TV analyst says Apple TV will bomb

Apple Store“Apple has finally begun shipping pre-orders of its Apple TV wireless set-top, according to news reports. The device can stream media stored on your PC to your TV including music, pictures and 720p High-Definition video,” Phillip Swann writes for TV Predictions. “The company has set the price at $299, but I’m here to tell you that it will ultimately have trouble giving them away.”

Swann writes, “Yes, Apple TV will bomb — and here’s why:”

1. Limited Uses
2. Set-Top Fatigue
3. Compatibility & Confusion
4. Inconvenient

Swann writes, “So, although the tech-intelligentsia will slobber over Apple TV and call it the Second Coming, Apple TV will fail to reach beyond the cultish Mac audience, probably topping off at about three million homes.”

Full article, Think Before You Click™, here.
Good news for Apple! This is the strongest indication yet that Apple TV will be a raging hit as Swann has proven to be uniformly wrong when it comes to understanding Apple products and predicting their success.

Read Swann’s previous idiotic predictions:
TV analyst says Apple’s video-capable iPod is a bust because he says so – May 03, 2006
TV analyst blows it, says Apple’s 12 million video downloads ‘a big disappointment’ – February 08, 2006
TV analyst’s uninformed prediction: ‘video iPod will be Steve Jobs’ folly’ – October 12, 2005

Related articles:
Mossberg hands-on with Apple TV: ‘beautiful design, easy-to-use, classic Apple: simple and elegant’ – March 21, 2007
Apple TV projected to surpass TiVo, Netflix – March 20, 2007
Former Microsoft ‘Enthusiast Evangelist’ Gartenberg looks at impact of Apple TV – March 20, 2007
Apple TV ships – March 20, 2007
Apple shares rise on positive Apple TV analyst comments – March 19, 2007
Analysts: Apple to ride Apple TV + iTunes ‘Trojan horse’ into living room – March 19, 2007
Will Apple TV be even bigger than iPhone? – March 19, 2007
Apple adds 720p Apple TV high-definition export mode to QuickTime – March 19, 2007
Apple planning to buy Miglia to add DVR capabilities to iTunes and Apple TV? – March 17, 2007
Miglia debuts TVMAX+ Mac PVR, TV tuner, content provider for iPod, iPhone or Apple TV – March 16, 2007
Piper Jaffray expects 2 million Apple TV units to be sold in 2007 – March 16, 2007
Apple TV ships – March 15, 2007
Solution providers expect Apple TV to be hot seller – March 15, 2007
Apple TV could help kill traditional TV ads – March 14, 2007
Apple TV manufacturing ramp up to begin as early as today – March 12, 2007
Why Apple TV is more important than iPhone – March 12, 2007
Apple TV concept may eventually catch on with consumers – March 12, 2007
Apple CFO talks Apple TV, iPhone, Leopard and retail (link to full transcript) – March 07, 2007
PC Magazine: Why Apple TV matters – February 23, 2007
Bear Stearns: Apple TV and iPhone have changed the Apple story for the better – February 21, 2007
Deutsche Bank: Apple TV could take 30% of set-top box market within a few years – February 21, 2007
How do Apple TV and Elgato’s EyeTV work together? – February 16, 2007
Apple embraces casual gaming; iPhone, Apple TV to join iPod as gaming devices – February 09, 2007
Former GM of Microsoft’s Xbox Live Arcade: Apple TV to become video game console – February 08, 2007
ZDNet’s Graham: Apple TV hits a number of sweet spots, poised to make a big impact – January 25, 2007
Is Apple out to kill cable television? – January 25, 2007
RUMOR: Apple TV sales blowing away Apple’s internal expectations – January 25, 2007
Steve Jobs: Apple TV is the ‘DVD player for the 21st century’ – January 22, 2007
Apple TV beats out iPod, hits top spot on Apple Store sales chart – January 19, 2007
Report: first batch of 100,000 Apple TVs to ship this month – January 11, 2007
Steve Jobs moves to control the living room with Apple TV – January 10, 2007
Analyst Bajarin: Apple’s iPhone and Apple TV are industry game changers – January 09, 2007
Apple premieres Apple TV: movies, TV shows, music & photos on your big screen TV – January 09, 2007
RUMOR: Apple may enter video game market – December 05, 2006
Could Apple become king of game consoles? – September 26, 2006

66 Comments

  1. I’m not convinced that the Apple TV will be a rousing success right away, but I highly doubt that they’ll bomb though either. They’ll certainly be more successful in the market place than those lousy Media Center PCs have been. Those have truly bombed…

  2. What he fails to realize is that Apple knows how many videos it is selling online, especially to the same account.

    Apparantly Apple can see exactly how much market potential there is.

    The iTV doesn’t necessary have to be as successful as the iPod, just look at the POS called the iPod Boombox.

    Apple sold enough of those in order for it to be profitable and that’s all that counts.

    Some products Apple makes is not designed to rule the roost in it’s market, but to serve the advancement of Apple in the living room.

  3. this “swanni” guy is clearly an ass

    he is just trolling for hits on his website so he can continue to milk web ads

    has he tested the product ?

    why release this “opinion” now ?….because he wants to piggyback off of Mossberg’s real story and be picked up in the mainstream press as the opposing viewpoint

    low life web scum

  4. > what happened to accountability and performance-based employment?

    Because in his line of business controversy is performance. He’s there to drive hits to the web site, so outrageous statements or positions, often with no regard for the real world, are the order of the day.

  5. I don’t think it’ll be a big success, either. As statistics have shown, iPods are filled with MP3s people have ripped or pilfered. Only a small percentage of songs on iPods are AACs from iTunes. So, in similar fashion, Apple needs to support the de facto video standard codec to have AppleTV be similarly successful. I know it’s not the best quality video, but AVIs are the de facto standard right now. I would buy an Apple TV if it supported AVI as there are European TV shows I like to download and watch on my Mac (that aren’t even available on iTunes), but won’t be able to stream them to my TV with Apple TV.

  6. “wall street guy” is spot on

    why release this “story” now ?

    why not wait 3 days and give a real informed opinion after actually using the product ?

    and the biggest question, who the hell is stupid enough to subscribe to this guy’s service ?

    DO NOT CLICK THE LINK TO HIS WEBSITE !!!!

  7. First, he wants hits to his article. Second, I said this would happen– huge build up, then the tear down. It started a bit early, though considering it’s hasn’t even begun to arrive in peoples’ homes yet.

    Time will tell.

  8. 1. Limited Uses
    DVD players don’t deliver TV broadcasts, TV tunes don’t play dvd’s. As long as the content itself is compelling enough it makes no difference how many different things it does.
    2. Set-Top Fatigue
    So people have stopped buying new devices? Hasn’t stopped the wii doing well. As long as the content it delivers is compelling then people have shown they will buy something new.
    3. Compatibility & Confusion
    The Apple TV does not emulate a windows media center, that’s the whole point. If people can use iTunes (which they can and do) then they can use this.
    4. Inconvenient
    In order to watch a dvd you have to buy or rent it – what’s the point?

    As long as the content is compelling enough to outweigh any perceivable disadvantages of a product then it will succeed. Apple TV may fail, but not for these reasons, or at least the explanation of them given in this article.

  9. Reading this article is just trading one fanatacism for another, and if I’ve gotta pick fanatics then I’m going to pick on the side of Apple Fanatacism.

    I’ve been choosing, buying and recommending Apple products, mostly it’s computers, since 1985, for home and work, and have never regretted one moment of it. I was choosing Apple when it was popular and not succeeding as well as Windows, I was choosing Apple when it wasn’t popular and not succeeding, and I’m still choosing Apple. And now it’s not only the smart thing to do, its becoming the popular thing to do, the pay-off for sticking with Apple products just keeps getting better and better.

    Apple is not perfect, but neither is anything else, and as I’ve done since 1985, I dare anyone to actually research their Apple products carefully and objectively, and almost everytime you are compelled to admit that the Apple product is the way to go. I think iTV is a done deal, I think iPhone is a done deal, and I think the Macintosh is quickly becoming the done deal it should have been all along. If this horse’s ass is free to be fanatically against Apple then I’m unapologetically free to be fanatically for Apple.

    Eat my dust Swann…

    Go Apple!

  10. Funny, he failed to mention that he actually had hands on with the Apple TV in order to get his opinion. Mossberg based his opinion after using one for awhile.
    Who’s opinion would you trust??

    Oh! Let me guess. This guy is not high enough on the list to get one ahead of time like Mossberg did. I wonder why??

    Because this guy is actually paid to have the exact speculations that we here on this forum are able to have. If this guy is qualified to be an analyst, the we all are qualified to be analysts.
    Send me my check, please.

  11. More articles on the Apple TV please. I’m a bg Apple fan. I have a G4 PM, a Cube, a G5 PM and a MacBook. I got an iPod on day 1. I ‘get’ the iPhone. I probably won’t buy one as mobile device like that isn’t important to me (I have a basic phone, not a smartphone, and the gen 1 iPod is still fine for me).

    What I don’t ‘get’ is the Apple TV. It just looks like niche to me. My view tends towards agreeing with this analyst. So more articles, more comments, so that maybe I’ll ‘get’ the product.

    I have to remember that this is early days. I think it will be limited success for 2, 3 years.

    So I don’t really see anything wrong in what this guy says, but I’d like to. Part of me just says, “OK, so I don’t get it yet, but all will become clear in time”.

  12. I agree that Swann is no swami, and generally has been an idiot in the past, but in this case agree with him. Apple TV will certainly be useful for those who have a lot of iTunes video content on their computers and want to watch it on their TVs but I doubt if that is a large fraction of the TV viewing public. Maybe someday, but not now. I also doubt if most people will want to look at their computer-stored pictures on their TVs or listen to their music over their TV sound systems. I think Apple TV has the potential to take off but I suspect it will need to 1) be able to accept video input from conventional cable/satellite as well as computers, 2) record TV input in a Tivo-like fashion for transfer to computers or TVs, and 3) store larger amounts of video than can be accommodated on a 40 Gb hard drive, either by selling a version with a larger drive or be enabling external drives to be attached. It may also need to integrate with game players. I’m not sure it will have to play or record DVDs, because that can be done on the computer, though it would be more convenient to be able to insert the DVD in the Apple TV box next to the TV instead of in the computer in the next room. In other words, for this device to be really useful to me, and I suspect to most families, it will need to integrate and simplify all the current devices attached to TV’s as well as connect the computer to the TV. Maybe that’s their long range vision. Let’s hope so. Otherwise, I fear Apple TV will only be a niche device.

  13. Early days I’d say — ATV certainly doesn’t sing “buy me” to this tech-heavy household.

    But it’s unlikely to be a failure either, especially as Apple controls the entertainment download space.

    Come later versions with recording ability atc, and it’ll become ‘the one’.

  14. I actually agree with the set top fatigue point.

    I would gladly pay $1000 for an Apple TV that was also a cable box and DVR.

    Cable box is a possibility in the future with OCAP (Open Cable Application Program), but it will take a few years before OCAP is adopted on a widespread basis.

    DVR may be on the way, based on the rumors the past few days about Apple possibly buying Miglia.

    God knows my existing Scientific Atlanta cable box with DVR is a piece of crap with a horrible interface that could be improved upon. That and it puts out more heat than a toaster oven.

  15. This guy has some good points. I know its not zealotus enough of me to doubt Apple, but honestly I think AppleTV is going to be a bomb too. My reason for thinking this? Its one of the first Apple products in years that I don’t want. As an owner of 5 Macs and 3 iPods, this is not a good thing.

  16. I agree. I love my MacBook Pro, Airport Extreme, Airport Express and other things, but the iTV is a shoddy project with a limited feature set. In fact, one can argue that the Comcast On Demand pay-per-episode (sometimes free) model + DVR in their Motorola box is more robust. For music, I already have an Airport express.

    So why I ask would I need an iTV?

  17. Reminds me of the doom and gloom predictions for the original iPOD Mini.

    We all know how right those idiots were about that Apple product.

    Personally, I think the only thing standing in the way of the AppleTV being a huge hit, is the lack of a RENTAL OPTION for iTUNES movies.

    If Apple came up with a Netflix style rental plan concept for people to be able to download movies for a monthly fee but not be forced to purchase them, then I think this thing will be huge.

    Until that happens, I do somewhat agree with the pundits, that this device will have more limited success. I have no interest in switching from Netflix to this kind of product as long as I would have to purchase everything I wanted to watch.

    Just way too expensive and limited.

  18. I think Tv won’t be that big of a success. When the only media you can watch is the stuff in your iTunes library. The average already consumer already has sat/cable, tivo, dvd players. Why would they need the Tv unless their compulsively buying $10 and $15 movies and $2 tv shows on the iTunes store. And yes I know that you can play any movie on your computer not just what you get thru the iT store but do you think the average joe is willing to spend hours illegally converting his dvd colection to .mov files? The only way I could see a good reason for the Tv is if they allow you to rent movies for $3 and keep it for 5 days or something like what Netfilx is doing. People don’t watch the same movie over and over like they listen to music.

  19. I think I’ll believe Walt Mossberg of the Wall Street Journal before I’ll believe this guy. Walt says Apple TV is a great product and will only get better. Walt has been testing it for the last two weeks unlike this guy who hasn’t even looked at the product. This guy is running at the mouth on the internet with FUD! He has no clue what Apple TV does so how can he say anything about it.

  20. I think AppleTV has potential. Here is what I think might harm it though:
    1. Inability to be used with non-widescreen televisions. Let’s face it, the majority of Americans do NOT have the Widescreen TVs. This will severly limit the market (for now)
    2. Inability to “rent” content on iTunes. I know that this may change, but most people will happily pay $3 to rent a movie, but $15 just to watch it once on the sofa? I mean it’s a great premise for the children’s films (i.e. Disney where they keep watching the movies over and over again), but most people are not going to watch Elizabethtown frequently enough to buy it to own. I know that this may very well change, but it needs to soon.
    3. The quality of video. I will be the first to admit the current setting is FAR better than when iTunes first began selling video, but the quality needs to be raised even higher for the expensive Widescreen TVs to be able to make the content look good.
    4. Some sort of “feeder” device to force itself into the market. I think that had apple included a DVD Recorder with it or something that people knew they wanted it might sell better. Then in time, people would start using the other part of the technology, and eventually stop using the DVD Recorder. For some individuals who are not as tech-savvy having some sort of device that they know they will use reduces the “gamble” of buying this product.

    Now these are all problems I have with the timing for right now. I think that in 10 years Problem #4 will not be an issue at all, after all by then Video Streaming into the living room will be what all Americans will be doing.

    Problems with one-three can also easily go away as people no longer have analog sets, Film Studios loosen up and embrace this new technology (let’s face it, this is nothing new remember the VHS fumble.), and Apple will find ways to increase the quality.

    My only fear is that this product could be hurt by these problems, not saying it won’t be a good product, just saying it’s still kind of in a test-release form with all these other issues.

    MW: Apple needs to find a way to make sure AppleTV will land on it’s FEET.

  21. “4. Some sort of “feeder” device to force itself into the market. I think
    that had apple included a DVD Recorder with it or something that people knew
    they wanted it might sell better. Then in time, people would start using
    the other part of the technology, and eventually stop using the DVD
    Recorder. For some individuals who are not as tech-savvy having some sort
    of device that they know they will use reduces the “gamble” of buying this
    product.”

    It is not logical to include inferior technology with superior as bait to buy the superior tech.
    By your logic Apple should have included a Sony walkman CD player with the 1st iPod.
    LL&P

  22. The only thing in my opinion, that will restrict mass sales of Apple TV units in the UK and Europe is the fact that we dont have a itunes movie store yet.

    As soon as Apple makes that happen in Europe the Apple TV boxes will fly off the shelves and they will sell bucket loads.

  23. I expected most of the responses on this board to be negative to this article. So I decided to try to take an objective view. And I recognize that accuracy is often not the goal. Controversy sells and having a stong opinion sells more than having a fair and balanced opinion.

    But then I read the article and I just have to say that this guying is just begging to be slapped. I mean he’s just making things up.

    1. Limited Uses: Here he is making the traditional argument that the Apple TV does not have a laundry list of features. Can’t accept TV channels, no DVR, no DVD playback. I think he’s “not getting it” but I’ll accept that he’s staing the argument for the status quo.

    But then he goes on to support his argument by stating that Apple has not been successful in sell $1.99 TV episodes. Say what? Have they not sold millions of those episodes? You can’t support an argument just by saying reality doesn’t exist. Perhaps someone here can support of dispute that argument by providing accurate numbers on TV show sales.

    2. Set-Top Fatigue: Now he’s just making things up. He argues that Americans don’t want anymore boxes on their TVs. This may or may not be true. But he just pulls that out of the air without any supporting evidence. He’s not stating this new “set-top fatigue” syndrome as his opinion. He’s pretending that it’s holly writ. How about one shred of evidence to back that up.

    3. Compatibility & Confusion: “The devices concept is too confusing for most Americans”. Well, every review so far has talked about how easy Apple TV is to install and use. Perhaps the author of this article is projecting his own shortcomings on all Americans.

    4. Inconvenient: You have to download your ontent to your computer before you can send it to your TV. I think he has something here and I suspect that Apple will try to fix this in future iterations.

    I don’t mind him having a different opinion than mine. And I understand that he’s taking a strong stand because that is what sells. And ultimately, he may be right. But this is just trolling. I gain nothing from listenting to an opinion that’s unsported by facts or logic.

  24. @Anthony

    Excellent post.

    In regard to point number 2, I too fervently hope that Apple switchs to renting video content. But Apple does things the Apple way so far they been just a tad better at reading the market than I have.

  25. LOL, if selling 3 million units at $300 each is a failure, I’d love to have a $900 million business failure. Bring it on!

    Even if he’s right, 3 million units compares VERY favorably to sales of other products. Heck, Apple only sold 1.6 million Macs last year, of every type. Apple would be selling Apple TVs at the same rate or better as the best-selling game consoles. Three million in sales would be a perfect start on which to base a Version 2 product that is even more compelling.

    He’s pessimistic, and still he paints a rosy picture!

  26. To me the Apple TV product goes hand in hand with the MacMini.

    With those two put together as a setup then you have your DVR with OSX on the Mini, plus anyone of the plethora of add on devices to increase the capacity of the Mini so as your collection gets bigger you just add extra storage.

    As for the above article, its just another FUD as per usual.

  27. Not every Swann is a psychic. LOL Being that the AppleTV is really a specialized OSX-based computer, extensibility is “in the cards” so it’s all a matter of how Apple wants to enhance the functionality of the device.

    I’m sure, like the iPod, Apple has plenty of enhancements up it’s sleeve to release over time. I’m on a wait and see basis right now, happily content having my PMG5 connected to my tv using salling clicker as a remote.

    MDN Magic word: Ingo

  28. Dear MDN,

    Why do you glorify the idiotic ramblings of these morons by re-printing the garbage they are writing? Don’t you realize that any mention of their articles gives them legitimacy in the eyes of many readers? What they really deserve is to be utterly ignored.

  29. All you have to do is take a DVD and rip with Handbrake and impot (drag and drop) into the movies folder in iTunes and your ready for prime time on Apple TV. So either take your DVD collection or Video_TS folders and import them into iTunes. No DVD’s to handle and scratch. Just point your Apple remote and selct your program.

    I believe that most people will be happy with that option. Better options will obviously become avilable in the future and the product and application evolves. Plus consider the third party goodies that will become available just as the iPod. the possibilites are endless. And, stop with all of it can’t do this or that yet, most of us average TV Movie viewers just want easy access to our movies withour all of damage issues and skips that come with the physical DVD.

    It’s simplicity – it’s Apple. Apple TV bitch

  30. Isn´t watching TV dead???
    In our house we have gone from TV viewing basically all day long by someone in the house (pre-internet) to TV viewing maybe an hour or two per day. Everyone is involved with their internet-connected computers or TV-connected game console.
    If we want to watch a movie we go to the theater. If it wasn´t worth going to the theater to watch it on the big screen, it is worth watching it on the TV….or so my teenagers tell me.

  31. Anaysts do not make good snow shoes.
    ..once I was stuck in the snow. I needed snow shoes …..I tied on couple of analysts…one to each boot. After about 100 feet one of the analysts started to speak authoritatively about an iminent ice age. He just knew we were in for some global cooling and he was ready to write an opinion piece. The other one wanted to make a confession. “I’ve never been worth shit but now …now, I’m a snow shoe. I’m a snow shoe and I’m helping you get through the snow.” I told him to shut the fk up.
    .oh, yeah, …..I think Phillip Swann is going to bomb.

  32. Apple TV appears to be a really great idea. Will I buy one? No. My problem isn’t with Apple TV itself. My issues actually come up with the content.

    I have yet to download a movie from iTunes due to the price. I buy a few songs a week from iTunes because it is only a dollar a song and I have the option of not having to get the whole album to get what I want. I actually have an incentive to purchase the songs on iTunes.

    Movies on iTunes cost just as much as the physical DVD or can actually cost more. Why would I pay $10 (or more) on itunes for a download when I can get the same movie on DVD at Target for $10 or even less? Where is a compelling reason to buy the download instead of the DVD? On top of the cost I get better video quality, the extras, and the ability to rip the DVD to video format. It’s more bang for my buck. Why would I ever buy a movie from iTunes?

    Until they can bring the price down on movie downloads I see no compelling reason to switch from DVD player viewing to Apple TV streaming.

    I don’t think Jobs is the one with the price problem it’s the movie studios. Jobs knows that the thing that gets people to buy a computer is the killer application (iLife suite is one of them. The thing that will drive Apple TV is content but the price isn’t quite there yet.

  33. Here’s what’s great about AppleTV:

    I have a video I like: it’s hilarious/compelling/cute…

    where is it?

    in 3 different media most likely.

    Not that you can’t do this with Media Center, but who uses the library of media center as a central storage hub. Now, Apple is already suiting customers to be the media hub for their home (with usable software encompassing EVERY media desired by the consumer)

    They are the shoo-in.

  34. Who knows, Apple TV might fail. There’s a lot of confusion in the TV world right now for consumers: HD, full-res HD, Blue-Ray, HD-DVD. If you go to a store and ask technical questions of a sales clerk, it’s obvious that many (I actually think MOST) don’t have a proper grasp of even the most basic HD issues. Americans are technically retarded compared to our Europen neighbors. Apple TV requires not only competence in computers and TV technology, buying into it requires confidence that one has the qualities going into the endeavor. Apple TV might, indeed, fail.

  35. > Apple TV will fail to reach beyond the cultish Mac audience, probably topping off at about three million homes.

    What does “Mac” have to do with it? The product is for Mac and PC users. Apple TV makes any HD TV into a giant wireless video iPod. Perhaps he should amend that sentence to say,

    “Apple TV will fail to reach beyond the cultish iPod audience, probably topping off at about 90 million homes.”

    That’s at the end of 2006 for the 90 millions iPods sold to date. Now some of those iPods are owned by the same household, and many households do not have HD TVs (yet). But even if the current potential customer base was only 10 million, the trend is for more people to buy iPods and HD TVs. Once again Apple has positioned itself for the future instead of looking to the past. And the “analysts” can’t figure it out.

  36. If the Apple TV only plays Apple DRMed video from the iTunes store, then Steve can keep it. If it will accept any video from me computer, whether direct from a DVD or compressed, then I’ll really have to look in to it.

  37. “avi the de facto… HA HA HA!!! ASS!
    How so??”

    What a bunch of children we have here! AVI is a container format just like Quicktime. Many different video and audio codecs can be used to encode the content inside the container format.

    WMV is the defacto standard digital media format. WMV9 VC-1 (HD DVD format) is clearly superior to H.264 (MPEG-4 Part 10) for encoding HD video. The Society of Motion Picture and Television Engineers formally published the Final Specification for Microsoft’s VC-1 codec, leading to a codec that is well-documented, extremely stable, easily licensable, and accepted by the industry as a standard.

    As High Definition video becomes more popular the VC-1 codec will eventually displace WMV as the defacto standard format.

  38. I agree… what’s da point of Apple TV? It would be compelling to me if it had TIVO features & if you could add a larger USB2 or Firewire hard drive… but the device that’s offered currently just doesn’t appear to be worth the money to me.

    Hopefully the next generation will have Tivo features and allow external hard drives to be added.

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