“Thomas Weisel Partners comments on Apple after completing a round of 30 channel checks with Apple specialist resellers and Apple retail stores across the United States. Firm’s checks suggest seasonally soft quarter for Mac and iPod, which is not surprising given normal seasonal demand trends,” Notable Calls reports.
“TWP believes that, on a sequential basis, Mac units will likely decline in mid-single-digit area, but possibly be ahead of the Street assumptions on a revenue basis (they are at $5.39bn in total revenue versus Street at $5.17bn),” Notable Calls reports.
Notable Calls reports, “iPod nano still a dominant MP3 player, but checks suggest seasonal drop-off in demand compared with very strong December quarter: Again, not surprising and consistent with expectations of a 48% q/q decline in units. 4GB iPod nano remains the best-selling iPod, and Apple continues to outsell competition by 8:1 ratio.”
“Checks indicate limited interest in iTV [Apple TV]thus far. Firm does not view this product as a large opportunity, as they believe there are less than 6mn PVR-type devices sold in the marketplace annually at present,” Notable Calls reports.
Notable Calls reports, “Firm believes the growth opportunities continue to be strong for Apple, but that those opportunities appear to be well understood by the investment community and, thus, reflected in the current stock price. Maintains Mkt Weight rating.”
More details in the full article here.
Related articles:
Analyst: Mac sales growth continues to exceed rate of PC sales growth – March 30, 2007
NPD data shows Mac sales growing 5x market growth rate in February – March 29, 2007
PiperJaffray checks show Apple Mac sales likely to beat estimates this quarter – March 20, 2007
NPD: Mac sales grew 108% in January – March 01, 2007
Prudential ups Apple Inc. estimates on strong Mac sales, margins – February 21, 2007
RUMOR: Apple TV sales blowing away Apple’s internal expectations – January 25, 2007
These guys keep trying to find ways of being relevant. Chances are that they will be proven irrelevant again this quarter.
Seems like a very reasonable assessment. However, not quoted by MDN but in the article is this bit…
“I continue to be cautious on AAPL and still think it’s a short around current levels.”
It’s risky business to short AAPL. You never know what Jobs will pull out of his hat next.
Apple TV is over priced and the hard drive capacity is too low. They should have made it a 250GB hdd, full 3.5″ size to keep cost down and made it replaceable by the customer as well as turned on that USB port for external HDD storage capacity.
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STOP WHINING!
TV is not a pvr, therefore does not need to have a large hd. It’s for streaming video. You can place your photos on it however.
It will be interesting to see what the release of Adobe products does for Mac sales between now and the 15th.
Of course sales this quarter are softer than the last quarter. Christmas shopping happened last quarter, not this.
The author is a hit generating jerk. AAPL moves in direct relationship to management’s guidance. Management guided lower at the January conference call. The time to short AAPL was the morning after the conference call, not now.
My personal estimate for March quarter earnings is 74¢, with management guidance for the June quarter 70¢. That guidance represents a 25% increase over guidance given last January. A 25% increase in guidance is going to cause AAPL to boounce significantly the day after the April conference call.
Beware the analyst that posts contrarian “research notes”. They are trying to manipulate the stock lower so clients can jump in at a lower price.
I love my iPod, but I love my Creative a whole lot more. Sorry.
…Although I am definitely look forward to Apple TV. Either that or I just keep using Tivo or something. I have all my favorite shows and movies already stored and connected to my TV readily available for access though.
Check out this great BWeek article!
http://www.businessweek.com/technology/content/apr2007/tc20070404_499334.htm?chan=top+news_top+news+index_technology
MDN should post it.
Tonight my wife and I caught up on BSG, Boston Legal and CSI. We sat in our kitchen and watched it on my Mac’s 17″ screen. While we did that I seriously contemplated if $299 was worth the ability to watch it on the comfy chairs in the living room with superior sound in comparison to the computer speakers (JBL Creature). Right now it’s not. There’s no iTunes content available outside the USA and my EyeTV only records in 640×480 which looks like crap on the big 27″ TV. So, I’m going to have to wait to see if more features are enabled with the release of Leopard to make it worth the price.
There is a point where a device becomes too minimalistic and therefore doesn’t have enough to convince the customer to purchase. Judging by the sales numbers, I suspect most prospective buyers feel the way I do.
Quite frankly i dont see a lot of consumers buying the TV because it doesnt play TV…. which despite Apples marketing etc won’t be known to them till they walk into the store and ask… they will then be disappointed and not buy it.
I realise it wouldve cost more for them to do, but would it have really been that hard to put a decent hard drive in and a HD tuner?
MCE is too complicated for the masses, if apple did it in true apple style they would have had a much bigger seller in my opinion.
The big news on Apple TV is not what what it is today. Currently it is a good product for the small target audience. What’s great about Apple TV is what it will be in the future.
The OS and UI are built, all Apple needs to do now is figure out what the everyone else wants Apple TV to be (for me, it’s the ability to record TV shows) and build it without alienating the movie studios Apple is currently trying to court.
Steve seems like he takes his time when we are impatiently waiting for something, but it will come eventually.
What were we talking about again?
MW – change
Apple may be slightly ahead of the curve with the Apple TV, but the whole market has to go this way. Broadcast television is already dead; they just haven’t buried it yet. When the content starts catching up, and customers start catching on, Apple will be right there in the middle of the great unfolding.
Tidbit just in
iTMS will have HD content shortly after Lepoard rolls around for Intel based Mac’s ONLY!
Disney content first of course.`
I think some of the reason for low sales is that a lot of people, me included, are waiting for Leopard to come out before purchases. Surely sales after Leopard will see a jump that will be higher than the similar quarter last year. If Apple gave the rebate for student purchases this upcoming fall and had a new widescreen ipod I would be sorely tempted to buy one. There reason sales are low I think, well part of the reason, is that people are delaying purchases for big news.
The TV, like the mini and iMac, are the products of, in my opinion, an exaggerated minimalist approach to design on the part of Apple.
They could offer more for less if they increased the size of these products.
By forcing themselves to use components designed for notebooks, they’re throwing away the advantages of desktops, i.e cheaper but more efficient components, together with more flexibility.
The Mac Pro is the exception of course, but it’s for the upper end of the market.
Apple should bring out a ‘standard’ computer, which could also, of course, be beautifully designed, and the size and price could lie comfortably between the mini and the Mac Pro.
Apple TV low sales – I even can not buy the thing in Poland. I have been banging their heads from March already and Apple retail store personnel act like complete morons without slightest idea about the item, although Polish Apple site says come and get it. It has been lasting like that for last month. Finally I have decided to fetch one out of Germany but because of Easter they also have days-off problem.
@ The Other Steve: “The big news on Apple TV is not what what it is today. Currently it is a good product for the small target audience. What’s great about Apple TV is what it will be in the future.
The OS and UI are built, all Apple needs to do now is figure out what the everyone else wants Apple TV to be (for me, it’s the ability to record TV shows) and build it without alienating the movie studios Apple is currently trying to court.”
The future is now, my friend. I agree with your take on what AppleTV should do, but disagree about why Apple didn’t just build it that way right off the bat, and whether it actually is a good product, or whether a “small target audience” for a device like this is worth going after.
Apple isn’t trying to figure out what people want – if they were still in that mode of thinking, the AppleTV wouldn’t have been offered at all yet. No, they’ve made a corporate decision to tie their video efforts exclusively to iTunes content, ignoring the whole world of content and capability that they could have allowed us to access with their device. As it stands, the AppleTV appeals to a market that consists essentially of Apple enthusiasts and tech geeks. And why Apple made it that way? I believe the desicion-makers iin Cupertino may have started taking their own press too seriously, and thought the majority of people were actually in those two catagories (especially the former).
As for alienating hollywood, let me tell you – that horse is out of the barn. It isnt b/c of anything Apple did to them – in fact, Apple has bent over backwards trying to court those f*ckwads. It’s all for naught, however, because what they hate about Apple is their success. Specifically, they’ve seen how record companies – without exception – eventually come around in some form to Apple’s desires on how to do things. As much as ‘corporations’ are all about making money, the people who run them do not percieve themselves as mere cogs in the machine. They are ego driven people. And none of the CEOs of the studios want to be Apple’s next bitches.
Jobs is still proceding from the delusion that he can do anything about that. He was a studio head not too long ago, so he probably has some sympathy. But in the end, technology is driving this argument between them – technology that allows HDTV & recording of content – and the studios are on the losing end of it. Jobs is hurting his TECHNOLOGY based company by not allowing it to build & sell a device that gives consumers what they’ve already demonstrated that they want (DVRs), which is to say what technology already provides. iPod did that – it gave the market what it already demonstrated it wanted (a DAR); it just gave them a better one. The runaway success that is iPod demonstrates the wisdom of the approach.
AppleTV is no iPod; it’s a kludge. Apple has ignored what technology and the market wants in favor of a ‘box & sales system’, designed to get the studios to ‘trust’ Apple enough to offer more content, in HD, on iTunes. Yet except for Disney, none of them will ever trust Apple. Ever. EMI just ‘caved’ on the one thing Hollywood believes in more than God (DRM), and you think they’re going to trust Jobs? Eventually they’ll offer more content (you can only bang your head against the wall for so long), but that could be years. Meanwhile, every other company out there is going to try to b/c THE brand for home entertainment – a huge market – and they won’t waste time trying to court an industry that doesn’t want to play with them. Apple, the one company in the best position to pull that off, is instead, stupidly, giving all their competitors a chance to do the same before them, simply by not bringing the hammer down ASAP.
“Steve seems like he takes his time when we are impatiently waiting for something, but it will come eventually. What were we talking about again? MW – change”
Good one. Aren’t these MagicWords freaky? Speaking of change, that reminds me of a famous quote:
“You must be the change you wish to see in the world.” -Mahatma Gandhi
As that applies here, there’s no time like the present for Apple to make AppleTV more than the expensive toy it is. They want to create change? All the technology and expertise they need is in place as we speak – has been for a couple of years in fact. So Apple needs to stop putzing around with esoteric ideas and misguided attempts to placate an industry that will never love them (talk about Stockholm Syndrome … sheesh!) and just get after it. Now.
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Oh, and my own MagicWord is – no lie – “results”
In a slightly more restrained way I’m with Odyssey67 on this one. I’m accustomed to watching free television. In years gone by I recorded tv programs onto a vcr. Lately, (shock/horror) I’ve gotten sick and tired with Australian television stations jerking my wife and me around with delayed broadcasting of these programs. Sometimes we’ve had to wait years for programs; or the delaying of the broadcast for a sporting program or a non-rating period (because we have only five stations and two are broke or next to broke). Finally I’d had enough and I started downloading Xvid encoded tv shows. Breaching copyright? You bet! feeling guilty, no way!
Now if Apple had’ve made it easy to stream these programs (and I totally understand the legal issues involved) then I would’ve jumped at buying an AppleTV. What the product does for me now is, frankly nothing. There’s no incentive in it for me. Can it easily stream Xvids? No! Do I intend buying low quality programs when they eventually go on sale in this country at “The Store”. No bloody way.
So I’ll just keep doing what I’ve been doing for the last year or so and I’ll eventually stop using the primary Panasonic vcr (probably in a few months) for the odd show we tape off cable or free to air and replace it with a digital dvd recorder. I’ll then probably use the the dvd recorder a lot more than the vcr (dead end technology).
I guess I’ll be using Toast a little while longer to re-encode the Xvid tv programs over to dvd VOBs.
The funny thing is that dvd players/recorded are region locked but in this country our courts see this as restriction on free trade so in effect we have no region locking. However the way the companies are releasing their programing they are actually “locking” the release dates to geographical regions. And that’s why millions of people download “illegal” tv shows. Are we criminals? I don’t care. I just want to see ep’s 16 and 17 of Jericho. And that’s where Xvid comes in.
Apple TV is a not just a product but a gambit to establish rational standards in a market riven by utter chaos. So the complaints that Apple TV doesn’t do this or that miss the point. The issues of DRM vs. no DRM, open vs. proprietary codecs, aspect ratios, bit rates and picture formats create a technological analog of the Augean Stables. If Apple were to support all existing varieties of this stinking mess, it would fail in this business along with all of the others. Apple has started small and is trying to affect standards to create a rational and outstanding architecture into which it can sell its products.
So for now we are stuck with a product that has outstanding performance with a simple user interaction model, but for a very limited set of capabilities. If Apple can make some headway in cleaning up the sh*t in the stables, by getting the best approaches accepted as standards, then it will be in a position to win big. But this is going to be a long struggle.
Anything compared to the Christmas quarter is going to look weak. iPods are the perfect gift, but right now everybody is planning their summer vacation.
Boy, folks are long-winded today.
Odyssey67 you are wrong. By your logic, Apple should have offered to record radio only for the iPod and we would all have been set. How dumb a proposition is that? To make this as easy as possible:
Cable/Satellite TV = Terrestrial Radio
CD = DVD
iPod = Apple TV
Apple is not trying to piggyback on the existing 40-50 year old TV distribution network and revenue model. That’s what Tivo and MCE did, and at least Tivo is a step in the right direction, but no one should fool themselves into thinking you are recording “free” shows, someone in your house is paying > $50 (in the US, I don’t know what the models look like outside the US), and sometimes a tremendous amount more.
Apple is trying to create an entirely new video content distribution system. The primary source of content is iTunes for now, but Apple TV has already defined a standard video format for people on the net to hit. Now anyone with an RSS feed that gets you to subscribe to it in iTunes has the distribution power that was locked up in broadcast TV channels. And the TV “success” model, Nielsen ratings, is horribly broken. Listen to Ron Moore’s latest Battlestar Galactica podcast “Frak Party”. He says up to 1/3 of their entire audience was from Tivo users (including me) and they can’t count that number in ratings cause advertisers won’t pay for Tivo users! With Apple TV, shows get paid direct and know exactly how many copies were sold, and if your buying, someone is watching.
it took Apple 3 years before the iPod hit critical mass because some couldn’t wrap their mind around it, I think Apple TV will be no different, sadly.
I would have got one if it worked on a 4×3 tv with comp. or s video
I will get one when I upgrade my tv ( 2 years from now >? )
It does work with an SDTV that has component, I had the Apple TV connected to one before I upgraded to an HDTV this past weekend. The only caveat is that Apple TV is formatting the video it plays to look good on a 16:9 display, so 4:3 content is a bit squished. You just have to have an SDTV that has a 16:9 setting to commensate for that. That’s why Apple says widescreen only, SDTVs with component inputs are a mixed bag in capability.
TV is really an advanced beta product. A good start, but The Real McCoy should come along later, when more of Apple’s building blocks are in place; full HD content, more and faster bandwidth, etc..
Downloading full HD with the current internet speeds will be slow and painful. If you use cable, when everyone else in your neighborhood decides to download HD, it will be like AOL dialup… misery by another name.
TV’s hard drive is too small. Period. It need 2 options: a bigger drive and the ability to attach an external hard drive.
Quibble if you like, but while we have consumer cameras pushing 10 megapixels, a 40GB hard drive will fill up FAST. I have a 7 MP camera and each shot averages around 3.5 megabytes each. They fill up space fast.
Of course it’s a soft quarter. No one wants to buy an older model Mac or iPod with the new model announcements eminent.
It’a always interesting to see the “anti-Apple” brigade fall over each other on their way to the bandwagon every time some “analyst” makes even a slightly discouraging remark about Apple. Apple TV is not going to do everything that everybody wants. Apple are accused of making a “corporate decision” about content availability for Apple TV. Well, duh! The last time I looked, Apple Inc. was a corporation – a very successful one with their decisions for the last few years. If Steve Jobs is “delusional”, his delusions have been a resounding success so far.
For me, the big hindrance to buying the device is simply that I don’t have a widescreen HD TV yet – cannot afford one – and I’m not going to run out and run up my credit card just to justify a $299 purchase. If Apple TV were usable with older TVs, I’d pick it up in a heartbeat – I have tonnes of video and audio material gathered from various “sources” on my computer, and I’d love to watch it/listen to it on my TV. I have no problem converting stuff to formats that Apple TV accepts – video conversion is a snap these days.
I wish Apple TV were usable with my trusty old “fat boy” TV – but just because it is not, I’m not about sit here and throw mud at people who are able to rake in the billions every quarter with their decisions.
What’s great about Apple TV is what it will be in the future.
Surely you mean what’s great about it is its potential, which, by definition, means the product has not yet attained that potential greatness. Whatever.
The iPod fulfilled a need to make consumers’ digital music [and later video] files portable. The catch is that iTunes is necessary. The trap is that if you allow iTunes to “manage” your digital files, you’ve become dependent on iTunes and half-locked-in to the iPod family. That’s fine for now, but imagine, if you will, that the choice of file management were withdrawn….
The TV fulfills a need to make consumers’ digital files play in their TV. The catch is that it seems dependent on iTunes [I really don’t know], which is fine if you consume iTS and let iPhoto manage your images. But with a need for backup and playability in 5 (soon to be 6) TVs served by wireless and 4 wired dvd/divx players, and with a mac fast enough to make reencoding painless, plus a third-party [more robust] burner, I just don’t see how the TV can be of service.
Now if the puppy had big storage and delivered content by wireless, all we’d need is 1-2 TVs and 5-6 wireless receivers. The catch is, they would also have to play any region dvds and divx/xvid as well as work with the wireless senders attached to my two cable boxes. The benefit is that we can dispense with most encoding and burning efforts plus the wired players and disks (the costs would probably be a wash).
From my perspective, the product is miles away from having the potential to meet my needs.
Now, as for iTunes being the video player, I don’t even use the QuickTime or Apple dvd player for various reasons including codecs and region limitations.
LinuxGuy and Mac Prodigal Son
If Apple were to support all existing varieties of this stinking mess, it would fail in this business along with all of the others. Apple has started small and is trying to affect standards to create a rational and outstanding architecture into which it can sell its products.
You are not wrong. Consumer companies in AV are the same as the squabbling brats in the cellphone industry. They have no intention of making it easy for the customer, and only wish to impose their vision of the world on the buyers of their products with little concern about working with the rest of the industry.
Apple saved us from WMA, and it is now a very real possibility that Apple can save us from the Kludge Wars looming in home entertainment.
As for all this early adopter “high definition” blather: you guys can put a sock in it. The majority of households don’t know and don’t care about high end supposed standards for which no content exists.
Over analizing everything as usual and trying to play down Apple’s sales as usual. I think they will be proven wrong again when Apple shares there results. Most of these companies predict seasonaly better than forcasted sales on Macs and iPods.
I was at the Apple Store this past weekend and saw an Apple TV hooked up. Nice display and everything – it was hooked up to a Sony TV, really easy to use…but man picture quality looked like ass-just horrible. My girlfriend agreed and she’s really not into it as much, but she pretty much said it – yeah, that looks really awful.
@ Dave Murdock: “Odyssey67 you are wrong. By your logic, Apple should have offered to record radio only for the iPod and we would all have been set. How dumb a proposition is that? To make this as easy as possible:
Cable/Satellite TV = Terrestrial Radio
CD = DVD
iPod = Apple TV”
Gee, thanks for talking slow – I was losing track there for a minute!
” width=”19″ height=”19″ alt=”smile” style=”border:0;” /> Look, your description with the “=” marks is not accurately depicting the situation. You are basically saying little shiny discs equal each other, or invisible electromagnetic spectrum delivery mechanisms equal each other … NO! Let me try to make this easy:
All MP3 players that had any degree of success let you put the most easily recorded format of audio that was available on them. The CD is/was that easily recordable audio format. Cable/Satellite/Broadcast TV are the most easily recordable format of video available. The fact that the former is a physical disc and the latter an electromagnetic wave is irrelevant. It’s the underlying principal – allowing people to record available content they already have the best access to – that is important. Hence, any video device claiming to make accessing your life’s video content easy has to accomodate broadcast TV, in the same way that audio devices (like iPod) had to accomodate CDs.
Being misled by the physical similarity between CDs & DVDs is understandable. Yet even here, the problems DVDs present (thanks to CSS) are not insurmountable, and – despite Jobs claims – aren’t even legal in nature. Recent court rulings show that copying a DVD to a home hard drive/server is legal. See here:
http://www.dmwmedia.com/news/2007/03/30/kaleidescape-wins-case-over-dvd-ripping-home-server
If you read the article, it’s pretty obvious that all Apple would have to do is integrate Fairplay on the ripped DVD after it’s been stored on your computer or AppleTV or XServe or whatever. Simple. Or … they could have just put a DVD player on the damn thing.
“Apple is not trying to piggyback on the existing 40-50 year old TV distribution network and revenue model. That’s what Tivo and MCE did, and at least Tivo is a step in the right direction, but no one should fool themselves into thinking you are recording “free” shows, someone in your house is paying > $50 (in the US, I don’t know what the models look like outside the US), and sometimes a tremendous amount more.”
Yeah, why should Apple try to piggyback on a longlived and successful distribution network. That would be INSANE … Of course, that’s exactly what they did with the iPod … and made a helluvalot of revenue off that … but … anyway …
As for TiVo, you said it yourself – its “a step in the right direction”. Yet that obviously implies a further step. Apple could have taken that step by simply selling the DVR box – the AppleTV – without the monthly fee, and letting people buy TV shows & movies, in HD, from iTunes, directly from AppleTV, if they wanted to. And by letting the device access video on the internet (YouTube & GoogleVideo, at least). And by letting people store their own DVDs on, or >gasp< even PLAY them through to, AppleTV. And, finally, by having Apple TV support all the codecs that QuickTime does, thereby making the streaming feature totally rock.
What you have then is truly a convergance device, doing what Apple wants & is trying to encourage (streaming and promoting iTS content) as well as what people want and do already with their freely available or pre-existing content. It’s not only better than TiVo (the next step), but it’s cheaper than TiVo to boot. Hell, if they focused iTS on TV content, Apple could also provide a cheaper alternative to paid cable & satellite.
cont …
@ Dave: “Apple is trying to create an entirely new video content distribution system. The primary source of content is iTunes for now, but Apple TV has already defined a standard video format for people on the net to hit. Now anyone with an RSS feed that gets you to subscribe to it in iTunes has the distribution power that was locked up in broadcast TV channels. And the TV “success” model, Nielsen ratings, is horribly broken. Listen to Ron Moore’s latest Battlestar Galactica podcast “Frak Party”. He says up to 1/3 of their entire audience was from Tivo users (including me) and they can’t count that number in ratings cause advertisers won’t pay for Tivo users! With Apple TV, shows get paid direct and know exactly how many copies were sold, and if your buying, someone is watching.”
These are your best points. Lets address a couple; like that TiVo allows advertizers to skip out on paying full rate for ads on popular cableTV shows. Cry me a river. Cable TV was never supposed to be ad supported – that’s why we PAY for it. The Reagan administration allowed that to happen, and it – along with their essentially unregulated monopoly power – has resulted in a bonanza for cable TV ever since. BSG is a phenominal show, but it’s surrounded by a sea of drek that only exists b/c the cable TV system has more money than it knows what to do with (more dollars than sense, as grandma used to say). TiVo is simply bringing a little sanity back to things.
Another thing that happened under Reagan was that the time limits for commerical breaks was eliminated, for both ad suppported TV and cable. You might notice that an old TV show from the 70s is often cut off at wierd places when re-run today – that’s b/c the commerical breaks are so much longer today & the shows actually have to be edited to fit the breaks. But cable’s activities have been particularly egregious. You see way more commericals on cable – which, I remind you, you are already paying for – than on purely ad supported TV! Explain that one to me without the word “greed” in it, and I might have more sympathy for any cable TV show producer’s ad revenue lament. Here’s a report on the phenomena:
http://www.austin360.com/tv/content/movies/television/2005/10/11tvcolumn.html
Still, if you’re going to insist on Tivo being the bad guy here, realize that the only reason the advertizers can get such info is b/c TiVo leverages it’s subscription service to keep track of what you are doing. An AppleTV/DVR should not have subscription fees – there’s no need for it. And without that, what you watch & how you watch it becomes tougher to quantify. Sure, Apple could use other technology to do the same thing, but I’d like to believe that Jobs’ public stance on DRM would extend to such things (and know for a fact that the hackers would come up with a solution if it didn’t). Basically we’d all be better off going back to using the Nielson method exclusively, which simply measures popularity, and the advertizers should just concentrate on making fewer, better commericals that people don’t actually mind watching.
But you and I are not too far apart on the potential power of iTS as a distribution model. However, it should not replace free (ad supported) TV – it should suppliment it. It should become what cable was always supposed to be – a paid service for content that (b/c you’re paying for it) can be as cutting edge or non-mainstream as can be supported by its customer-base. iTS’s best destiny is to replace monthly subscriptions for paid (cable or satellite) TV.
“it took Apple 3 years before the iPod hit critical mass because some couldn’t wrap their mind around it, I think Apple TV will be no different, sadly.”
It took iPod 3 years because that’s how long it took to create the iTMS, a Windows version of iTunes, and to lower the price and expand the product line of the devices themselves. People were remarkable quick to wrap their minds around it, as it wasn’t that tough to understand in the first place – iPod did what they wanted to do with their music all along.
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@ Odyssey67: I guess we are just going to have to disgree with how the world of TV maps to the world of music and how the iPod/Apple TV were/are designed to take them apart.
But give me a freaking break, I am crying no river for cable/satellite TV, you missed my point entirely. I want Apple TV to destroy it because I can’t stand paying a large monthly fee and having ads shoved down my throat with nothing to show for my money no matter how little I use the service. That’s one of the things I love about Tivo when I got it, oh 5 years ago now, it resets the playing field to me almost watching only the shows and not the ads for my monthly fee. But it’s only a band-aid to having on-demand anything with no ads and not fast forwarding when I pay for the show. I don’t think ad supported goes away, there will clearly be people that watch video with ads they wouldn’t pay for, but Apple TV can offer another way to achieve finally distribution of video content to homes as soon as a show is ready (i.e. not waiting for DVD archives) completely without ads. My point about BSG was that renew/cancel decisions are being made at studios bases on the Nielsen numbers since their business model of double-dipping and still charging me a lot per show is starting to implode.
I saw the article weeks ago about home DVD ripping, it happened on 3/30, you are being crazy to suggest Apple should already have DVD ripping to fairplayed m4v files in iTunes. This is one precedent, and ties into my point on the iPod taking 3 years to take off. You can’t decry the lack of HD content in iTunes and not be able to figure out the studios (TV, Movie, is there that much difference anymore?) are holding out on Apple with complete content, control the strings on DVD ripping being tied to video content supply, and are also most likely holding out on Apple with HD content. I have little doubt that the large window form iTV announcement in 9/06 to availability in 3/07 was an attempt to have enough time to secure some HD content, but they couldn’t get it done. Apple TV is just running OS X, anyone seriously think Back Row took them the better part of that time to get right? I didn’t think I saw many hands. Apple TV only takes off with the masses if 100% of TV Shows are on it day and date+1 with broadcast and their in HD.
Its nice you think Apple has to attach to broadcast TV, I mean when they avoided the 70 year old ad supported broadcast radio system with the iPod, that was working great too. My point is not what comes over the electromagnetic spectrum (hey, I know science too) its about ad-supported/broadcast content vs. dedicated media delivery. And CD vs. DVD is slightly different only because video, going back to VHS, has had DRM (macrovision on VHS, CSS on DVD), while CD did not, so there was more freedom to innovate without legal entanglements. If DVD didn’t have DRM, a large part of this entire thread woudl evaporate because iTunes and Apple TV would obviously replace your DVD player.
Anyway, I have been and will keep talking about these issues on my blog as things change this year.
http://www.innerexception.com
@ Dave: “… give me a freaking break, I am crying no river for cable/satellite TV, you missed my point entirely…”
No, I didn’t. Like I said, you & I aren’t too far apart on the points, especially the ones you make in that paragraph. The “cry me a river” line wasn’t directed at you, it was directed at cable TV producers who don’t want to acknowlege that they’re making money ‘coming & going’ in their industry, regardless of how good/bad their shows are. It’s a shame a good show like BSG has to deal with the ‘hassle’ TiVo introduces, but the entire revenue model is a corruption so I don’t have any sympathy.
“you are being crazy to suggest Apple should already have DVD ripping to fairplayed m4v files in iTunes. This is one precedent, and ties into my point on the iPod taking 3 years to take off.”
I’m only suggesting it as an example of their being more than one way to skin that particular cat. DVD content isn’t going anywhere for at least a decade – the inertia of its huge installed base will see to that – so if Apple is going to sell AppleTV as a home video solution, it’s going to have to deal w/that. Personally, I think an upscaling DVD player in the box is the best solution. At WalMart they’re $79 right now (which is approx 3Xs the cost of manufacturing the hardware), so there’s no reason Apple can’t include it. As with a DVR, the increased purchase cost would be more than offset by the increased functionality
“You can’t decry the lack of HD content in iTunes and not … figure out the studios … are holding out on … content, … also … with HD content. I have little doubt that the large window form iTV announcement in 9/06 to availability in 3/07 was an attempt … to secure some HD content, but they couldn’t get it done … Apple TV only takes off with the masses if 100% of TV Shows are on it day and date+1 with broadcast and their in HD.”
You obviously haven’t seen any of my other posts on MDN, as I’ve been pounding that drum (how the studios won’t ‘play’ with Jobs) for quite a while. Your description about the time between announcement & availability is undoubtedly correct IMO. However, part of my ongoing argument regarding why Apple should put DVR capability in AppleTV is precisely because the studios are stonewalling him. Lets face it; they wouldn’t be doing so if they didn’t believe Jobs’ only recourse was to get content directly from them. And apparently he’s done little to dissuade them from this idea. Any good negotiator recognizes that when his opponent has him in a corner, it’s time to either pay up (stop wasting time on negotiations, as time is money) or change tactics. If Jobs was willing to pay, he would have done so by now. What I don’t think he’s come to grips with yet is how to change tactics. And what I reccommend is using DVR as a way of saying to these content providers ‘Fine, if you won’t give me vids to sell for you, I’ll let my customers get content any way they can, for free if necessary.’ Under that scenario, the studios are clearly on the defensive. Apple has already demonstrated with iPod/iTS that it can comfortably make revenue off the device almost exclusively. iPod content was never tied to iTS, and iTS revenue is more or less ‘breakeven’ for music, yet sales of the device are making Apple a mint. That’s what’s given Jobs so much leverage with the record companies – when it comes right down to it, he can take ’em or leave ’em.
Right now it seems Apple is being much more focused on tying AppleTV content to iTS sales (so much so that QT files that aren’t iTS ‘standard’ don’t always play, despite QT being the underlying media engine). I think this is a mistake. Given Apple’s inability to get content (SD, HD, whatever) on reasonable terms, it’s pretty obvious to me that the studios need to see that if they aren’t interested in making money w/Apple, Apple will make it without them.
Money is the prime mover here – just look at TV shows on iTS; they’ve been more available, and the reason is it’s just too hard for anyone in the industry to turn their noses up at the logic behind making even more money off a show that’s already recouped their investment (ads & cable revenue strike again). But making money is only one side of the coin – being denied the opportunity is just as ‘prime’ a mover, and an AppleTV with the abilitly to ‘TiVo’, and play (and/or store on a HDD) a customer’s already available disc content, basically gives the AppleTV/iTS system the same advantages as the iPod/iTS system always enjoyed – which is to say, the ablility to say ‘no’ to the demands of those who might try use their content as a means to extort (both Apple, and the consumer).
cont …
“Its nice you think Apple has to attach to broadcast TV, I mean when they avoided the 70 year old ad supported broadcast radio system with the iPod, that was working great too. My point is not what comes over the electromagnetic spectrum (hey, I know science too) its about ad-supported/broadcast content vs. dedicated media delivery.”
You’re making a distinction without a difference in this case. Yes, Apple could have made terrestrial (electromagnetic) radio a point of their efforts I suppose, but it wasn’t necessary – CDs were the more efficient delivery mechanism for music. Later, broadcasts actually went ‘podcast’ (MP3) to get in on the action that iPod created, making any further consideration of accessing radio in some way (on Apple’s part) largely pointless. TV is different – again, the most efficient and widespread delivery mechanism here is not DVDs, but broadcasts. Ad supported or dedicated media delivery, doesn’t matter – it’s all about what is the easiest & most widespread method people have of getting content. For music it was CDs, for video it’s broadcast. Apple would have been stupid to not allow iPod to access CDs then, and are being stupid in not allowing AppleTV to access broadcasts now. It’s certainly what the average consumer wants, and – I believe – would do wonders for Apple’s negotiating position with the studios insofar as getting more content for iTS.
“And CD vs. DVD is slightly different only because video, going back to VHS, has had DRM … while CD did not, so there was more freedom to innovate without legal entanglements. If DVD didn’t have DRM, a large part of this entire thread woudl evaporate because iTunes and Apple TV would obviously replace your DVD player.”
Another reason why I don’t equate the two. The legal issues surrounding DVD’s DRM obviously make that format much different from CDs. I don’t think you realize how much you just proved my above point, but no matter. DRM has killed many enabling technologies up to now, but the winds (in music with the EMI announcement, and the court case I mentioned above with DVD) are starting to blow in a different direction. We’ll see how that goes, but if I was Apple I would be doing expending just as much effort to get behind changes in DRM for video as for audio, if in different ways.
I happen to agree with Jobs that movies are different beasts from music. After all, a pirated song doesn’t preclude a musician from making a living as a live performer (probably enhances the career, truth be told), yet there’s never going to be a travelling troope performing StarWars or The Incredibles. Some protection for recompense is necessary. But that doesn’t mean the MPAA’s draconian methods are on the right path. Some readjustement, favoring consumers, is in order. That’s why I’m encouraged by the above court ruling – even if Apple doen’t use the method they ruled in favor of, it allows the same degree of protection as currently exists and still doesn’t stifle what the technology allows to be done. And that can only be a good thing long-term.
Anyway, good debate. Take care!
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