So An Apple “Hobby” Leads the Market
July 17th, 2013Officially, Apple TV, a video streaming set top box that costs a mere $99, remains a “hobby” or “grand vision” for Apple, depending on which comments from Tim Cook you take seriously. Perhaps both are correct. However, that doesn’t mean the Apple TV isn’t successful. In fact, it’s the market leader.
So here we go with yet another survey. This one comes from Frost & Sullivan, a market research company, which states that, in 2012, the Apple TV had a 56% share of the streaming video player market. Way behind was the Roku, with a 21% market share. The report concludes that Apple TV has a “relatively narrow content access,” although it has grown recently, but attributes the product’s success to AirPlay, which lets you stream content to your TV set. The firm concludes that “AirPlay is the primary reason for purchase of Apple TV devices.”
That Apple has been regularly adding new content offerings, such as the recent addition of HBO Go, isn’t being considered. To be fair, this survey was also based on 2012 sales, and the results are no different from what Apple has said already about the success of the Apple TV.
In contrast, Google TV, that company’s effort to gain a foothold in the streaming video space, has apparently been consigned to the “other” category. These results clearly don’t support the promise from the company’s executive chairman, Eric Schmidt, that “by the summer of 2012, the majority of televisions you see in stores will have Google TV embedded.”
Yes, there are still a handful of tech pundits who are high on Google TV. But certainly not Logitech, which took hundreds of millions of dollars in write-downs when their Google TV gadget failed big time in the marketplace. Maybe they should have asked Google for a refund, but they only have themselves to blame for being taken in by the promise of this misbegotten platform.
However, current success doesn’t necessarily prove that Apple TV is a keeper. Selling more than 13 million copies of anything would be considered a huge success for almost any company outside of Apple. But Apple TV is a product that remains in search of an unspecified goal. However, it is far more useful than the Frost & Sullivan report implies, since there are a reasonable number of streaming services beyond what you can do with AirPlay. There is iTunes, plus 13 third-party services, which include Netflix, Hulu Plus, YouTube, Flickr, and other video services, including sporting events and news.
Maybe the current Apple TV won’t let you cut the cable cord, but it may come quite close. I can see a lot of you surviving happily with Netflix, Hulu Plus and iTunes, along with hooking up an antenna to get your local high definition broadcast stations. If you are careful about what you rent or buy from iTunes, you will keep your monthly investment really low.
Yes, Roku, aside from the lack of iTunes, has far more streaming services from which to select. But there are reports, apparently reliable, that Apple and Time Warner, parent company of HBO, are soon going to agree on a new deal. That pact will let customers of Time Warner’s cable division access the service on an Apple TV. The stories, emerging from the usual “informed sources,” don’t clarify how time-shifting will be handled. Maybe Apple will work with Time Warner to use a cloud-based DVR. There’s even talk, also unconfirmed, of a commercial skipping feature available as an extra cost option.
Such an agreement, should it come to pass, may pave the way for Apple signing up other cable and satellite providers. Certainly accessing your cable service through the integrated Apple TV environment, with access duplicated on your iPhone, iPad and Mac, might actually bring more business to these companies at a time when subscriber growth has mostly stalled.
For Apple, this would be a terrific way to expand the reach of the existing Apple TV, and perhaps pave the way for a souped up model that, I would hope, would offer seamless integration of all your connected accessories, including a Blu-ray player and a gaming console. Maybe Apple would prefer you didn’t use those gadgets, but that doesn’t mean they shouldn’t be supported. I can see the potential of Apple TV becoming not just the streaming device, but a universal remote that eliminates the awkward process of making all the components in your living room play nicely together.
Yes, there are lots of universal remotes on the market. Some TV and cable box remotes can also be programmed to handle other gear. But programming all of them to work together smoothly, and somehow managing to aim the remote so it reaches the various sensors on all your gadgets, is not a seamless process. I have already mentioned how my Logitech Harmony 900 remote, which supposedly works with just about any consumer electronics gadget out there that comes with a remote, is often difficult to program. And that’s with a mass market TV set, such as a VIZIO.
In any case, I’m encouraged by the success of the Apple TV. I just wonder where Apple is taking their hobby, and when that goal will be revealed. Regardless of where Apple TV goes, though, it doesn’t mean that Apple is also planning to release a connected TV set. Sure, maybe it’ll happen, but Apple could also work with existing manufacturers to embed Apple TV and use its interface for all key control functions. Strange? Well, consider what Apple is doing with auto makers.
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An article on pretty much the same topic only Google-centric:
http://www.nytimes.com/2013/07/17/business/media/google-is-said-to-mull-internet-cable-service.html?ref=technology&_r=0
One possible change that I’d like to see in any “over-the-top” service is when the user is using the cable company’s ‘Guide’ (or some similar app) that the user sees only the channels that are available in their package. Not every channel offered by the cable company. For me, it’s really annoying to have to wade thru a bunch of options I don’t have. And I really doubt if there have been a large percentage of users who upgrade their package because they see other channels in the ‘Guide’.
As far as Google goes, if I were the TV networks, I’d be even more leery/afraid of Google than of Apple. Though Apple has the iAd program, its main business is hardware. Google’s main business is advertising. The networks main business is advertising.
And I’d be surprised if Comcast didn’t try out some over-the-top service itself. They have a lot more leverage with the channel/content owners than either Google or Apple.
@Ted Schroeder, Of course, Comcast is a content owner. 🙂
Peace,
Gene
@Gene-
Since Comcast is not only a content owner, but a cable company and an Internet Service Provider, they probably have the best shot at making a deal work. I’d guess that between studios like 20th Century Fox and production companies like Bad Robot and independent local affiliates and organizations like the NFL, there is a real rat’s nest of legal agreements and contracts. Who has the right to distribute what and how much does who pay to whom, etc.
Now, from Apple’s point of view, take that rat’s nest and multiply it by all the media markets in all the countries that Apple does business in. That’s a lot of legal jambalaya for a lot of lawyers.
And -just in daydreaming mode here- if they could pull off some sort of global arrangement, it would be pretty cool to get a lot of foreign programming…
(It might finally make that guy who always looking for Formula One programming happy..;)
Apple will need a deal with the major sports leagues for consumers to finally cut the cable cord. That may never happen since they are so locked into the networks and ESPN. If they were able to stream sports, I’d buy an Apple TV, or any competitor who managed this fete, in a heartbeat.
Love my Apple TV. Cut the cable. The only thing I really miss is all the Red Sox games (sorry Gene) on NESN.
But that exposes one of the current downsides of rejecting the cable monsters. MLB.com subscriptions, available through Apple TV, are only for out-of-market broadcasts, which means I can’t watch the Red Sox (you can’t watch the Yankees/Mets, etc.) More importantly as concerns Apple TV, though, I tried Hulu Plus and dicovered that not all of the programming which Hulu delivers over the web is available through Apple TV. Apparently, Hulu’s contract with Apple has a lot of restrictions. My guess is that Apple wants to make sure they can sell you episodes of this and that rather than you watching all you want on Hulu Plus. The logo on the Apple TV should properly read Hulu Minus!
The ease with which Apple TV integrates with the rest of my Apple gear makes it very useful. I’d recommend it to anyone already in the Apple “ecosystem.”
@Ponter – My guess -and it’s only a guess- is that any restrictions on Hulu Plus come from production companies, not Apple. For instance, American Dad is made by 20th Century Fox Television, Atlantic Creative, and Fuzzy Door Productions. It’s on iTunes and it looks like it’s on Hulu Plus (judging from the Hulu site). Is it on Hulu Plus for AppleTV?