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Thoughts on Amazon Fire TV

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amazon_fire_tvLet me open by saying: clear win for Amazon. Here’s why:

  • Internet streamers are still a growing market, only present in less than a quarter of US households – not to mention International opportunities. Bringing *any* product to market under the Amazon brand is sufficient to move units. Amazon has an amazing channel to sell through, and numerous reports cite them as the #1 outlet for both Chromecast and Roku products.
  • It’s at worst a good-enough product, at best it’s the most thoroughly designed Internet STB available on the market today. Unlike the first gen of Kindle Fire, which had to compete against a mature iPad, there’s nothing utterly amazing in the category to compare against.
  • Supporting non-Amazon content is brilliant. I think they could’ve pulled off a winner just by supporting Amazon Prime and Amazon Instant Video, but now it opens up to anyone who watches any streaming content. Plus, just as Apple TV helps sell iTunes content, I’d be shocked to discover that FireTV households don’t slowly convert into Amazon content customers.
  • I’ve heard some naysay (already!) about the price point, and how it should be cheaper than Apple TV to compete. Totally disagree, no reason to do this as there’s no other magic point under $99 other than hitting $49, which I don’t see a reason to do.

Other stuff I like:

  • Voice search seems nicely done, especially in context with the mess of any 10-foot-UI experience.
  • Gaming! Very smart to make this a core component of the platform – I actually hope this remains in the cheap, simple, and easy category of gaming. Not that I don’t love trying to push 17 buttons on my Xbox controller simultaneously, but I think “Big Gaming” is just too complex these days and there’s a latent opportunity for simpler stuff.
  • Gary Busey

My two minor (emphasis on minor) missed opportunities:

  • HDMI passthrough. The single good aspect of the original Logitech Google TV product was HDMI passthrough – it let the end-user connect the device to the fought-after Input One, and work well. While I know adding passthrough isn’t going to sell any more Fire TV’s, it’s one of those little things I’ve been hoping for.
  • Not Free With Prime. Okay, this isn’t exactly fair to complain about, but I harbored this suspicion that Amazon would offer the Fire TV free with a 2-year Prime subscription. Now they always can just start a program like this, but I think it’d be a major wow-er out of the gate.

Let me close this this: building products is hard. Building really good products is very very hard. To get a 1.0 product out of the gate in such a strong state is impressive work, and while many might call it a “me-too”, I don’t. I think this is the exact right first step for Amazon in the living room, and will keep an eye on where it goes from here.

Prediction: Amazon Fire TV is the #2 Internet STB on the market (behind Apple) within 2 years.

Also, and again, Gary Busey.

What a Next-Gen Apple TV Could Bring

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While I’m not as bullish as others that the following tweet should be taken as gospel, I’ve been thinking a lot recently on what a new version of an Apple TV product could look like.

So, in no particular order… “why update the Apple TV?”

  • 4K video
    I wouldn’t bet on this, at all, since there’s virtually no content available today, and probably won’t be much in the next 24-36 months.  If 4K looks promising, they can rev again in the future.  Further, Apple has historically *not* led in this category, and I’d be surprised to see them do it this time.
  • Rich SDK
    Yes, there are plenty of apps available for Apple TV today, but access is limited and granted in an ad-hoc fashion to selected content providers.  Many folks assume one day they’ll open this up to a wider developer network -as in, all developers.  I know very little about the programmability/guts of the Apple TV, but I have to assume the current one simply wasn’t designed to be uber-expandable.  As a sub-point, I *could* see an argument for an extension of iOS here, but I’d hope it’d be a differentiated offering to relate to the different UI mechanisms.
  • HDMI Passthrough
    For the literal heaps of things Google TV has done wrong, HDMI passthrough was smart.  Enabling the Apple TV to sit on Input 1 at all times enables no-input switching for any connected experience.  But even better than that, it’s not a stretch to see a version of AirPlay with a, wait for it, transparent layer.  What does that mean?  Imagine every cool thing about Interactive TV you’ve ever heard or thought of, minus all the lame stuff, now have it actually work, powered by your iPhone/iPad.  Awesome.
  • Gaming
    Many of us already believe the next generation of consoles is doomed, but what if the Apple TV came with an optional joystick and as much gaming horsepower as an iPad or Xbox 360, and stayed at the $99 price point?  It’s the exact opposite strategy Microsoft is taking with their platform (gaming first, everything else second), but since about 1998 that’s pretty much a winning approach.

And that’s it – which is telling in its own way.  There’s no other “basic” TV/streaming need to upgrade the current hardware, and Apple certainly isn’t going to put out a new version without a very specific reason.  Perhaps I’m missing something (comment please!), but I am at a loss to come up with any other drivers for new hardware.   Oh, and yes, I’m ruling out Siri, physical motion gestures, cameras, etc – while any could certainly come at some point, they aren’t going to exist without one of the above as well.

Which leaves me with the following: if you do not think the above reasons are compelling, and you can’t come up with a better one, I think you can pretty much write off a new piece of hardware.  Further, I have strong convictions that the only truly viable option above is adding a Rich SDK/open developers kit, so if we don’t see that next week, I don’t think we see any new device show up either.

5 New Reasons Why Apple Might Not Build a TV, Yet.

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So my last time around, I was pretty “pro” on the debate of Apple building a television set device product thing. I actually was following the topic fairly heavily, and bullishly, through CES last year, when the topic just kinda sorta disappeared.  For a bit I had a hunch they had intended to launch one in the Winter of 2012, then something fell apart with it, as the rumor mill simply hasn’t been the same since.

The two reasons I surmise why they may have planned, then pulled, a set are: (1) they weren’t happy with the physical product, possibly as a direct result of LG/Samsung demoing OLED TVs at CES this year, or (2) couldn’t pull together the content/partnerships they needed to make it the success they demand.  Then again, maybe they never had a plan to do one and finally the tech media moved on to another topic.

But here I am just shy of a year since my last post, and with some new thoughts.  In no particular order…

1) Apple makes “small” stuff. Every current product they make can be easily carried out of a store.  In fact, you can almost sense it by comparing sales rates of iPhones/iPads to iMacs.  TVs are even bigger, and while Apple has magic, you just can’t shrink the physical requirements of shipping around 55″ flat panels. While they could certainly have a white glove level of service, it doesn’t “feel” Apple to me if I can’t get it in the store, and bring it home – now. Apple is amazing at satisfying the on-demand lifestyle, and a big bulky box shipped to your door isn’t quite the same.

2) Apple makes “frequently replaced” stuff. Every current consumer product Apple makes has replacement cycles under 4 years, some 1-2. TV is 7+ and I don’t see that changing.  There’s a certain point at which the inconvenience and hassle of mounting (and unmounting) big things to walls trumps the sexiness of any product.  It’s one thing to decide on a whim you’ll replace your phone or laptop, it’s another to deal with TVs and inputs.  And even if there’s a magical solution for wall-mounting and a magical solution for cable management and a magical solution for set-top boxes, game consoles, and other equipment, consumers are used to this cycle, and that’s a much much harder thing to change.

3) Apple makes “clean” stuff. Of all my Apple products, my iMac has the most potential cables to connect, most of which aren’t used, and comes with wireless peripherals. My iPad has but one.  Clean, simple, elegant – Apple.  TVs, on the other hand, must be connected to other stuff.  Unless they can actually solve A/V Receivers, Set-Top Boxes, Game Consoles, and DVD/Blu-Ray Players in a single product, this mess continues to exist.  The living room TV world is practically defined by gozintas, so unless this is a TV set just for my bedroom, or Apple can convince consumers to replace a whole lot of other boxes, it’s putting an Apple product inside a big mess.  Doesn’t feel like their style as I see it.

4) Apple makes “transformative” stuff. Smartphones before Apple, with the exception of Palm products (early days) and a few other rarities, were ugly clunky awful things that came with plastic pens. Then the iPhone came, and most smartphones are better as a result.  The iPad too, transformed the entire concept of a tablet, one so good nobody else is even realistically in the market right now (and probably won’t be for a while).  They did it before with the original iMacs.  In each case, there was an experience to transform.  But TV isn’t broken in nearly the same way – yes, there are issues, but for the most part, most consumers utterly love the way TV works today. Further, in order to transform a TV experience, Apple would need to go leaps and bounds beyond current offerings.  I’ll never count the company out on anything, but the entrenched TV ecosystem is a bigger badder monster than anyone’s taken on before.  I have a very, very hard time seeing a transformation happening here.

5) Apple makes “well-distributed” stuff.  Every Apple product is available anywhere in the US, as well as Canada and oodles of other countries.  Even when the iPhone was only on AT&T you could buy it – you might have to switch carriers, but you could buy it.  Many rumors put Apple partnering with cable companies (eg buy an Apple Television from Comcast with a 2-year contract, at a steep discount), but this limits distribution regionally in a major way.  This would force them to deal only with satellite companies, but that brings an entirely different set of hurdles.  This effectively rules out distribution partners as a deployment vehicle, which then in turn limits the product to being a “dumb set” – something that seems even less likely for the company.

I may be wrong.  Heck, it’s Apple, they know how to solve problems others can’t even begin to figure out.  Let’s also be real and notice that their little “hobby” is already the #1 Internet streamer on the market, in a single year! But something about the magic needed to make a TV might be out of reach for a little while longer here.  Seems like until OLEDs become affordable (or some other equivalent step up) and until there’s a viable MVPD with full Internet distribution, we are going to have to wait a little longer for a glowing bezel to show up in our houses.

The Only Two Ways People Watch TV

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Over the past 30 years we’ve evolved the television experience from something where everybody watched the same shows on the same channels on the same devices in the same rooms at the same time to a world where that’s almost never the case.  Today, with the exception of appointment TV, it’s such a fragmented landscape that it’s almost a challenge to find other people watching the same stuff you do.  But with all the variance in content, services, devices, location, price, etc, there’s still really only two ways people choose to watch TV.  This is a subtle, but extremely important concept to anyone in the business of changing television.

Deliberate viewing: you go to the TV with a specific piece of content in mind.  This includes live TV (“let’s watch Idol at 8pm tonight”), your DVR (“I need to watch last night’s 30 Rock”), and any VOD/OTT platform such as Comcast OnDemand, Netflix, Hulu, etc (“I’m going to watch the first season of Breaking Bad”).  We could also include a deliberate type of content in this category (“I’m going to watch a comedy” – not necessarily something you’d say out loud, but if you are in the mood for something funny, that’s a pretty deliberate concept).  I also refer to deliberate viewing as “search mode” for TV, since you will specifically search for the piece of content you want, whether by changing the channel, navigating your OnDemand menu, or going to your DVR library.

Random viewing: you go to the TV with no idea what you want to watch.  This includes simple channel surfing (“nope, next!”) as well as direct channel changing (“I wonder if anything good is on TNT now.  Maybe Shawshank or Blues Brothers??”).  It also includes browsing the OnDemand options (“I wonder if there’s anything new on Netflix?”) and even your DVR (“Maybe we recorded something we haven’t watched yet?”).  I also refer to random viewing as “browse mode” for TV, since you are just perusing lists of stuff until you find something you are content to watch.  Note the last phrasing here, as random viewing is less about the “excitement” factor of watching something deliberately, and more about the “good enough to pass the time” factor, with the potential for excitement.

Now for the cold, hard fact: any “future TV” service or product which doesn’t account for both types of TV viewing, will fail. This includes OTT services, smart TV apps, second screen apps, third screen apps, eighth screen apps, widgets, websites, gadgets, platforms, and everything else under the hood.  Again, if you cannot service both primary needs of a viewing audience, your system is a goner – unless, that is, you are specifically aiming to replace an existing component of those services (in other words – if your live TV service is designed to replace another live TV service, that’s viable, since the consumer’s ecosystem will still include whatever else it had before).

How do I back this up without cold, hard facts?  Because people don’t really change much, and TV, specifically, is not merely “another” activity up there with Angry Birds, Facebook, Pinterest, reading books, etc.  Watching TV is a very specific type of activity, one about entertainment and more importantly, escape.  Life is hard, TV lets you escape for a period of your day – why on earth would Americans spend 4-8 HOURS per day in front of it otherwise?

So if people don’t change, and people need escape (especially as they age – I’m not talking about 13 year olds here, for the most part), they need some version of deliberate and random lean back TV watching.  Could this include YouTube videos? Sure. How about an all-on demand lineup?  Doubtful.  How about a “TV is just an app” concept? Doubtful. It’s why most cord-cutting theories aren’t holding water.  It’s why #SocialTV is still mostly just a fad. It’s why most “second screen” apps are just barely gaining traction. It’s why Google TV is such a mess right now.  It’s why Apple TV is still a hobby.  Sure, these things work absolutely great for some, but absolutely don’t for most.

The future of TV involves a lot of change.  And the more things change, the more they stay the same.  Long live TV.

The Case Against an Apple Television

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I’ve flip-flopped better than a politician on this topic, but just read an awesome piece that I wanted to share.  Highlights are:

Most fundamentally, all assumptions about Apple seem to stem from a misunderstanding of how differently Apple thinks and operates from everyone else.

For starters, Apple doesn’t chase markets just because they’re there. Nor do they get sucked into market share battles just so they can say they sold the most units (see: iOS vs. Android).

…

In other words, for an Apple TV to be free-flowing with first-tier TV content in the same way that an iPod flows with first-tier music, Apple will need DIRECTV and/or Comcast to bless it.

ESPN, after all, earns $4.69 per subscriber household in affiliate fees on each and every cable subscriber. Apple’s good friend, Disney, owns ESPN, ABC, Disney Channel and a slew of other channels. Disney simply isn’t going to throw billions of dollars away in affiliate fees just so they can help Apple. All of the major TV content players view the world similarly.

…

So where does that get you when you connect the dots? I’ll tell you where it doesn’t get you … to a television-like device that:

  1. Is priced 2-4X the cost of an iPad.
  2. Has sales cycles of one device every 5-10 years.
  3. Has bad margins.
  4. Has a serviceable form factor that for many people is good enough. (Apple challenges industries where the baseline experience is terrible. Television hardware wouldn’t seem to qualify.)

I strongly recommend reading the rest of it as well, one of the best perspectives I’ve seen on the topic of Apple in general actually.

Why Smart TV User Interfaces Suck

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Please don’t look at the following images on a full stomach:


Ok, sorry I had to do that, but it’s important.  And to my friends on the TV manufacturing side of the world – it’s not your fault!  It’s not your fault! Most “Smart TV” user interfaces, suck, and you’re doing your best.  But fundamentally they violate so many rules of user experience design. But why are they so bad?  In a nutshell, its for the same reason you don’t expect loggers to sell fancy high-end furniture (think about that one for a second).  The products are being built from the wrong end of the production team.

For the dining room table, what do you think, arrow foot or ball foot?

Let’s agree that user experience design is a challenge to begin with.  Apple does it great, everyone else, not so much – and even Apple products have flaws.  Further, virtually everything about a “ten foot” user interface (the terminology we use to describe what happens on-screen on your TV) is a broken interaction model, so this is going to be crippled no matter what.  I’ll write about this more in the future, but I believe there’s a fundamental breakdown on the limitations of what you can do with any 10′ UI and a remote control, regardless of gestures, speech, etc.

Next, per my logger analogy, effectively the teams building these products have absolutely no experience nor expertise at this kind of design.  The world of consumer electronics has (barely) evolved from dials, knobs, and switches to doing highly complicated interfaces on screens.  Not only that, every year the requirements are changing!

And since this is a new field (despite almost 20 years worth of ten-foot UIs), there are very very few folks out there who have dived deeply into this problem (the Wikipedia page on the topic barely even requires a scrollbar to read everything).  So the same people who are used to just getting the TV to work right, are now also in charge of creating “an experience”.  I think this is a guaranteed to fail situation, and it’s unfortunate for everyone involved.

The last "easy" TV user interface.

I do have some tips and thoughts for these UIs, since I can’t effectively get everyone to just up and stop making them (pretty please?).  First, you can read my comments a while back on designing better Boxee and Google TV apps.  Now, here’s three more things to think about:

  • Stop making things look like Commodore 64 graphics.  Seriously, I understand the graphics processors inside the TV platforms are low powered inexpensive solutions, but people have a natural (bad) reaction to seeing such low quality graphics on their beautiful HD sets.  If you can’t match them up, find ways to cut down on the overall interface and use the scarce resources to make things prettier.  See Boxee, Google TV, and Apple TV for the “prettier” 10-foot experiences.

Now in beautiful Full 1080p HD

  • Understand a 2D “grid” of options.  Many of these UIs create multiple planes of interfaces, yet fail to recognize the user has to navigate with a simple UDLR remote control (or wand or whatever).  This creates unpredictable experiences, and makes your user less naturally comfortable with the interface.  You should be able to look at the screen and always know “what happens if I push the Up arrow button”.
  • Reduce button clicks.  At no point should the user have to click more than 3 times to get from one part of the screen to another, and you should never create an internal scrollable region.  For example, my VUDU service (which I love) has me scroll through long lists of movies when browsing a category (such as Comedy/Drama, which, let’s face it, really means depressing movie with some funny moments).  But, as a result, if I want to change the category,I need to scroll all the way up to the top of the screen again to choose a new option.  This is too much work!

Ultimately, this again reinforces my belief that anything new coming from Apple will be highly based on AirPlay concepts, and the 10-foot UI will one day be a thing of the past.  And what will replace it?  This.

Decoding "I Cracked It"

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As Nick Bilton wrote:

“I’ve finally cracked it!” Steven P. Jobs, co-founder of Apple, told his biographer, Walter Isaacson.

This topic seems to come up time and time again in the “future of TV” discussions, and was revived today over at AllThingsD: “Though it’s currently only embedded in the new iPhone 4S, Siri could eventually change the face of the TV industry.”  I’ve seen a few other stabs at what “cracking it” could possibly refer to, but none seem quite right.

First, regarding voice-controlled TVs.  Is this part of the future?  Absolutely, unquestionably, undeniably.  Siri hacking is already a hobby, and the idea of “TV, channel 702 please” or “TV, Watch The Office” or “TV, Record New Episodes of Arrested Development” all sound great.  But how much of an improvement is this really?

I’d call it a minor enhancement – specifically in context to all the action happening in the second screen. If you can pick up your smart phone or iPad and perform roughly the same query in one of dozens of apps, then “talking” this command doesn’t really sound like a HUGELY big deal.  It sounds incremental.  And “cracking it” doesn’t seem like it’s about incremental.  As I’ve written about previously, I don’t think it’s about physical gestures either, and as I’ll write about more in the future, it’s unlikely “apps” nor about some “new” 10-foot user interface (those are terrible, and are dead, thankfully).

What if the interview wasn’t about some futurey thing we’ll see one day?  What if it’s not some mystical innovation that we can’t possibly fathom?  See, I talk to virtually everybody in the future of TV industry, and not a single person seems to be able to imagine what this could be.  That’s a whole lot of smart, industry-relevant, savvy people to be so in the dark.

So I’m going to take a giant leap backwards on the statement “I cracked it” and instead of looking at what might come, I’m looking at what’s already there.  See, from my eyes, the single biggest improvement to the TV experience I’ve ever seen happened last year.  I think “I Cracked It”exists, and it’s called AirPlay.

AirPlay takes a fundamental mindshift from thinking about whats happening ON the screen, where you have to use a remote (or gesture or voice or whatever) to control some awkward, ill-performing, frustrating, fundamentally LOUSY user interface.  AirPlay shifts the interface to your favorite location, the device you hold, and carry with you all the time.  AirPlay enables you to have the most organic, natural, helpful user experience you can, then just shift that experience to the device you want, easily and flawlessly.  It’s an awesome experience.

For the record, I don’t mean this to be a gush about Apple TV / AirPlay – merely the experience the two together provide, one I anticipate will be replicated by others, and soon. The future of TV interfaces will be controlled by your second screen, and you’ll have one simple way to get it to the screen of your choosing.  Today that’s done by AirPlay, but by the end of 2012 you’ll see this type of offering from a variety of manufacturers and app providers.

The first “moment of change” for TV user interfaces happened in the late 1990s by TiVo.  The next one happened in 2010, by Steve Jobs & Apple.  And yes, he cracked it.

If AppleTV is 1/3 of the market, who's selling the other 2/3?

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A few blogs are reporting about Strategy Analytics’ recent claim:

Strategy Analytics projects that the market will reach almost 12 million units globally this year, with Apple alone predicted to sell nearly four million devices.

Wow. Pretty bold claim.  Let’s deconstruct it.  Let’s assume it’s a correct prediction:

AppleTV will sell 4 million units, leaving ~8 million for “the rest”.

what do you mean "and the rest"?

Here are “the rest”: Roku, Western Digital, D-Link (Boxee), and… er… I don’t know, how about Logitech? Maybe a few other smaller players, but nothing you and I are buying in a Best Buy, Target, Walmart or Amazon – the only places that matter at all for moving these kinds of numbers.  Yes, there are some other odds and ends in the bizarre category known as Internet Set Top Boxes, but they aren’t mustering up sufficient sales to count here.

Roku: I’ve heard all sorts of things, but lets use publicly available information: as of last January, Roku hit 1 million devices sold.  I’ll assume they’ve at least doubled that in 2011, possibly as much as tripled, due to new products, more viability, and lower prices.  That said, they are now up against an ever-improving AppleTV product.  Even so, let’s assume they can hold pace against the world’s largest marketing machine for digital lifestyle products, and sell another 3 million units in 2012.

Western Digital: You probably haven’t heard of it, but that little gadget your buddy has for watching photos on his TV is called the WDTV Live, and they’ve sold somewhere in the 1-3 million unit range (I know that’s a big range, but it seems pretty fair based on some poking around).  Not a bad showing for a company known for making hard drives.  But in the presence of both Apple and Roku, it’s a pretty fair bet that they aren’t edging out of third place for future market share.  I’ll again be kind with 1.5 million units sold in 2012.

From these guys, only for your TV. Perfect.

D-Link (Boxee Box): Disclosure: I was a core part of the launch teams for both Boxee and the Boxee Box by D-Link, and wish to see them extremely successful, though I am no longer professionally engaged with either company in any way.  And that said, I don’t think they’re anywhere close in numbers yet, and don’t see them hitting the million unit mark any time soon (specifically in regards to unit sales, this has nothing to do with downloads, active community, or positive thoughts). Optimistic high end prediction in 2012: 750K units.

Logitech: $100 million loss.  Let’s move along shall we?

Have the factory spin up about a bajillion of them, nothing will go wrong.

Everyone else: I’ll generously band them all together, and predict they maybe move 500K units.

Unknown entry by traditional consumer electronics brand: Look, anyone can make a media streamer, in fact you can make an adequate one by buying off the shelf parts and licensing open software platforms.  But even the formerly mighty Sony and the young stalwart Vizio is going to have a tricky road in getting a product out in this category that doesn’t include a full end-to-end solution.  And there just aren’t enough to go around.  Maybe Amazon could have some kind of Kindle Fire: Home Media Edition or something, but something tells me they are still getting their feet wet in hardware and aren’t going to jump too rashly into the space (though I’ve been known to be wrong about Amazon and hardware in the past).  Top guess: 250K units.

Grand Total Units Sold, Highly Optimistic Prediction Mode: 6 million units.  Giving Apple TV, with 4 million sales, a 40% market share.  And that’s me being *quite* optimistic, and I’d wager it’s more like a grand total of 4 for the rest.  Or less.  Giving Apple TV a significantly larger potential – and by the way, it’s not exactly Apple’s strongest product.

But their math was so good!

This whole story just reminds me of the time when I was reviewing an analyst report for the *exact same space* back in 2003 when we had just shipped the HP Digital Media Receiver (the first mainstream Internet Set Top Box, by the way).  This was, by the way, before consumers had Flips or other simple video recording devices, digital cameras were mostly a novelty, and there was no YouTube, Netflix streaming, or pretty much anything else to watch on the darned thing.  But still, the potential!

The analyst predicted hundreds of thousands of “streaming video boxes” sold in 2003.  The only snag was, we were literally the only game in town, and we had predicted tens of thousands at best.  When I spoke with the analysts, they said they predicted several years forward, based on consumer interest, to arrive at several million units a year.  Then, they backtracked it into 2003 and, boom, hundreds of thousands.  What could possibly go wrong with this kind of logic?

They sold literally dozens of them

Why iMacs will get Apple TV, not Apple Television

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Ah, Apple punditry, rumors, and speculation.  And back into TV land we go.  Today from Forbes:

Wedge Partners analyst Brian Blair this morning asserted in a research note that that the next version of the iMac, likely in the 2012 first half, will include some new TV functionality – basically, turning the desktop Mac into a bridge to a full-fledged television business.

This, plus another analyst who seems to know the exact sizes of the new long-awaited Apple Televisions is certainly fun reading.  But what parts make sense?

iMac + Apple TV?
Yep, makes sense.  After all, we’ve had Front Row in Macs for a long time now, it’s way overdue for an update, and having it function identically to Apple TV is a nice fit.  I’m buying this one.

iMac + Apple Television (aka iTelevision)?
To be a “television” a product, for the most part, includes a buit-in TV tuner.  It also has multiple inputs, and has all sorts of requirements/parameters for video display.  These components are effectively inconsequential to add, cost-wise to an iMac, so from a pure “could they build it feasibly” perspective, this actually passes a sniff test.

However,  what is this new product?  Is it a big computer “Now, from Apple, a 46″ iMac that you put in your living room”?  Is it a small TV “Now, from Apple, a 27″ iTelevision that fits nicely on your desk”?  Is it all of the above “Now, from Apple, in 7 different sizes, with 11 configurable options, the iMacTV.  We cook it your way”?

You know what it is?  Frankenstein.  Confusing.  To throw in some industry jargon – it’s what we’d call a “hodge-podge”.  Hard to explain.   How many other products that Apple ships are described like this?  None.  It’s the antithesis of an Apple product.  It’s something a PC company might do, certainly, but not Apple.

I still believe that iTelevision is coming.  I think we’ll, at the very least, learn a lot about it in 2012.  But there’s no weird “mashup” device coming.

They don’t ship iHodgePodge, not at 27″, 32″, or 55″.

Expectations for Tim Cook's Oct 4th Event

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The rumor mill has it that Oct 4th is the next big Apple event, in which we can expect to see Tim Cook kick off his term as CEO.  Here are some of my thoughts on what we can expect , in no particular order (note that I’m skipping all the pre-announced stuff, like iOS 5, etc):

No Steve Jobs
A variety of folks are speculating on whether or not Jobs will make an appearance.  I’d say absolutely not, other than possibly in the audience.  Jobs walking on stage would undermine Tim’s role as CEO and send a weak message to the media.  It’s time for Cook to run the show, and Wall Street in particular will be paying close attention to his every move (yet another example of how Wall Street’s mere presence harms us, but I’ll save that snarky feeling for another time. too late).  Granted I think we’d all love to see Jobs make an appearance, but unless they can figure out a way to do so without sending a lack of confidence message, I’d assume he stays on the sidelines.  This, by the way, will lead to rampant speculation about his health, again (under the veiled theme of “its news!” – tip: it isn’t, let the man be.).

Major Refreshes to Most Products
With one exception (below), I believe almost every product the company makes will get a refresh, either major or minor.  We already know about iPhone 5 and iOS 5, but rumors across everything else have showed up as well.  Per the above, it’s time for Cook to show his quality, and I think they’ll opt for over-delivering.

No iPad Updates
It’s just too soon.  Apple would frustrate their existing (huge) iPad base, and steal from whatever they’ll be doing in 2012.  Also, a complete dearth of competition in the space enables them to take their time and raise the bar next Spring.

New Presentation Style
Whomever created the “Steve Jobs Presentation” obviously deserves some kind of award.  But what made his style so special is how well it was tuned for Jobs.  I believe they’ll re-create the concept for Tim to enable him to deliver his own personal touch.  I don’t think it’ll be a massive departure, but I do expect some change.

Major iPod Changes
I wouldn’t be surprised if, starting next month, the iPod product line is reduced to the Touch and Nano (with WiFi), and everything else is gone.  That really is the purpose behind iCloud, and just like the company is killing off physical drives, it seems like the traditional iPod isn’t part of the new vision of the Apple digital lifestyle.  I’d like to see some minor “apps” for the Nano personally, but that might be a stretch.

One More Thing – iTelevision?
If they even continue with the “One More Thing” it could be the actual launch of the fabled Apple Television Set.  Or it could happen in 2013.  Or never…

Tune back on Oct 5th to review how I got 5/6 of these things wrong. 🙂

Musing on Apple Building a Television

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I don’t think I’ve ever waffled on a topic as much as this one.  Back in ’07 I wrote two articles on Apple “owning” the living room and building TVs.  Ever since, I’ve gone full tilt in both directions.  Until about a week ago, I agreed firmly with Erik Schwartz on the topic, as he wrote today:

I am quite sure that there has been a team at Apple working on TV projects for literally the last 20 years. I am also quite confident that they are not going to release a TV in the near future.  (read more)

He continued to espouse on the four issues he saw: Margins, Replacement Cycles, Logistics, and Integration.  And on all four counts, I’ve agreed with him.

But now I have second thoughts.  My friend and coworker Adam Burg has long been a believer of “iTelevision” as has Dijit (and TiVo and many others) investor Stewart Alsop (who was quoted today in VentureBeat’s article on the topic).  For them, and many others, the rumors were way too much smoke for a lack of fire.  And on that point, I tend to agree that the rumors are a little stronger than what the Apple PR team will let flow when there’s no substance whatsoever.

So first, the case against iTelevision

Generally speaking, the two strongest “con” arguments are:

1. The margins in TVs suck, and since you can’t get away from the reality check of what it takes/costs to make a TV (hint: glass), the margins will suck for Apple too, and Apple doesn’t play in the “sucky margin” business.  This would force Apple to make a notably more expensive TV than anyone else, and even Apple can’t somehow get people to spend $1500 on the same sized screen they can have from Samsung for $1000.

We make THIS many!

2. The TV replacement cycle sucks, as the average family won’t replace a TV for ~7-8 years, and that’s not a world Apple typically plays in either.  Unlike phones (1 year) and PCs (2-3 years), consumers won’t be up for buying a new set very frequently, and the concept of having an “outdated” television will cause more infuriated people than Apple typically likes to create.  Note: this is a concern of the entire “Smart TV” industry (well, it’s probably not, but it really should be), and you can mark my words that backlash is going to hit these manufacturers in the next 6-12 months.

I’ve had a 3rd argument personally, which is Apple can’t make an iTelevision for $1000 whilst selling a “$99 upgrade” Apple TV product that brings the same functionality/services to any other manufacturer’s device.  Now the counter to that would be the Apple TV is there to enable wider content consumption, etc, but it’s still generally considered a “no-no” to cannibalize your own market.

We'll pre-announce while our existing product is on the market. What could possibly go wrong?

So now, why I’ve come around, and the case for iTelevision. I’ll start by refuting the arguments above.

1. Apple makes awesome margins on everything. If Apple’s building a TV, they’ve figured out their own amazing supply chain methodology to do it profitably.  Very profitably.  So if everyone else is selling a 50″ LCD for $999, they will too, only instead of making less per unit than the price of a really good bowl of soup, Apple will rake in the cash as they go.  They are the only tablet manufacturer selling at a real profit (HP not withstanding.  What, too soon?),  and I see no reason why, if they enter this space, they won’t do the same thing.

2. Apple will change or solve the replacement cycle issue.   Before iPhones, the US market was radically less likely to buy a new phone every year.  I have a much harder time accepting that Apple can successfully convince people to lug a 50″ screen home (and correspondingly, out of their home) once a year (or every other year).  This is way too painful a process, even for a fanboy.

I'm on a truck!

This implies either Apple can make a TV that is easy to move/replace or the components which would require upgrade can be guaranteed upgradeable for a few years.  Both are actually feasible, though the former requires some more impressive technology (flexible or roll-up displays, for example, could do it).  The latter is probably more likely – after all, even the original iPhone can still run a lot of the apps that are on the market.  What would matter the most here is that each generation of iTelevision is guaranteed to mostly compatible with the same content offerings as future generations (in other words, regardless of apps and whatnot, if Johnny Homeowner’s TV can only play 1/3 of the movies as his neighbor, he’s pissed – if he can play mostly the same stuff, just no Angry Birds, he’s less so).

3. They could coexist, if the other product is iTelevision and it isn’t the same thing as an Apple TV. So if the rumored iTelevision isn’t about “Apple TV inside a flatscreen” and is instead something new/different, this could be more feasible.  I’ve heard and debated scenarios ranging from built-in DVRs to TV tuners to CableCard and more.  Here’s all I know: whatever they do will be fully end-to-end thought out.  You won’t buy an Apple TV then have to go to the mall to pick up a CableCard.  You will do everything in an Apple store or online (or from your phone), and it’ll just work.

If I have to weight the pros vs cons these days, I have to say, the pros seem to have it.  Will it come out in 2011 or 2012? Hard to say.  Will they dominate the TV market the way they dominate tablets? Unquestionably NO, but they’ll probably profit more off the sales of TVs than anyone else, more akin to what they do in phones.  Will they shock us with their offering when it comes out? Probably, though probably in the same “why isn’t everybody just doing it that way” style they do with everything else.  Will they create a massive gaping wound in the side of the TV industry, and opportunity for a brand new type of ecosystem to emerge?  Absolutely.

Now, back to the waffling.

Roku vs AppleTV smackdown

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I don’t have cable. But I watch a lot of TV.

For my birthday I got a Roku and after tooling around with it for a couple of weeks, I cut the cable cord, much to the wife’s chagrin. Then, last Christmas, I found under the tree an AppleTV (although it is small enough it could have gone in the stocking.)

AppleTV and Roku essentially inhabit the same space. Both are around (or under) $100, both are solely media streaming devices and, unlike the mythical GoogleTV or the enigmatic Boxee, neither offer web access.

So with no methodology and no experience in product reviews, here is my official, unauthorized, David-vs-Goliath head-to-head streaming media device smackdown. In one corner, Apple, the single greatest human accomplishment in the history of the universe; the company that proves Intelligent Design is real. And in the other corner, Roku, which means “six” in Japanese.

Design

OK, this isn’t really fair because this is where Apple has always excelled. When I first got my Roku, I thought it was a pretty slick device. Black plastic, pleasing angles and the size of a turkey club sandwich (hold the mayo). Then I unwrapped the AppleTV and…. My God you’re beautiful! So small, so sleek…

I looked at my Roku, what is that hideous oversized slab of a streaming device currently attached to my TV?

Point: Apple

UX

I won’t even go there. Apple’s is amazing… Roku’s has always sucked.

Point: Apple

Content

So this is where it gets interesting. The gateway drug for both of these is Netflix and Pandora, which are both awesome services and the reasons why the sun still shines in my world. But what’s there beyond that?

With Roku, yes there is MLB if you like baseball (I don’t) and HuluPlus if you’re able to figure out why you would want it (I can’t). Where Roku really shines is access to all the weirdo webTV shows on Koldcast, Blip.TV, Revision3 and so on. You have to really like web-only TV and fortunately, I do. The wife doesn’t so I end up watching a lot of it by myself. You can also watch Al Jazeera streaming live on Roku in the event you need more proof as to how f-ed up the world is.

With Apple TV, your channel flipping will lead you to YouTube or to all the various audio and video podcasts on iTunes. That may sound lame, but it really isn’t. There is a ton of great stuff there and most of it is pretty bite-sized. So in 3-5 minute increments you can flip from news to comedy to movie trailers… unless you land on the “This American Life” podcast, in which case you’re stuck on the couch listening to your TV for an hour.

Winner of this round? I’m going to give it to Roku. I love all the cheese that webTV has to offer. My big complaint is again the UX… it is hard to find content and then to remember which channel it is on if you want to go back to it.

Reliability
So here’s the knock-out blow… this goes to Roku. Yes, it is close, but Roku wins it. I found a better picture and fewer artifacts when streaming from Roku. Also, surprisingly, AppleTV hung up and crashed more than the Roku did. Not by a long shot, mind you, but enough to notice.

Final Verdict

If you like design, UX and more mainstream content, you’ll love AppleTV.

But this is my smackdown and I’m giving the prize to Roku. They’ve got the edge in reliability and I love the goofy webTV access… but that is just me.