Among the weapons in Apple’s diverse arsenal, most are currently enjoying more than a modicum of success. Sales of the iPod, the iPhone, and even the Mac have all been performing beyond expectations, but even Apple can’t win them all. While the other product lines have flourished, the Apple TV has languished; to many it’s the ugly duckling of the Apple lineup, the swing-and-a-miss alongside numerous home runs.
Forrester Research analyst James McQuivey has gone so far as to revise their estimated sales figure for the Apple TV:
“In addition to the 400,000 Apple TV units we estimate Apple has sold thus far, the company will be lucky to sell another 400,000 in the year-end holiday rush, short of our one million estimate…Unfortunately, the same lack of interest in iTunes video will mean the iPhone and the iPod touch have less video momentum to ride.”McQuivey also went on record last week saying that iTunes needed to get NBC back on board and switch their model to rental from download-to-own. Both moves that I think will help them, though I don’t think the situation is quite as dire as McQuivey suggests.
Back in July, I wrote a bit about the Apple TV, and I think what I said then still holds true now:
I like to think of it more as Apple’s beachhead in the living room, a foothold for future expansion. There’s no question that Apple will be adding more features to the Apple TV—they’ve stated that much in the past, and have shown it in action with the YouTube update.While Jobs may not “get” the living room market, in the same way that Apple has historically not appealed to other categories like games, he’s smart enough to realize that this is going to be the next major theater of the digital media revolution. And the living room is by far the most important market to capture for digital video in particular. Music’s key is portability, the ability to have it with you wherever you go, but the same is not true of video. Most people don’t watch video on the go, no matter what cell phone manufacturers and providers would like you to believe: it simply takes too much attention. I have both an iPod video and an iPhone, and while I use them all the time for playing music, I can count on one hand the number of times I’ve watched video on them. Typically that happens in one of two realms: when I’m on a plane or in a car (as a passenger people, don’t freak out), or when I’m showing off the video-playing capability to someone else. But sitting down to watch a feature-length film on them? Even with the iPhone’s gorgeous screen, it’s far more painful than using my laptop or television.
It doesn’t really surprise me that Apple TV sales have been lackluster: as a product, it’s not quite there yet. But I think it was important for Apple roll out the Apple TV at the moment when they did, to at least acknowledge the living room market and say “Hey, we’re working on this, and it’ll get better.” We’re so used to seeing 1.0 products from Apple that amaze and astound us, like the iPhone and the iPod, but the Apple TV is more like a beta version of what’s to come. The lynchpin is software, and that’s where the Apple TV has an advantage over much of its competition (at least, in comparison to “old school” mediums like DVD); all the hardware ingredients are there. To those who complain that it doesn’t have a TV tuner or an optical drive, I say that’s because Apple is looking to the future in the same way it did when it dropped floppy disk drives from the original iMac. It may seem rash now, but that’s because they’re looking forward, streamlining the device and removing the vestigial features of the media past. When Apple rolls version 2.0 of the Apple TV software, which will almost certainly happen in the next calendar year, well, that’s when the present becomes the future. Remember, after all, that even the ugly duckling becomes a beautiful swan in the end.
One thing to remember is that the Apple TV only works with HDTVs, and there are still plenty of us who don't have HD.
Kirk
I have two problems with the Apple TV.
Right now, I only have a standard definition television. I haven't had a lot of luck getting the component input to work on this TV. I would have been a lot more likely to buy one if it had a composite cable.
In the near future I will get an HDTV and at that point I could think about getting an Apple TV, but it doesn't do high definition output.
So, the Apple TV doesn't seem right for me now since it won't plug in to my TV using the cables I'm familiar with and it doesn't seem right in the near feature since it won't take advantage of the resolution of my new TV.
Apple TV can't do what I want it to do and I suspect there are others out there who share a similar frustration.
I want a simple, easy way to take streaming video content from my computer to my television.
When I wanted to catch up with Dirty, Sexy, Money, I went to the ABC web site. When I wanted to find out what all the buzz was about Jericho I went to the CBS web site.
I buy songs all the time from iTunes, video? I've bought two tv shows ever. An episode of Lost when the start was delayed and I missed the final minutes and an episode of 30 Rock when local bad weather alternately knocked out my satellite signal and caused the local weather guy to be on the screen the rest of the time.
Buying video just isn't something I do because I rarely watch an episode twice.
Rental model? Better but I doubt the price difference would be compelling.
But streaming? That's another story. I know plenty of sports freaks who, like me, lug a laptop into the living room and plug it in to the TV to get extra football or basketball games. Online only video of games not telecast on regular TV or unavailable in the market are commonly available online from many colleges for as little as $8 a month, all you can eat. ESPN offers its ESPN360 service to some ISPs and the content is usually quite similar to the PPV ESPN packages.
Online streaming is the game for many of us watching sports and using the networks limited commercial interruption webcasts as an extra DVR and Apple TV doesn't serve that market and so far no one else offers a compelling box that does the job either.
That's not entirely accurate -- Apple TV can display 720p video at 24 frames per second -- in other words, HD movies and anything else made on film.
Kirk makes an important point. When I get an HD TV, the first thing I'll do is get an Apple TV. The problem is that the industry botched HD as far as I'm concerned. Too many standards (Blu-ray vs HD-DVD, 720i vs 720p vs 1080i vs 1080p, let's not dicuss EDTV) and the return of cable boxes (am I the only one who thinks we've gone back to 1983 with these damned boxes?) make me loathe to invest a lot of money (I am convinced that the lesser standards exist to keep the prices high on better sets rather than let the economies of scale bring the prices down naturally) in an HD set and content package.
@fletcher, that's just wrong, the Apple TV outputs 720p. You just have to get the HD content onto it. It would be nice if it up-sampled like high-end DVD players. Make that my top feature request (and where's the access to the iTunes Store we were all expecting when iTunes WiFi store was unveiled?).
I looked at the AppleTV at a store and I thought "yuck". I looked at a Playstation 3 at a store and I thought "wow". PS3 does pictures, music, games, and awesome quality movies.
Apple TV seriously needs some love back from Apple.
I think it's crazy that Apple won't even push a copy of their product announcements and keynotes into a format suitable for the Apple TV. They want me to sit and watch 2 hours of Steve and all his goodies but won't let me watch it from the couch!
I love my Apple TV but worry that it will suffer the same fate as the Apple Hi-Fi and Apple designed iPod case that seem to have disappeared...
According to Nielsen there are about 15.5 million US households with HD TVs and HD Tuners.
Neilsen Gives Fuzzy Picture of HDTV Penetration
Apple has sold approximately 400,000 Apple TVs. That is about 2.5% market penetration if most were sold in the US. Is that really a flop? If they get to 5%, is that a flop?
I guess the question is, are Apple TVs widely used outside the US?
The problem with the AppleTV is this: outside the US it's near useless and even in the US the level of content available for it is limited. AppleTV will never be a success unless Apple, or other partners, make available content that can be played on it. Currently the only source of content for the thing is your own music/photos/movies and whatever it is that you've bought from the iTunes Store (the selection from which seems to get smaller rather than larger at present). In the US the selection of TV shows is/was reasonable and and a few movies, the UK gets a few TV shows, but outside of these locations there is NOTHING. So why would anyone buy it?
I'm sure the hardware and software for the AppleTV is fine but until the content is available for it there is no point in its existence.
The lack of a widescreen TV is another nail in its coffin for me although that at least will change in the next few years.