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Apple’s tiny new $99 Apple TV could pressure offerings from Amazon, Google

Thursday, September 2, 2010 · 3:16 pm · 19 Comments

“When Apple Inc. lifted the wraps off its redesigned Apple TV device on Wednesday, the company clearly signaled its intention to grow that business from its current ‘hobby’ level into a viable alternative to mainstream cable TV and satellite services,” Dan Gallagher reports for MarketWatch.

Advertisement: The all-new Apple TV is just $99. You know you want one. Free shipping.

“‘We view yesterday’s announcements from Apple as marginally positive for Netflix and increasingly competitive to Amazon and Google,’ Marianne Wolk of Susquehanna wrote in a note to clients Thursday morning,” Gallagher reports. “Colin Sebastian of Lazard Capital Markets wrote in his own report that Apple’s move — and the corresponding price cut from Amazon — could spark a price war in the online TV category. ‘We believe that the move potentially sets the stage for increasing price competition among providers of online video, even as key players such as Netflix, Hulu and, eventually, Amazon offer subscription alternatives,’ Sebastian wrote.”

Gallagher reports, “Yari Reiner of Oppenheimer wrote that Apple TV allows the company to expand its popular iOS operating system and iTunes library into more markets.”

Full article here.

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Comment Feed

19 Comments

rick

Thursday, September 2, 2010 - 3:41 pm · Reply

will this be the beginning of the end for redbox?

Blockbuster, at 7 cents a share, might as well not even bother with kiosks
Jersey_Trader

Thursday, September 2, 2010 - 3:51 pm · Reply

Not until now could Apple offer streaming with limited storage because the billion dollar server farm was not up and running yet. It is powered up!
LordRobin

Thursday, September 2, 2010 - 3:55 pm · Reply

Am I the only one who doesn’t get what the hell they’re talking about? “The corresponding price cut from Amazon”?? Price cut on what? They don’t have a competitor to Apple TV. I presume they’re talking about the Kindle, but what does that have to do with anything?

“Apple TV allows the company to expand its popular iOS operating system … into more markets.” Uh, no it doesn’t. The new Apple TV isn’t an iOS device.

It is so f***ing depressing that people actually get paid to write this sh*t. Talk about not even trying.

——RM
Maconymous

Thursday, September 2, 2010 - 3:56 pm · Reply

Can anyone who owns a current Apple TV tell me if it recognizes DLNA servers? I assume the new one only works with iTunes, which can’t be installed on any server other than ones running OSX.
MidWest Mac

Thursday, September 2, 2010 - 3:57 pm · Reply

It will be interesting to see if NBC and CBS come along for the ride.

Digital media distribution is relatively young, and I can see why they hesitate. Depending on the app, a lot less up front money could go into producing it than is true of television and movies. In other words, they’d have to sell a lot of them at .99 to make a profit.

There is always a “sweet spot” when it comes to digital media — the point at which the flood gates open. If you slash your price by a third but bring in four times the customers, you just made money. But if you only bring in double the customers, you lost money.

Not surprised these networks are taking a wait and see approach.

(I’m buying the thing because it’s only $99 and it can get me HD movies cheaper than VOD, PPV, etc.)
Justatecfan

Thursday, September 2, 2010 - 3:59 pm · Reply

(I’m buying the thing because it’s only $99 and it can get me HD movies cheaper than VOD, PPV, etc.) DITTO!!
OpJ

Thursday, September 2, 2010 - 4:11 pm · Reply

Maconymous: iTunes covers Windows and OS X. For linux, it will depend on whether it is compatible with Firefly or not. Firefly does regular iTunes streaming from linux boxes, but doesn’t do authenticated access that current AppleTV wants.
chabig

Thursday, September 2, 2010 - 4:47 pm · Reply

@LordRobin,

Amazon doesn’t sell an AppleTV device, but they sell television programming. The competition isn’t between devices. It’s a competition to deliver content. And the AppleTV may be running iOS or it may not–Apple hasn’t said.
ken1w

Thursday, September 2, 2010 - 4:47 pm · Reply

As released, this new Apple TV is obviously NOT meant to replace cable TV service (for most people). But it may displace “optional” services that cost extra (either recurring or per use), such as Hulu Plus, BlockBusters, Pay-Per-View on cable, and whatever Google and Amazon are doing. I’d put NetFlix on the list, except Apple TV will probably help NetFlix get more subscribers in the near term.

For $99, a lot of people will try it. They will find that it provides Internet-based services with a simple elegant interface (a remote control with seven buttons), and without the complexity of a full computer connected to the HDTV. Over time, Apple’s plan is to slowly displace more and more of what people do using cable TV and those other services.
@Lord Robin

Thursday, September 2, 2010 - 4:48 pm · Reply

Yes, it most likely is running iOS. People seem to be under the belief that iOS was designed for direct manipulation. UIKit was designed for that. iOS comprises many layers of which UIKit is but one. Apple defines iOS as an “innovative mobile operating system” (mobile being synonymous with low-power/low-footprint). There is no denying that the new AppleTV falls into the “mobile” category. A change to UIKit would be all that is needed to support iOS.

Note: “running iOS” does not equate to “running current touch-based iOS apps.” I do not believe that will ever happen due to usability failings but, AppleTV will, in the future, gain an SDK for app development with iOS getting a modified UIKit to support the new UI. I believe that what we see here is a — currently private — change to iOS to support this new device.
cw

Thursday, September 2, 2010 - 5:03 pm · Reply

H.264 video up to 720p, 30 frames per second…
Well… that’s better than Blu-ray isn’t it.
O.K. it’s cheap.
But can it download 4K 3d, or any HD? It’s cheap. It will sell. Good for Apple.
Now can I get get some insanely great something or other?
Does anyone know if Panasonic plasma uses 6 bit per color, then uses dithering for the rest?
Best, most exciting thing out there now, is 3d (plasma?), 3d movies, and 3d games, 3d cameras, and 3d editing.
Apple could have anounced a deal with Red to provide 4k somehow. Maybe in the future. Hey, wait a min. Didn’t the “old” Apple tv give 1080 (1440 x 1080? 1920 x 1080?).
Once enough movies come out for 3d blu-ray, I’m there. Sorry, that’s more interesting, and BETTER quality.
You know Damm well, that if MS had 720p 30 fps and Apple had 1440 x 1080 (or better), people would be insulting, laughing, putting down MS. Let’s just be for real shall we? But it will sell.
ken1w

Thursday, September 2, 2010 - 5:10 pm · Reply

@ “@Lord Robin”

You are wrong. The UNIX-based core of iOS, Mac OS X, the OS of the old Apple TV, and the OS of this new Apple TV are related. But saying the Apple TV uses iOS is like saying Macs uses iOS.

What distinguishes “iOS” is the interface (the GUI), NOT what is beneath the GUI. Just go watch at about 4:45 minutes in the “keynote” from yesterday to hear Steve Jobs say it himself. “iOS is the operating system that powers our MOBILE DEVICES and it’s been a revolution in both TOUCH and apps.”

And no, just because it is small, an Apple TV is NOT a mobile device. You connect it to an immobile HDTV and it stays there.
January 24, 1984

Thursday, September 2, 2010 - 5:26 pm · Reply

Or maybe you take AppleTV on the road and have access to everything. That’s mobile.

Imagine being in a hotel room, your AppleTV hooked wirelessly to your MobileMe account. Your everything everywhere.

And also to everything in the iPad in your hand.
Mike

Thursday, September 2, 2010 - 5:59 pm · Reply

@ rick:

nope. Redbox offers Blu-Ray, and Blu-Ray rules the video quality battle. No streaming or download service even comes close.

What’s killing Blockbuster is the fact that they overpaid for “prime” real estate, so they have no cash to do anything … including train helpful employees.
@ken1w

Thursday, September 2, 2010 - 6:40 pm · Reply

I disagree. Did he say “iOS is the operating system that powers ONLY our mobile devices…”? No, he did not. Did he say that iOS is ONLY for mobile devices? No, he did not. Yes, iOS is used on their mobile devices but, that does not mean it cannot be used on their non-mobile devices.

For the record, I never said AppleTV was a mobile device. I said it was in the “mobile” category hence the quotes. I thought I had clarified what “mobile” means in this view.

Google calls Android a “mobile-device OS” which is destined for “non-mobile” devices. They do not know any better and are classifying the OS incorrectly? My company is creating a device to go into ambulances and hospitals. We are using a “mobile Linux” distro. Why? because its capabilities are suited for the hardware we are designing; the device itself is not mobile.

You are saying that out of all the subsystems in iOS, the one specific interface piece, UIKit, defines the whole of iOS? iOS is much, much more than the touch interface — don’t sell it short. I highly doubt Apple has created yet another hybrid OS for one device when iOS is a perfectly fine choice for the device.
dwimmy

Thursday, September 2, 2010 - 6:43 pm · Reply

Redbox has blu-ray now? Must only be in a limited area right now: definitely not up here in MA.
ken1w

Thursday, September 2, 2010 - 7:29 pm · Reply

@ “@ken1w”

As I said, the core of all Apple’s systems (above the iPod shuffle, iPod nano, and iPod classic) are related. If you want to call them all “iOS” because their foundation is the same, then you are right. But if like most people with common sense (including Steve Jobs), the name “iOS” is defined as Apple’s touch-based OS for “mobile devices,” then you are wrong.

> There is no denying that the new AppleTV falls into the “mobile” category.

There is no denying that the above sounds like you are saying Apple TV is a “mobile” device.
RickW

Thursday, September 2, 2010 - 9:42 pm · Reply

I own ATV1 and I really don’t see what all the fuss is about with this new device. Yes, it’s small, but here are my issues with this thing:

1. You cannot save anything. No TV shows, No movies, nothing. For the same price of 99 cents, Amazon as of yesterday is allowing you to KEEP your TV shows.

2. There is still no inclusion of DIVX, AVI, MKV file formats. Somehow I don’t think that Apple recognizes this as a major deal breaker for many.

3. What the hell is the USB slot for (or more correctly, MicroUSB)?

4. Why is there no ability to place a USB stick in the device and have it play the media immediately?

5. Want to change television? How about an App store for the AppleTV?

6. To quote Apple’s own site:
H.264 video up to 720p, 30 frames per second, Main Profile level 3.1 with AAC-LC audio up to 160 Kbps per channel, 48kHz, stereo audio in .m4v, .mp4, and .mov file formats.

Main Profile level 3.1? Are you kidding me? The current standard is 4.1. I’ll give you the 720p for a bandwidth issue, but really 3.1?

6. I really thought that the Killer thing for this device would have been MobileMe or some use of the Server Farm that they are creating. ie. Save your movies in the cloud and stream it anytime you like.

Sorry, I am an Apple fanatic, but this device just failed to move me and makes me want to consider rooting my current device to make it more useful. This device really does smell of Google Bait Panic and not the “hobby” that Steve says it is. Mark my words, you put removable storage and divx playback on this device and it’s off to the races. Right now, it looks like another Netflix Gateway, aka Roku Box.
@ken1w

Friday, September 3, 2010 - 8:04 am · Reply

It has Been Confirmed that Apple TV “New” is and is running the “IOS” Mobile Framework.

Due to the device using the same A4 Chipset and the “IOS” platform being coded to that particular chipset tells you right away that it is.

The only thing that is different this from this “IOS” framework is the TOUCH interface has been replaced by a “Static” Remote Non Touch Interface that can be used by other devices other then “Physical Touch Control”.

Don’t be surprised to see a Apple TV SDK Soon near release to allow 3rd party Application Programing.

Plain and simple the “IOS” framework has been already written to Perform with the A4 Chip, Apple has Proprietary code in the A4 chipset that Only allows the Mobile “IOS” to Link to those features.

And ad reported so many other places, “IOS” is the Framework in the New Apple TV.

But your your opinion is your own – .

Nice thing about opinion you can believe it or Not believe it.

And I stand by that even with what i have just wrote…

Enjoy.