Apple HDTV rumors resurface
Years-old rumors that Apple will roll out a line of Internet-connected displays have resurfaced in reports that suggest the company will bundle its Apple TV product within a new line of HDTVs.
In a report referencing a rumor floated by Mahalo chief Jason Calacanis, who claims that he knows "first-hand" that Apple is working on what's described as a networked television, CNET writer Nate Lanxon noted that the assertion "isn't surprising" given Apple's 30-inch Cinema Display.
Back in January 2007, American Technology analyst Shaw Wu supported such rumors with a research note stating that the company was working on "large screen" technologies within its development labs. "We are not certain on timing but our analysis indicates that AAPL is beyond prototype on large-screen technologies (for a larger monitor or possibly Apple-branded HDTV)," he advised clients at the time.
However, that was nearly two years ago. Since then, Apple has continued to sell video projectors from Epson and NEC in both its online and physical retail stores but does not sell HDTVs in either, indicating that the company hasn't exactly rushed to enter the HDTV market. A number of cost and usefulness factors have likely come into play.
Cinema Display vs HDTV
Apple already faces tough competition in its high-end Cinema Display line. Apple's largest 30" display costs $1800 and requires a "Pro" level Mac with Dual Link DVI graphics in order to drive the screen's 2560x1600 resolution. A name brand 32" HDTV costs closer to $700, because it uses inexpensive parts to deliver a much lower resolution picture.
Apple TV is designed to target those simpler TV displays. It can theoretically deliver a 1920x1080 (1080p) signal, but most content is typically supplied at 1280x720 (720p), or roughly a quarter the resolution of the 30" Cinema Display. Apple's HD iTunes content is distributed at the lower standard HD resolution, as is most HD cable and free HD broadcasts. There is next to no content delivered at 1080p outside of Blu-ray discs, which have yet to make a significant impact on the market outside of a videophile niche.
The majority of HDTVs under 40 inches are also "only" 720p resolution, as full 1080p resolution displays are considerably more expensive but only deliver a visible superiority on sets larger than 50 inches. Some networks also favor the 720p standard for its smoother image quality in fast moving sports programming, including ABC, FOX and ESPN; other networks supply their HD programming in 1080i, including CBS, NBC, HBO, and Discovery, which provides a sharper picture in low motion still shots.
Apple TV provides nominal support for 1080i video, but content it delivers from iTunes is 720p, while most podcasts are either 720p, standard definition 640x480, or even lower quality. YouTube supplies 320x240 video, although Google is beginning to roll out a higher quality 448x336 encoding option.
Mind the (price) gap
The vast difference in price and quality between Cinema Display computer video resolutions and the relatively low resolution HDTV market means that HDTVs are a far more competitive, commoditized mass market. That results in little room for Apple to differentiate itself as a TV vendor.
Instead of selling its own low margin, high volume TV sets, Apple has shipped the Apple TV appliance as a device that can work with any modern HDTV set from any manufacturer. In the direct-to-TV arena, Apple TV compares with HP's $350 MediaSmart box, or Sony's $300 Sony Bravia Internet Video Link module tied to Amazon's Unbox service.
No manufacturer has seen any runaway success in selling an Internet-connected HDTV for streaming downloads, photos, music and related content like Apple TV. HP's strategy of attaching its MediaSmart box to its own HDTVs has not resulted in any particular success, and Sony's incorporation of its Bravia Internet Video Link module has faired roughly as well.
Much of this challenge stems from the cost. Putting a $229 Apple TV into an HDTV costing $700 or more would add 32 percent to the price of the set. In a market where price is often the primary consideration, this may be a difficult sell.
Low Margin HDTV + Low Margin Apple TV = Win?
Price breakdowns indicate that Apple's margins on the Apple TV are already razor thin, particularly when compared to Macs, the iPod, and the iPhone. That gives Apple little room to strip the price down further, even if it were incorporated directly into an HDTV set. It simply includes too many expensive components. Apple sells the unit as nearly a loss leader to gain a foothold in the slowly emerging market for direct TV downloads.
Instead, Apple has been incrementally improving the software of the Apple TV to features such as HD video downloads, support for Dolby Digital 5.1, and most recently HD TV programming from iTunes and Remote features that integrate with the iPhone and iPod touch. Apple has taken dominant market share in video downloads as existing rivals, including Vongo, have failed and new competitors such as Vudu have struggled to match Apple's aggressive price cuts.
If anything, Apple's best bet may be to work out a deal to bundle Apple TV units with the HDTVs sold by manufacturers, or else striking deals with partners such as Best Buy to sell the unit as an accessory with the new HDTV units it sells. Given that Apple hasn't shipped its own HDTV set incorporating Apple TV features over the last two years of reportedly investigating the possibility, it would seem likely the company is taking its time investigating alternatives to jumping into the risky HDTV business all on its own.
In a report referencing a rumor floated by Mahalo chief Jason Calacanis, who claims that he knows "first-hand" that Apple is working on what's described as a networked television, CNET writer Nate Lanxon noted that the assertion "isn't surprising" given Apple's 30-inch Cinema Display.
Back in January 2007, American Technology analyst Shaw Wu supported such rumors with a research note stating that the company was working on "large screen" technologies within its development labs. "We are not certain on timing but our analysis indicates that AAPL is beyond prototype on large-screen technologies (for a larger monitor or possibly Apple-branded HDTV)," he advised clients at the time.
However, that was nearly two years ago. Since then, Apple has continued to sell video projectors from Epson and NEC in both its online and physical retail stores but does not sell HDTVs in either, indicating that the company hasn't exactly rushed to enter the HDTV market. A number of cost and usefulness factors have likely come into play.
Cinema Display vs HDTV
Apple already faces tough competition in its high-end Cinema Display line. Apple's largest 30" display costs $1800 and requires a "Pro" level Mac with Dual Link DVI graphics in order to drive the screen's 2560x1600 resolution. A name brand 32" HDTV costs closer to $700, because it uses inexpensive parts to deliver a much lower resolution picture.
Apple TV is designed to target those simpler TV displays. It can theoretically deliver a 1920x1080 (1080p) signal, but most content is typically supplied at 1280x720 (720p), or roughly a quarter the resolution of the 30" Cinema Display. Apple's HD iTunes content is distributed at the lower standard HD resolution, as is most HD cable and free HD broadcasts. There is next to no content delivered at 1080p outside of Blu-ray discs, which have yet to make a significant impact on the market outside of a videophile niche.
The majority of HDTVs under 40 inches are also "only" 720p resolution, as full 1080p resolution displays are considerably more expensive but only deliver a visible superiority on sets larger than 50 inches. Some networks also favor the 720p standard for its smoother image quality in fast moving sports programming, including ABC, FOX and ESPN; other networks supply their HD programming in 1080i, including CBS, NBC, HBO, and Discovery, which provides a sharper picture in low motion still shots.
Apple TV provides nominal support for 1080i video, but content it delivers from iTunes is 720p, while most podcasts are either 720p, standard definition 640x480, or even lower quality. YouTube supplies 320x240 video, although Google is beginning to roll out a higher quality 448x336 encoding option.
Mind the (price) gap
The vast difference in price and quality between Cinema Display computer video resolutions and the relatively low resolution HDTV market means that HDTVs are a far more competitive, commoditized mass market. That results in little room for Apple to differentiate itself as a TV vendor.
Instead of selling its own low margin, high volume TV sets, Apple has shipped the Apple TV appliance as a device that can work with any modern HDTV set from any manufacturer. In the direct-to-TV arena, Apple TV compares with HP's $350 MediaSmart box, or Sony's $300 Sony Bravia Internet Video Link module tied to Amazon's Unbox service.
No manufacturer has seen any runaway success in selling an Internet-connected HDTV for streaming downloads, photos, music and related content like Apple TV. HP's strategy of attaching its MediaSmart box to its own HDTVs has not resulted in any particular success, and Sony's incorporation of its Bravia Internet Video Link module has faired roughly as well.
Much of this challenge stems from the cost. Putting a $229 Apple TV into an HDTV costing $700 or more would add 32 percent to the price of the set. In a market where price is often the primary consideration, this may be a difficult sell.
Low Margin HDTV + Low Margin Apple TV = Win?
Price breakdowns indicate that Apple's margins on the Apple TV are already razor thin, particularly when compared to Macs, the iPod, and the iPhone. That gives Apple little room to strip the price down further, even if it were incorporated directly into an HDTV set. It simply includes too many expensive components. Apple sells the unit as nearly a loss leader to gain a foothold in the slowly emerging market for direct TV downloads.
Instead, Apple has been incrementally improving the software of the Apple TV to features such as HD video downloads, support for Dolby Digital 5.1, and most recently HD TV programming from iTunes and Remote features that integrate with the iPhone and iPod touch. Apple has taken dominant market share in video downloads as existing rivals, including Vongo, have failed and new competitors such as Vudu have struggled to match Apple's aggressive price cuts.
If anything, Apple's best bet may be to work out a deal to bundle Apple TV units with the HDTVs sold by manufacturers, or else striking deals with partners such as Best Buy to sell the unit as an accessory with the new HDTV units it sells. Given that Apple hasn't shipped its own HDTV set incorporating Apple TV features over the last two years of reportedly investigating the possibility, it would seem likely the company is taking its time investigating alternatives to jumping into the risky HDTV business all on its own.
Comments
They REALLY will not start selling Monitors with AppleTVs built in.
The market for all-in-one TVs with built-in everything died years ago, and I don't see anyone who wants to have their digital technology (DVR, DVD, etc) tied to their monitor. Even cable-cards have died a quiet death.
Apple will not start selling HD monitors. That's a commodity market, already saturated by companies with WAY more experience and focus than Apple. Takes up LOTs of warehouse space which Apple doesn't have in its retail chain.
They REALLY will not start selling Monitors with AppleTVs built in.
The market for all-in-one TVs with built-in everything died years ago, and I don't see anyone who wants to have their digital technology (DVR, DVD, etc) tied to their monitor. Even cable-cards have died a quiet death.
Commodity? You could say the same thing about computers and mobile phones. They didn't drop Computer from their name for nothing. It's been a long time since the Cinema Displays were updated, and I'd say the HDTV thing has a lot to do with it.
Interfaces and remotes have become a nightmare for people trying to watch TV. Look for Apple to make it easier.
There is next to no content delivered at 1080p outside of Blu-ray discs, which have yet to make a significant impact on the market outside of a videophile niche.
Sorry but that is pure crap statement, mainly because of the existance of the PS3, which has sales numbers in the millions and are not a "videophile niche".
Price breakdowns indicate that Apple's margins on the Apple TV are already razor thin,
This surprises me, as the one thing that really stands out to me is that the Apple TV is grossly overpriced for what it does. If this is true, they really need to figure out a way to make them less expensive to build.
"BD's have yet to make a significant impact on the market outside of the videophile niche" is about as accurate as you're going to get - until the prices come down to the DVD prices and the players drop to $100 range it's not going to take off and become mainstream.
Sorry but that is pure crap statement, mainly because of the existance of the PS3, which has sales numbers in the millions and are not a "videophile niche".
I think what was being said was that virtually the only source of 1080p HD content is from BDs. Yes, PS3 has a Bluray drive, but has it increased demand 1080p content? The answer to that is probably not. I know a few people with PS3s and none of them even have any Bluray movies...
Apple TV provides nominal support for 1080i video, but content it delivers from iTunes is 720p, while most podcasts are either 720p, standard definition 640x480, or even lower quality.
1080i? Not in any spec I've ever seen. Unless you just mean upscaling 720p to 1080i, but that's not "video" playback.
http://connectedtv.yahoo.com/
http://connectedtv.yahoo.com/partners/att
http://www.tru2way.com/
Will Apple create a HDTV? That depends on what technologies they can bring to the field. I think that there's room for improvement in HDTV where interfaces are concerned. Can Apple leverage their talents here is unknown to me.
The HDTV market is no different that computers.
You have the low end/low margin entry level.
You have the mid price monitors
You have the high end/high margin monitors
We know Apple is not going to be a player in the low end. If they do enter the HDTV field they won't be competing with the Magnavox or low end Visio stuff.
I think we're still a generation or two of SoC chips aways from embedding an Apple TV into a HDTV but overall it makes sense once the BoM is down to just a few chips and memory.
Years-old rumors that Apple will roll out a line of Internet-connected displays have resurfaced in reports that suggest the company will bundle its Apple TV product within a new line of HDTVs.
In a report referencing a rumor floated by Mahalo chief Jason Calacanis, who claims that he knows "first-hand" that Apple is working on what's described as a networked television, CNET writer Nate Lanxon noted that the assertion "isn't surprising" given Apple's 30-inch Cinema Display.
So you took some rumor about "networked television" and somehow turned that into Apple making HDTVs? Maybe it's just a better version of the current Apple TV.
That said, I am left wondering if the new video port on the Mac might be HDMI and we'll see a new line of displays Apple that'll take HDMI including from the Apple TV.
This surprises me, as the one thing that really stands out to me is that the Apple TV is grossly overpriced for what it does. If this is true, they really need to figure out a way to make them less expensive to build.
I've always thought that! Either Apple is not taking full advantage of the AppleTV hardware or they have other plans for it. I really believe that Apple should consider opening AppleTV for gaming if possible or to think about it in the next AppleTV hardware upgrade (whenever that will be).
I would buy an Apple HDTV in a heartbeat. I'm sure it would include all sorts of extra goodies. Maybe even let me use it as a monitor.... wirelessly. It would be even more awesome if they integrated a DVR into it (VERY VERY VERY doubtful). I'm tired of my POS Comcast cable box freezing and mucking up my recordings.
I wondered why no one released a WiFi LCD HDTV yet! I've heard about LG releasing one last year but nothing since. An HDTV with something similar to AppleTV (mainly a replaceable HDD and a processor) built in is not that bad if you consider that people keep their TVs for long time. At least this will reduce wiring and the number of remote controls.
The problem I see here is that not many people who already own an HDTV will be welling to pay another $1000+ for a TV. So this might not be viable option for Apple now.
I still dream of a Mac mini with 1TB HDD and HDMI output. That would be my perfect TV media player.
I know a few people with PS3s and none of them even have any Bluray movies...
if anything, the number of bluray movies sold should be an indication. And it's still orders of magnitude lower than DVD sales. Maybe it's not exactly videophiles, just people with enough money.
I think what was being said was that virtually the only source of 1080p HD content is from BDs. Yes, PS3 has a Bluray drive, but has it increased demand 1080p content? The answer to that is probably not. I know a few people with PS3s and none of them even have any Bluray movies...
Well Iron Man just sold 500,000 on Blu-Ray, how many of those are going to be watched on PS3s do you think? My primary argument was that Blu-Ray is not a "videophile niche", although I wouldn't argue that its a small part of the market right now. "Videophile niche" makes it sound like something no non-videophile would bother with which is simply not true, not compared to the niche products like DVD-A in the Audiophile market are, for example.
Sorry but that is pure crap statement, mainly because of the existance of the PS3, which has sales numbers in the millions and are not a "videophile niche".
Including the sales of all PS3s are Blu-ray players the number of Blu-ray drives compared to DVD drives is quite low. WE'll have to wait until the calendar Q4 results are in before we'll be able to see how well BRDs are doing in comparison to DVD and digital downloads. It is still very much a 'videophile niche' as most people are okay with up-converting DVDs and the "good enough" quality of instant access to streaming HD content. Time and time again, convenience and price has shown to be the most important aspects to consumers.
People need to go back into Apple's history and see what Jobs was thinking years ago. An Apple TV is not far fetched.
Considering that the AppleTV already exists, I'm assuming you are referring to an Apple-branded HDTV. But this offers too many issues. How many sizes do they offer? Do they use plasma, LCD, projection, or the up-and-coming OLED? Have you seen the size of the TV sections of department and electronic stores? Apple making their own TV makes no sense and you then you run into the issue of the HDTV or Apple's media extender breaking before the other components do, like with the all-in-one VHS/DVD TVs
The best option is to go with an industry standard that allows for the AppleTV to be secured to the back of the HDTV, like with HP's failed media extender. The only issue is that Apple would have to get with TV manufacturers to get the AppleTV's IR receiver?or the USB port on the back?to connect to and respond to the HDTVs IR receiver.
This surprises me, as the one thing that really stands out to me is that the Apple TV is grossly overpriced for what it does. If this is true, they really need to figure out a way to make them less expensive to build.
WHAT! Name a cheaper media extender? For $229 you get 802.11n, 100BASE-T (wish it was 1000BASE-T), 40GB HDD, 1GHz Intel CPU, 256MB DDR2 RAM, Nvidia 7300, HDMI 1.3, Component, analog and optical audio. You can also buy and rent audio and video right from the device which makes it very convenient.
Granted, it's not for everyone, but after seeing the $215 Popcorn Hour?the one that most closely matches the AppleTV HW specs?not work because of Vista, not to mention the complete lack of both a HDD and WiFi the AppleTV is an exceptional deal. The only crutch is that you need to perform the simple and quick task of installing the appropriate codecs via the USB port on a flash drive.
Well Iron Man just sold 500,000 on Blu-Ray, how many of those are going to be watched on PS3s do you think? My primary argument was that Blu-Ray is not a "videophile niche", although I wouldn't argue that its a small part of the market right now. "Videophile niche" makes it sound like something no non-videophile would bother with which is simply not true, not compared to the niche products like DVD-A in the Audiophile market are, for example.
And they sold over 7 million regular DVD's and I'll bet the regular DVD sales won't drop off quite as quickly as the BD. So the most popular movie to release to-date on BD sells about 1/14th the # of DVDs. The general numbers aren't anywhere near this kind of performance for BD either. The movies that are special effects heavy are going to sell better on BD than something like the Notebook but until people are convinced that watching some like the Notebook on BD is a better idea DVD is going to remain atop the heap.