Imagined iTV image from MacLife
Here’s the thing about the Apple rumour mill: although 90% of it is untrue, when momentum starts to build around a particular idea, it’s safe to say there’s something real behind it. So now that we’ve heard increased mutterings and whispers about Apple’s entrance into the television market, most people assume a Cupertino-made TV is on the way.
But it isn’t. At least, it isn’t coming in the form of a television set. Instead, it’s far more likely that we’ll see a new kind of set-top box.
Nothing about an Apple television makes sense. Hundreds of millions of consumers in the last decade have traded older television sets for high definition ones. The uptake has been both huge and surprising, and the market is now so saturated that margins have been stretched as competition between manufacturers has gotten fierce. The point is that, even given Apple’s enormous brand recognition and reach, how many people might opt for a high-end $2000 TV set from Apple? Ten million? Twenty million, perhaps, if they’re lucky. And then they’d keep those sets for the next five or ten years.
Little about a television set adds up when one considers that everything that Apple has done recently has been about the creation of new market segments (like the iPad) or the upending of existing ones (like with the iPhone). The television market just isn’t right for that sort of change because it isn’t as elastic or easily changed as others, in large part because, having so recently made the transition to HDTV, few consumers will be looking to upgrade again, and so expensively.
Instead, as ordinary as it sounds, the iTV will instead be a set-top box. It won’t, however, merely be a new version of the current AppleTV. It will include both Siri-like voice control and a camera. It will connect to a touch screen control system. Most importantly of all, it will replace your existing cable or satellite box. And like the iPhone and iPad before it, it’s going to be huge.
Let me explain. Apple’s recent success hasn’t simply stemmed from product design; it’s been solving problems at the level of the ecosystem. The iPod and iTunes were two sides of the same multi-billion dollar coin. The iPhone strong-armed AT&T, and then other carriers, into changing their practices, and then introduced the app store. The iPad continued the tradition.
Apple’s concern is systems, not individual products. And the system of video delivery and living room entertainnment is more than TV shows on iTunes. It’s cable and satellite carriers. It’s over-the-top services like Netflix and Cinema Now. It’s web-centric content like YouTube. And it’s also about a growing suite of apps for ‘smart TVs’, including games.
The problem at the moment is that these various ecosystems are unwieldy (ever try searching for a show using your cable box?) and aren’t interoperable. The closest thing we have to being able to search Netflix and another service is Microsoft’s Kinect. So what we can expect from Apple is a product that achieves two main goals:
- Aggregates all those services under one coherent interface that, using a touch screen and voice, makes searching for content simple and efficient.
- Provides apps and an ecosystem, particularly for television and games, that turns the TV into an actual hub of connected entertainment, rather than a scattershot collection of ‘smart apps’.
Why would Apple do this? There are countless reasons, but primarily because the market potential is huge. Instead of ten or twenty million potential buyers of HDTVs, one moves to the hundreds millions of people who use a cable or satellite box. Even at a meagre $200, it would represent a significant new revenue stream for Apple. The app ecosystem would prove a serious challenge to Microsoft and Sony’s dominance of ‘boxes kept under the TV’, as the same (unfortunate?) shift to causal gaming we’ve seen in mobile would take hold in the living room. And most of all, in true Apple style, it will allow a shiny Cupertino product to become the “normal thing that most people own” like the iPod and the iPhone before it (whether or not that’s technically true, it’s often the perception). The aim, of course, will be that if you have cable or satellite, you have an iTV.
There’s something in it for cable and satellite carriers, too. They recognize that current set-top boxes are woefully inadequate to deal with the current glut of content. They also sense a growing sense of threat from ‘cord-cutters’ who ditch their services for Netflix and other content. With an iTV as the norm, they can maintain a foothold in the living room while, like phone carriers with the iPhone, also taking a cut of hardware sales and recouping money on increased service. It’s not implausible that we’ll see some form of streaming TV with an Apple-ified interface, complete with a monthly fee.
Yet most of all, everything about a set-top box makes sense for Apple. It places them at the centre of another media ecosystem. It provides another outlet for the App Store. It will inevitably connect with the iPod and iPad, which will become remotes. Essentially, it would be quintessentially holistic, Apple move that will see it forcefully enter a staid, boring market and push into consumer consciousness as the next big thing.
Whether it is released this year or next is anyone’s guess. The latest rumours suggest Rogers and Bell already have prototypes, which augurs a late 2012 release. What is clear, however, is that it won’t be an actual television–which is also why it will be huge.
____
Navneet Alang is Toronto Standard’s tech critic. Follow him on Twitter at @navalang.
For more, follow us on Twitter at @torontostandard, and subscribe to our newsletter.
