Apple seen taking 5% of HDTV market, earning $17B in revenue

Posted:
in Future Apple Hardware edited January 2014


If Apple were to offer high-definition television sets with an average selling price of $1,500, one Wall Street analyst believes the company could capture 5 percent of the market and earn $17 billion in revenue.



Ben A. Reitzes with Barclays Capital calculates that the LCD market will reach about 230 million units in calendar year 2012. He suggested that Apple could, over time, capture 5 percent of that market and earn $17 billion in revenue, which would be almost 10 percent of his fiscal 2013 estimate of $183.1 billion for the company.



With assumed gross margins of around 40 percent on a full-fledged Apple television set, he sees the company gaining about $5.40 earnings per share, or about 11 percent of his fiscal 2013 EPS estimate of $48.46.



"Apple's eventual television could be so much more than a TV — including gaming, video, communication, content delivery, apps, computing and all the capabilities of the current Apple TV — it is not really fair to compare it to products already available on the market," Reitzes wrote.



His note to investors was issued soon after a Best Buy survey polled customers for their thoughts on a hypothetical Apple television set. The speculative survey questions described a 1080p LED flat panel display offering connectivity with iCloud and the ability to use an iPhone or iPad as a remote control for $1,499.



Reitzes is confident that the living room is Apple's next major target in the consumer electronics space, but he's not sold on the rumored television set launching in 2012. This year, he believes Apple will continue to focus on its next generations of iPads and iPhones.



Instead, he thinks Apple is more likely to launch a television set in fiscal 2013. Apple's next fiscal year begins in October.



"It appears more and more likely that the company is actively engaging partners about a potential device and content," he said. "If Apple were to sell a TV, we continue to believe its margins and pricing could be industry leading given its vertical integration with content. We believe that Siri could be used as a groundbreaking interface for TV,which could be used as a content hub — glued together by iOS and iOS devices."











The note from Reitzes also comes on the heels of a rumor from The Globe and Mail, which received information from an anonymous source on Monday that Canadian telecommunications companies Rogers and Bell Canada allegedly have an early version of the Apple television set in their labs. It was said that the content carriers are in negotiations to enter into a partnership for the device, which some have referred to as the "iTV."



Separately, another analyst report highlighted by AppleInsider on Monday also named Rogers and Bell as potential partners for Apple, along with AT&T and Verizon. Peter Misek with Jefferies said he thinks it's most likely that Apple will forge partnerships with existing cable operators for video content, and use that to supplement the offerings available on its iTunes Store.



[ View article on AppleInsider ]

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Comments

  • Reply 1 of 124
    Here's the problem with all those impressive numbers & statistics: IT HASN'T HAPPENED YET. LOL.
  • Reply 2 of 124
    The only valid comment Ben makes is that a full TV would most likely be at the top of the fiscal year, which is also he top of holiday shopping
  • Reply 3 of 124
    aizmovaizmov Posts: 989member
    Price it around $1300 - $1600 and I'm buying it!
  • Reply 4 of 124
    Quote:
    Originally Posted by Aizmov View Post


    Price it around $1300 - $1600 and I'm buying it!



    Make it at all and I'll never buy it.



    I will buy THREE A6 Apple TVs on the day of launch. I will NEVER buy an Apple HDTV.
  • Reply 5 of 124
    solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by Tallest Skil View Post


    Make it at all and I'll never buy it.



    I will buy THREE A6 Apple TVs on the day of launch. I will NEVER buy an Apple HDTV.



    I could use a new TV so I might ? which is not the same as thinking these rumours make sense as presented ? but I'd rather buy a set top box and then choose the specific TV I want from hundreds of choices.
  • Reply 6 of 124
    I haven't read a TON comments about the HDTV thing, but had a thought. This may have been covered before. But, with the idea of partnering, what if they subsidize the iTV purchase as cell phone carriers do with the iPhone? For example, sign a 2 year contract with Comcast and get a 50" iTV for $599....



    Thoughts?
  • Reply 7 of 124
    Quote:
    Originally Posted by Tallest Skil View Post


    Make it at all and I'll never buy it.



    I will buy THREE A6 Apple TVs on the day of launch. I will NEVER buy an Apple HDTV.





    Apple will probably discontinue the Apple TV
  • Reply 8 of 124
    it will be interesting to see how high Apple will be able to price a TV and still have it sell.



    Sony hasn't made a profit in 8 years on TVs

    Samsung, Panasonic, Philips etc haven't made a profit on TVs this year.

    Pioneer left the TV business because there wasn't a big enough market for high end products.
  • Reply 9 of 124
    Quote:
    Originally Posted by stationwagon268 View Post


    I haven't read a TON comments about the HDTV thing, but had a thought. This may have been covered before. But, with the idea of partnering, what if they subsidize the iTV purchase as cell phone carriers do with the iPhone? For example, sign a 2 year contract with Comcast and get a 50" iTV for $599....



    Thoughts?



    If Apple is still Apple, they won't be working with cable or satellite providers. They'll be killing them. It's not a 'revolutionary' device or 'cracking the TV' without killing the idiotic system we've had for so long.
  • Reply 10 of 124
    MacProMacPro Posts: 19,718member
    Quote:
    Originally Posted by Tallest Skil View Post


    Make it at all and I'll never buy it.



    I will buy THREE A6 Apple TVs on the day of launch. I will NEVER buy an Apple HDTV.



    The way I look at it is, if the day comes when I want to replace my largest TV, a 60" and Apple make one with ATV built in plus all the extra cool stuff and it is priced at the same as an alternative traditional TV plus an ATV, why wouldn't I buy the Apple iTV?



    On the other hand if I am not yet needing to replace I will live with the ATV and Sony for now and convince myself I don't need it ... My problem is I have zero use for a 42 inch other than maybe in a bedroom.
  • Reply 11 of 124
    solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by stationwagon268 View Post


    I haven't read a TON comments about the HDTV thing, but had a thought. This may have been covered before. But, with the idea of partnering, what if they subsidize the iTV purchase as cell phone carriers do with the iPhone? For example, sign a 2 year contract with Comcast and get a 50" iTV for $599....



    Thoughts?



    This has been presented before but the same issues are still unanswered.



    Why would Comcast want to sell a TV when they could just sell a set top box? Comcast and Apple will want you stay on that same Video 1 input on the TV so making it easier to switch to your Blu-ray player or whatever isn't in their best interest. Once you plug the TV's HDMI and power into the set top box it becomes a dumb monitor that allows you to hide the remote in a draw out of view.



    The beauty of the set top box is that it's easier to distribute, easier to sell, can be sold at a lower price than a TV yet have a higher profit per unit, can be sold to more consumers because 1) its cheaper, 2) it doesn't mean consumers have to get rid of their currently work and perfectly fine TVs, and 3) because they connect more units to more TVs in their home instead of just on the primary TV in the living room.



    Nothing about a partnership with content providers makes putting the AppleTV HW in a TV a more lucrative maneuver. The only HW that would really only work in that sense are any cameras (FaceTime) or motion sensors. However the former has issues because TVs are not placed directly in from of the face the way FaceTime cameras on Macs and iDevices are. Mics for Siri would likely have to be placed in the remote control. You can't have it that far away from the speaker and you still need to initiate Siri with a button press. I doubt some elaborate hand gesture will work for this.
  • Reply 12 of 124
    MacProMacPro Posts: 19,718member
    Quote:
    Originally Posted by FriedLobster View Post


    Apple will probably discontinue the Apple TV



    OMG ...I never even considered that before... You never know you could be right. It was only a hobby after all.



    You make me feel like running out and getting a another one while the going's good (now I think about it BestBuy haven't had them in stock for weeks) ... but then again would they continue to support existing ones ... That would really be bad ... we gave up TV in favor of really fast FiOS (upgraded) and Netflix and ATV!!!



    You were just kidding .. right ..
  • Reply 13 of 124
    tjwaltjwal Posts: 404member
    Quote:
    Originally Posted by FriedLobster View Post


    Apple will probably discontinue the Apple TV



    Maybe but there are lots of other choices. Even an older mac mini blows the socks of the ATV.
  • Reply 14 of 124
    al_bundyal_bundy Posts: 1,525member
    Quote:
    Originally Posted by SolipsismX View Post


    This has been presented before but the same issues are still unanswered.



    Why would Comcast want to sell a TV when they could just sell a set top box? Comcast and Apple will want you stay on that same Video 1 input on the TV so making it easier to switch to your Blu-ray player or whatever isn't in their best interest. Once you plug the TV's HDMI and power into the set top box it becomes a dumb monitor that allows you to hide the remote in a draw out of view.



    The beauty of the set top box is that it's easier to distribute, easier to sell, can be sold at a lower price than a TV yet have a higher profit per unit, can be sold to more consumers because 1) its cheaper, 2) it doesn't mean consumers have to get rid of their currently work and perfectly fine TVs, and 3) because they connect more units to more TVs in their home instead of just on the primary TV in the living room.



    Nothing about a partnership with content providers makes putting the AppleTV HW in a TV a more lucrative maneuver. The only HW that would really only work in that sense are any cameras (FaceTime) or motion sensors. However the former has issues because TVs are not placed directly in from of the face the way FaceTime cameras on Macs and iDevices are. Mics for Siri would likely have to be placed in the remote control. You can't have it that far away from the speaker and you still need to initiate Siri with a button press. I doubt some elaborate hand gesture will work for this.



    if comcast can get rid of having millions of old cable boxes it has to support it will partner with apple. if a new apple tv will save comcast money from buying new boxes they will do it
  • Reply 15 of 124
    I still think its the home theater receiver that's the real piece of crap. Come on, right down to the little monochrome LCD display. Swiching between devices is the biggest pain in the ass. T ere is a volume control on each device( When i plug my ipod in to the dock it is the only device smart enough to disable its own voume control). That's what needs to be redone. The tv is just a screen. The big question would be how much amplifier power you would want to run the speakers
  • Reply 16 of 124
    Quote:
    Originally Posted by Tallest Skil View Post


    I will buy THREE A6 Apple TVs on the day of launch. I will NEVER buy an Apple HDTV.



    What if it had some compelling features which were missing from the Apple TV box?
  • Reply 17 of 124
    solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by tjwal View Post


    Even an older mac mini blows the socks of the ATV.



    In HW specs, sure, but an AppleTV is designed to work on a TV. If you connect a Mini to your TV you are wasting a lot of HW and functionality that Front Row doesn't support, and paying a lot of extra money for the limited usability.





    Quote:
    Originally Posted by al_bundy View Post


    if comcast can get rid of having millions of old cable boxes it has to support it will partner with apple. if a new apple tv will save comcast money from buying new boxes they will do it



    It was pointed out yesterday that cable companies get quite a lot of money off renting the equipment. I can see your point if these Moto, SA, et al. cable boxes are a loss leader but I'm thinking they are not. If you consider service and support it's simple to test and replace a box so I'm not sure that they will save much by letting Apple take over and losing control of an important part of their setup.





    PS: Why are cable boxes and cable modems separate devices. I see no reason why these can't be one device.
  • Reply 18 of 124
    What a nonsense story. If Apple built rocket ships they would probably be the galactic leaders with over 50% of the market.



    Try giving us some real news.
  • Reply 19 of 124
    Quote:
    Originally Posted by Tallest Skil View Post


    If Apple is still Apple, they won't be working with cable or satellite providers. They'll be killing them. It's not a 'revolutionary' device or 'cracking the TV' without killing the idiotic system we've had for so long.



    I disagree. It'd be no different from a model where they work with mobile service providers with the iPhone/iPad.



    Apple will (and should) have no interest in the pipe business.
  • Reply 20 of 124
    Quote:
    Originally Posted by I am a Zither Zather Zuzz View Post


    What if it had some compelling features which were missing from the Apple TV box?



    I'm of the belief they'd only sell one or the other. I'm also of the belief they'd not make a TV at all, but that's me.



    The only box that will be missing features is the current Apple TV which won't get the update to the next one's software. That's just how Apple rolls.



    Oh, and to answer the question, I still wouldn't get it. I've no use nor desire for an integrated TV when buying ANY TV and a $99 box is a much better solution.
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