I'm thinking no!
I'll say it one more time. The problem is that apple is asking people to interact with TV in a totally different way and this is hard to grasp (as is obvious when you say that $70/month is free TV) without owing the unit. So the last thing they have to do is increase price. A $99 AppleTV with current or slightly increased specs would do much more for the product line as well as Apple's ability to negotiate with studios. IMHO
I am sad to say the Apple Tv
I am sad to say the Apple Tv is Apple worse product. I own tow of them and they just totally stink. I dream of an update that makes this a great product. Apple should either fix it or DOA the Apple TV.
Um..,
I believe you mean EOL, not DOA.
Hard drive space
I own two Apple TV's and I love them. Yes I wish they could add more new features, but all of that will come in time. There is one thing I really don't like. When I download a movie or a TV show I have to keep a copy of it on my computer too. I don't have extra room on my computer to store movies, thats why I got the bigger Apple TV. Same with podcasts, I wish video podcasts would only download to the Apple TV and not to the computer it is synced with. I could be totally missing something in the settings, and I hope I am, but this needs to be fixed.
TV Show Season Rentals
There's an easy way to turn an AppleTV into a DVR - and get rid of cable at the same time.
Let me rent a TV season or simply an episode. It would cost $20 for a season, or $1 per episode. Say I rented the current season of Grays Anatomy and The Unit. When I go to My TV Shows I could get the next episode of The Unit or continue to watch the one I started and didn't finish.
Someone at work says, "You've just GOT to watch Heroes." I rent an episode or two, decide I like it and rent the season.
I pay $100/month for DirecTV, $1200/year. That's 60 seasons of TV. Why do I need DirecTV or cable?
Boxee & XBMC
I have an AppleTV, but it is unfortunately an underpowered, overpriced enigma without a real mission or vision from Apple!
iTunes Movie purchases & rentals in Australia are too expensive & releases are much later than my local video store which rents new release movies for $2! Apple expect me to open my wallet everytime I want new content for their proprietary box. Where's the compelling reason to purchase for the average consumer? I would be happy to have free downloadable content with advertising...
Boxee & XBMC go a long way to showing what is possible on the AppleTV including Hulu support (which is unfortunately not available outside the US): http://blog.boxee.tv/2008/10/01/xbmcboxee-on-apple-tv/ I have also purchased ATVFlash which is also quite promising, & gives a hint as to the possibilities an AppleTV app store could bring to the platform (http://www.atvflash.com/product_info.php?products_id=27)
My dream would be an Apple Media Centre that included the functionality of a Windows Media Center, Windows Home Server & Apple TV with the finesse of an Apple OS & interface. A Mac Mini with a decent video card, TV tuners, Blueray & more functional remote would be a great start. Apple already have these components, but is unlikely to ever create this product. Such a pity as it would cost half the price of an equivalent Windows Media Center system....
Soooo much potential
I agree, it's not about movies. I can and do rent movies from Netflix, my satellite provider, the really cool movie buff dude that runs a small video store down the street and, yes, Apple via iTunes. The 30 days / 24 hours thing doesn't bother me. If I want to watch something a couple times, i get it through another source. I would like to see an integrated DVD player but not a deal breaker.
I semi-disagree on the TV shows. There are a couple of series or even individual episodes that I like to own and have the flexibility to watch on the TV or iPod Touch when I want. Giving it DVR capability would be a very welcome update though.
Apple took care of the remote issue by letting the iPhone or iPod Touch act as a remote. I realize this solution doesn't fix the problem for everyone but I think Apple took care of that tonight with 2.3.
And as for price, it's not that bad given the inherent capability and an HD satellite box isn't much less expensive if at all.
So what does Apple TV really need to take off? Apple TV has a combination of three things that no other box I can buy can touch. First, OS X. Second, an internet connection. Third and infrastructure to deliver content and application - iTunes. Apple TV needs to be opened up to applications like the iPhone/iPod Touch. The potential for games alone would make it worthwhile. Third party development can turn it into a platform that no one else could match. This is far and away the best thing that could happen to Apple TV.
Apple TV...
Commercial Television is such crap! Ads,ads,ads! Whether it's sports or dramatic programming, the ads kill interest! HBO is the only good thing, but they're losing it! Bring back the Sopranos! John Adams was the best thing they've done!
Apple TV 3.0
First of all to get the Apple TV right there are a few things apple needs to do in my mind.
1. they need to get rid of the Apple TV and the Mac Mini and make them one unit. I have a design for this made up and me and a couple friends are trying to make it as me speak. it needs to come in a smaller device with the footprint of the mini and the height of Apple TV. Take out the optical drive and the hard drive and have a small stick of flash memory hold the operating system and a little more room for future updates (similar to the iPhone and iPod). This would be the main system and would have 4 USB ports, a firewire port (800 or 400 i really don't care), and port that splits into HD Component Cables (similar to game systems), and HDMI port, a digital optical out port, a mini display port, an audio out port, and a power input. Then they need to make a new line of optical drives in a enclosure with the same foot print. These drives can come as a combo drive, a super drive, and blu-ray drive and are easily stackable with the main unit. At the same time release a line of external hard drives that are also stackable with the main unit and range from an 120 GB SSD to a 1 TB HDD. It can connect to the main unit via USB or Firewire. It would run on OSX and startup in Front Row out of the box so people who will buy it for a TV unit like the current Apple TV don't have to worry about any type of set up. This will make so you can get exactly what you want from your computer or home entertainment system. I for example would have the main unit, a combo drive, a 1 TB HDD and would use it as a home entertainment system, but maybe my friend wants a main unit, blu-ray drive, and a 360GB HDD and will use it as a desktop computer. Apple will supply the bricks you can make your own tower. : )
2. Apple needs to revamp iTunes. I know iTunes is the industry standard for music now as far as sales go but they need to make a new thing ever better. They should first of all get rid of the different international stores and just make one iTunes store. There are a lot of British shows I would love to purchase as I am sure there are a lot of American movies that Brits would like to buy. I also love a lot of Japanese artist that aren't on the American iTunes store and a lot of smaller American artist that aren't on the Japanese site. I know there are probably a lot of legal channels Apple would have to go to to make this a reality but I'm sure the music industry ( and the movie industry) would make a lot of money through this. And on top of this the industries could cut cost by not having to produce as many physical copies.
3. The last thing apple needs to do is integrate the iPhone and the iPod Touch into this product even more. By adding better integration with these products they could make games available for the Apple TV with the controller being the iPod or iPhone. You could have racing games with the accelerometer in the iphone allowing you to turn like a steering wheel like Mario Kart. You could have games like Legend of Zelda Ocarina of Time have a digital controller show up on the iPhone screen and when you need to use the Ocarina blow in to the mic and play an Ocarina like the Ocarina App thats now available (and incredibly fun by the way). The possibilities are endless. They could make the iPhone a serious player in mobile gaming field and the the Apple TV a force to be reckoned with in home gaming. The best part about it is developers would flock to something like this and Apple wouldn't really have to spend a lot of money developing their own software and could make profit of just the device and iPhone and iPod Touch Sales would go up as well.
Hikaru Nakamura