“It’s no secret that Apple TV — the company’s would-be digital hub for your living room — isn’t selling like hotcakes. Late Friday, Macworld published new Apple TV sales estimates from Forrester Research: the firm guesses Apple has sold 400,000 of the gadgets since it went on sale this spring and may sell another 400,000 during the holiday shopping season. But Apple will likely miss Forrester’s projection of selling 1 million Apple TVs this year,” Dan Frommer writes for Silicon Valley Insider.
“iFlop? Maybe. But it’s not too late for Steve Jobs to fix things. Despite plenty of claims to the contrary, the device still doesn’t have much serious competition,” Frommer writes. “How can the company make Apple TV a winner?”
“Step 1: Upgrade the software on current Apple TVs. The device has impressive hardware specs: it can play HD video, connect to the Internet, and has a USB port. But in the present tense, most of these features are useless: the video content on iTunes looks bad on a HDTV, and the USB port doesn’t do anything,” Frommer writes. “Step 2: For Version 2.0, re-think the Apple TV as a better DVR/set-top box.”
Full article here.
First order of business: Has any other company sold 800,000 units of such a device in the first year? If we had to guess, we’d say “no.” Not even close.
That said, Apple TV can certainly be improved. Frommer’s article is an “everything and the kitchen sink” piece with some pie-in-the-sky stuff that the content providers likely won’t allow – ripping DVDs via iTunes, for example – to downright misconceptions about what Apple TV is meant to be – put a big hard drive in there and turn it into a DVR. Still, since the article offers something for everyone, it contains a few interesting ideas.
One thing that makes a lot of sense that Frommer doesn’t really cover is the idea of using the rental/subscription model for movies and TV shows via iTunes. That model works best with how people interact with such media. We listen to certain songs over and over again; not so with TV shows or movies – such repeat viewings are very rare. We want to buy and own or music and rent our TV shows/movies because we consume each type of media differently.
As we repeatedly say: Business models that fly in the face of human nature are doomed to failure. Apple TV and the iTunes Store – at least when it comes to TV shows and movies – currently fly in the face of human nature. We watch TV shows and movies once; it make more sense for most people to pay a monthly fee and watch what they want. No matter how cheap storage becomes, we don’t want to store episodes of “The Amazing Race” forever. It’s disposable, one-time-only viewing.
Let us subscribe/rent with the option to buy the comparatively few titles we actually want to own via iTunes Store directly from Apple TV, add Safari with wireless keyboard support via software update, get more content, convince the content providers to let you upgrade the video quality (as Frommer suggests), advertise the thing properly, and Apple TV will go from a “hobby” to a real business in no time.
Almost all of Apple TV’s problems stem from the content providers not Apple:
• Not enough content
• Content’s quality (resolution) lacking
• Can’t rip existing DVDs for which you’ve already paid (as iTunes allows CDs to be ripped)
• Can’t buy iTunes Store content directly from Apple TV (as you can already with iPhone and iPod touch)
Here’s one that Apple could probably fix on their own:
• Allow users to browse the Web (which would allow for viewing networks’ ad-supported shows and other video content online)
(Apple TV is already great for sharing photos, home movies, and music on the big screen with friends and family.)
Related articles:
What’s wrong with Apple TV? – November 26, 2007
BusinessWeek’s Best Tech Products of 2007: Apple iPhone, Mac Pro, MacBook Pro; and Worst: Apple TV – November 21, 2007
RUMOR: Video rentals coming to iTunes Store, Apple TV? – November 08, 2007
RUMOR: HD content coming to Apple iTunes Store, Apple TV soon – October 05, 2007
Apple TV a work in progress, could pull in more than $1.8 billion for Apple is fiscal 2009 – October 01, 2007
Prominent Venture Capitalist says Apple TV is ‘amazing’ – September 27, 2007
Apple TV: iFlop? – September 14, 2007
Apple could sell more Apple TVs if they streamed Steve Jobs’ keynotes live – September 05, 2007
Miglia’s VideoExpress offers hardware video converter for Apple TV, iPhone, iPod – August 03, 2007
Repositioning Apple TV: sell it as ‘photo station’ – June 08, 2007
Fortune’s Brent Schlender on Apple TV: Dud or FUD? – June 02, 2007
BusinessWeek: Steve Jobs’ Apple TV ‘hobby’ boosted with improvements, much more to come – June 01, 2007
Deutsche Bank: Apple TV will cannibalize a good chunk of DVD market – June 01, 2007
Apple TV external USB hard drive support enabled via third-party patch – July 30, 2007
AT&T planning IPTV for Apple TV in 2008? – May 31, 2007
Viacom welcomes licensing opportunity for Apple TV – May 31, 2007
Analysts now see Apple TV as catalyst for the company – May 31, 2007
Apple debuts Apple TV with 160GB hard drive, YouTube integration coming mid-June – May 30, 2007
DVDxDV Pro introduces direct export from DVD to Apple TV, iPod, iPhone – May 23, 2007
Elgato releases Turbo.264: USB Stick accelerates iPod and Apple TV exports – May 16, 2007
How Apple’s iTunes Store could deliver High Definition for Apple TV – May 01, 2007
Apple reinvents consumer electronics; iPhone and Apple TV to get better over time with free updates – April 26, 2007
Apple to continually develop new software features for Apple TV, iPhone; offer free updates – April 26, 2007
Houston Chronicle: Apple TV ‘a delightful addition to HDTV setup’ – April 26, 2007
Elgato releases EyeTV 2.4 with Apple TV support – April 18, 2007
Pocket-lint reviews Apple TV: 8 out of 10, iPod for your living room very easy to use, desirable – April 18, 2007
Analyst: iPod sales may hit 500 million, Apple TV emerging as ‘a sleeper hit’ – April 11, 2007
The dam begins to break: MGM films now on iTunes Store; Apple announces over 2 million movies sold – April 11, 2007
Automating BitTorrent downloads on Apple’s Mac OS X is easy – April 10, 2007
Apple TV soon to work with Slingbox, stream iTunes library to mobile devices like iPhone? – April 10, 2007
washingtonpost.com launches high-definition video podcasts via Apple iTunes for Apple TV – April 10, 2007
Laptop Mag reviews Apple TV: ‘The best digital media adapter yet,’ 4.5 out of 5 stars – April 06, 2007
RUMOR: Apple TV team prepping update with new ‘Net-centric features – April 05, 2007
Digit hands-on with Apple TV: ‘simple to set up, a delight to use’ – March 29, 2007
Newsweek: Apple TV has a lot going for it – March 29, 2007
Hacking Apple TV: Joost successfully run on Apple TV – March 28, 2007
Apple TV software hints at future DVR functions? – March 28, 2007
Ten Apple TV myths – March 28, 2007
Ars Technica in-depth review: Apple TV ‘impressed all those who touched it’ – March 27, 2007
Analyst: Apple TV is a platform, not a single product – March 27, 2007
Digital Trends reviews Apple TV: 7 out of 10, ‘huge phenomenon will challenge conventional thinking’ – March 26, 2007
iLounge gives Apple TV a ‘B’ in hands-on review: ‘recommended’ – March 24, 2007
CNET reviews Apple TV: ‘Very Good’ – 7.7 out of 10 – March 24, 2007
Analyst: Apple TV will change the TV business – March 23, 2007
Xvid fully functional on Apple TV – March 23, 2007
Apple TV does not require Widescreen TV or HDTV, works with standard TVs – March 23, 2007
Scoble: ‘Apple TV rocks’ – March 23, 2007
Apple TV hard drive upgrade works – March 23, 2007
PC Magazine review gives Apple TV 4 out of 5 stars – March 22, 2007
NY Times’ Pogue: ‘Apple TV offers a gracious, elegant, effortless, delightful experience’ – March 21, 2007
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
Apple TV ships – March 20, 2007
Hey Apple!
Take some of that $15B cash war chest and buy Tivo. Bring the HD up to 1080p on the content, and give me the true Media Server I want!!!
Right now, I have to cobble up a solution based on a Mac Mini, a bunch of software, and chaining a bunch of disks together. Make it easy for me. Please!
Just one small correction – repeat viewing of videos is not necessarily ‘very rare.’ Anyone who has kids has likely watched some videos multiple times (Shrek, Disney movies, etc.). That does not invalidate MDN’s take – I agree that the video market supports a combination of buy and rent – it just shifts the parameter space a bit.
I love my AppleTV (after hacking it to play .avi files and mount drives from my desktop computer directly).
Gotta have both HD video and 5.1 surround. If they only do one, it’d be like building an aircraft carrier and not putting any planes on it. Of course, a two hour 720 video/Dolby Digital 5.1 surround is going to be huge – 8 to 12 GB?
We have ripped all our kids’ DVDs to AppleTV using Handbrake, and it is an amazing solution that trumps any “HDTV” for ease-of-use, price and quality. Mine hasn’t re-booted since May or so!
Add to that the ability to show off pics, and it is truly great.
Sure, renting movies and more features would be welcome, but this product needs more marketing to take off — how many “get an AppleTV” ads has Apple run?…
Sorry Apple I got sick of waiting and plumped for a Panasonic DVD recorder with a 160 gig hard drive and a digital tuner. The interface is crap, there’s no zoom and the help booklet is a bastard…but it does everything I need it to do. I waited for Apple to do something about AppleTV until I couldn’t wait any longer.
If there was a company that could possibly put a great media experience in front of consumers, it would be Apple. Problem is Steve doesn’t like to play with other people (content suppliers for one), so users wound up with an acceptable, but hobbled system.
At the very least I would have expected a direct link to the itunes store, DVR, multi format and 1080P capabilities to be obvious inclusions (not ‘near DVD quality’). The consumer interest was there for the product, and Apple should have stormed out of the gate with this thing. Instead, they waddled.
Asking consumers to open their wallets to ‘a hobby’ is pretty arrogant – especially at that price. They need to invest a little of the several billion lying around and rethink whatever their ‘strategy’ is – if there is one.
Is there anything wrong with the Apple TV.
I don’t think so.
The only thing I see WRONG is NOT many people understand the NEED for the device. It is rather confusing at first. It is no Slingbox, it is no DVDr – yet it ties in to the DIGITAL life Apple has provided us.
If you have all Apple Products, then you understand how well this device fits. If you don’t it is confusing.
WHAT Apple needs to do – is Explain the need of this device BETTER… advertise for it… show it more… get it out there…
dg
“rethink whatever their ‘strategy’ is – if there is one.” That stupid remark sounds a bit “arrogant” to me.
“Apple TV is already great for sharing photos, home movies, and music on the big screen with friends and family.”
That’s exactly what I use mine for. I bought it (1/2 price at C.C. an open box buy) so I could easily get my iTunes content to my home entertainment center. It’s great having 14000+ songs at my finger tips all playing though my home entertainment system instead of my Mac’s sad little speakers. Also it’s nice to see my digital pictures on the big screen too and simply use the remote to show them off. My music and photo albums have never been more enjoyable. But I don’t use it for iTunes video…I tried a few of the free downloads and am not thrilled with the video quality but it’s ok. I’ve become accustomed to HDTV signals now and Apple TV is just not on par with HDTV signal quality yet. My wife however has used iTunes to buy two missed episodes of her favorite show (Blood Ties) so that she would not get behind. While the video quality was ok (about like super VHS) it was clearly not as good as we’d like. But it was nice that my wife could easily get her missed episodes at a low price and with a few clicks of the mouse. Apple TV has potential Apple needs to keep plugging along and improving this product. I hope they do. For now I’ll just enjoy the convenience it has brought to my entertainment system.
Has any other company sold 800,000 units of such a device in the first year? If we had to guess, we’d say “no.” Not even close.
You’re right. Nobody has. Not even Apple. They’ve actually only sold 400,000 AppleTVs:
Apple has sold 400,000 of the gadgets since it went on sale this spring…
“Gotta have both HD video and 5.1 surround. If they only do one, it’d be like building an aircraft carrier and not putting any planes on it. Of course, a two hour 720 video/Dolby Digital 5.1 surround is going to be huge – 8 to 12 GB?”
yeah, that should download from the iTMS and stream to your TV real nice…..
where is my eye roll icon?
Apple needs to understand — and so does MDN — that the public will not know what to do with Apple TV until they buy one, but they won’t buy one without knowing what to do with it. That’s why it needs DVR. People know what DVR is, and they know they want it. Put it in there, and then sell the rest along with it.
My TEAC VHS cassette recorder is the ‘hub’ of my TV taping lifestyle. What? Theres something new out there?
Are HD movie downloads really a must have necessity right out of the gate? Could we be satisified with high-quality (h.264 compressed) 480p DVD-quality widescreen movie rental downloads on an interim basis for a couple of years until the nation gets more bandwidth in place?
480p movies can look pretty darn good on a big plasma screen, and it might be a reasonable short-term compromise in the march to achieve Internet-based movies. Of course, Comcast, Time-Warner, and the other cable companies won’t like even this. but it might work to get the ball rolling. In the long run, Apple is going to have to partner with someone like AT&T;to provide Internet service too, because the cable companies will bitterly fight online download services, just as the DVD sales outlets are … The already have taken steps to cap bandwidth and limit movie downloads, and then charge extra for third-party movies moved through their pipes — or cut off Internet customers who try to opet for this instead of PPV cable mvies…
>MDN : Almost all of Apple TV’s problems stem from the content providers not Apple:
Ahhhh… the typical stupid MDN response. It’s not Apple’s fault Apple’s product sucked. And of course to MDN (and sheep) that makes perfect sense.
—–
The Apple TV isn’t a complete waste. If they copied market-leader Tivo, it would sell much better.
more power – core duo 1.6 or so
802.11n
USB addons
–
HDTV tuner/’s
DVD drive
Big Hard Drive
Cable tuner/’s
i’ve been seriously considering an apple tv for a while now too, and have been holding off for similar reasons posted here – maybe mostly for the lack of a DVD drive. i have tons of movies, photos, music on my imac upstairs, and so far have been hooking my macbook up to the tv below.
if i were pressed to buy one in it’s current form, i might rather pay a bit more and get the low end mac mini.
Hmm…appleTV…TV… … … but where’s the TV?
yup the biggest problem with Apple TV is that it’s not a TV.
All they have to do is to fix Apple TV is rebrand it as either iTunes TV or iPod TV. I do use my Apple TV to watch video, but the main use for me (at least for now) is as the iTunes music interface to my home theater stereo.
It seems hard for the consumers to understand Airport Express as and option for piping music to your stereo and using a computer in another room as a music controller is not as good as the TV in the same room. If Apple could start with the remote iTunes message (and the photos from iPhoto) as a big selling point, then it is not as important for now that video rentals have not been worked out yet.
If there was an Apple TV (or an iPod TV) in millions of homes (marketed with the music functionality or the headless iPod), then they would have more clout to negotiate rentals with the movie companies.
It’s a product without a purpose for most people.
if the iPod couldn’t easily use CD based and P2P shared music it would have failed too.
Lets face it, for most IPod users ITMS could disappear tomorrow and they wouldn’t care because 97% of their content comes from somewhere else.
So the problem? Make it easily capable of using the video content people really use, which is DVDs, OTA and Cable TV broadcasts, Internet downloads and for the future HD-DVD or Blu-Ray