Tue, 05 Mar 2013 Will Apple take on TV? Your questions answered

The web has lit up with claims that Apple is going to launch its own television set at some point this year or next. The excitement was first fuelled by Steve Jobs’ comments to his biographer that Apple had “cracked” television, and then fanned by CEO Tim Cook, who has described television as an area of “intense interest” for Apple. This is interesting given the fact that the company had previously described its Apple TV set-top box as “a hobby”. 

So what’s changed? Will Apple really transform our living rooms with its own take on what we should have on the box? And, the question on everyone’s lips: when? 

TV or Not TV... that is the question

Is Apple Really Going to Launch a Television? 

Last year, Tim Cook revealed Apple is “interested in TV” and will keep pulling strings to see where it leads. 

Piper Jaffray analyst Gene Munster has been claiming that the Apple television set is on its way since at least 2009. Then every autumn, without fail, he admits he was wrong, but watch this space: this year we’ll see it, he claims.  

Munster has, however, started to look less leftfield in the past couple of years thanks to Steve Jobs’ comments to his biographer. Walter Isaacson’s authorised biography seemed to reveal the company had made a breakthrough with the TV. “He very much wanted to do for television what he had done for computers, music players, and phones: make them simple and elegant,” wrote Isaacson.

“‘I’d like to create an integrated television set that is completely easy to use,’ he [Jobs] told me. ‘It would be seamlessly synced with all of your devices and with iCloud.’ No longer would users have to fiddle with complex remotes for DVD players and cable channels. ‘It will have the simplest user interface you could imagine. I finally cracked it.’”  

Then, on a couple of occasions last year, Apple CEO Tim Cook made comments that the television is an area of “intense interest” for the company. In December, he told an NBC interviewer: “When I go into my living room and turn on the TV, I feel like I have gone backwards in time by 20 to 30 years. It’s an area of intense interest. I can’t say more than that.” 

Cook also spent some time talking about television at the D10 conference last year. He referred to the Apple TV set-top box, hinting there may be more potential. Apple’s CEO also noted that, for many, television is “an area in their life that they’re not pleased with” and suggested Apple will “keep pulling this string and see where it takes us.”

So Apple’s Interested in Television. Might it Just Update the Apple TV? 

Could Apple’s advanced set-top box erase the distinction between live and on-demand TV?

Most of the excitement surrounds the idea that Apple might have an actual television in the pipeline, however, many are speculating that it might intend only to update the Apple TV set-top box in such a way that the company might be able to transform television without even having to build a telly of its own.

However, there’s a lot of evidence that points towards an actual Apple television set, so we can be fairly certain the company is at least considering launching something of the sort. For example, during the summer of 2011, a former Apple executive, who spoke on the condition that he remain anonymous, claimed that: “The company’s biggest upcoming product launch” would be its entry into the flat-screen television market, and would “blow Netflix and all those other guys away”.

There have also been reports from the Far East claiming that there’s a fully-fledged Apple television already in production. 

However, in late August 2012, the Wall Street Journal suggested that Apple has changed its mind about making a television set, and is instead focusing on taking over the living room with an advanced set-top box that will “erase the distinction between live and on-demand TV”.

In the short term, it’s likely that Apple will role out new features to its existing set-top box, and maybe introduce a revamped model. In doing so, it could test the waters for its television set. 

Of course, there’s still one voice calling out that Apple will announce a television this year. Gene Munster told Bloomberg: “The core of the debate is an improved set-top box… a hockey puck that attaches to your TV, or an actual television. 

“Based on our work, in part, with taking to suppliers in Asia, to talking with people in the industry, we think it’s an actual television.”

Wouldn’t Apple be Wiser to Update the Apple TV? 

There’s a school of thought that Apple would be better off concentrating its efforts on developing its current Apple TV device, rather than pursuing the idea of an actual television. 

However, some reports suggest that even the Apple TV, for so many years described by Apple as a hobby, is a dead end. The market for set-top boxes is a growing one, according to IHS iSuppli, but it’s still insignificant when compared to other markets, such as smartphones. 

One reason for this is that more and more smart TVs have the functionality built in. So why buy a separate box? 

However, in Apple’s favour is the low price of the Apple TV unit, which is a bargain at £99. 

Should Apple Launch a Television?

A television would eat up a lot of retail space in Apple’s stores. 

Last May, an analyst poured cold water on rumours of an Apple television. Pacific Crest analyst Andy Hargreaves’ argued: “An Apple television would be a terrible use of retail space relative to iPhone, iPad or the Apple TV set-top box. A 46in Apple television would likely generate less than 1/200th the gross profit per cubic foot as an iPhone at retail, and less than 1/50th the gross profit per cubic foot of an iPad.”

In other words, a television takes a lot more space up in store than an Apple TV set top box, and that’s space that could be used to sell other Apple products. 

There’s another reason why an Apple television may be a drain on the company’s profits. According to NDP DisplaySearch, TV sales have stagnated over the past two years, and growth is expected to be slow in the coming years. As proof of this, in 2012 Panasonic announced it was pulling out of the TV market, while earlier this year Philips announced it was moving out of the home consumer market. 

What Will the Apple Television be Called?

UK TV broadcaster ITV has reportedly made it clear what Apple shouldn’t name its television.

You’ll probably have noticed that we avoid referring to the Apple television as the iTV. Although, many have already dubbed the set ‘iTV’, it appears the British broadcaster has written to Apple to request that it doesn’t use the name ‘iTV’. 

You may remember that when Apple first announced its set-top box in a keynote in September 2006, it was called the iTV, then when it was launched the product was named the Apple TV. There was a reason for that. 

Another suggestion is that the television will be called ‘iPanel’. However, there’s no solid conclusion about what the company will call its television. Perhaps it will adopt the Apple TV name from the set-top box that bridges the gap between the internet and a standard set, although we imagine that Apple would continue to sell this £99 device. Although the company would be wise to avoid any confusion with the Apple TV, an existing product, if it wants to make its smart TV set consumer-friendly.