Report: Apple TV is Shelved for 2012
September 6, 2012 7:46 PM
comment(s) - last by
Seven years later and Apple still hasn't quite cracked the smart TV equation
The perennial rumors that Apple, Inc. (
) is preparing to launch a
"smart" LCD TV
advanced set-top box
dealt a blow
which cites multiple sources as saying the project has stalled on Apple's inability to
cut a deal with content providers
I. Building a Better Box
The news service reports that Apple engineers have been working since 2005 to make a super set-top box. Inspired by TiVo, Inc.'s (
eponymous recording hardware
and other smaller players like Roku, Apple aimed to beat perennial rivals Amazon.com, Inc. (
) and Google Inc. (
) to expand the role of the digital TV.
Today Apple is selling, according to a (calendar)
Q1 2012 earnings
call, 1.4 million units of its AppleTV. That may sound okay, but compared to the distribution deals TiVo owns, and sales of other Apple products it's pretty abysmal.
The problem is that Apple's current product -- in its third generation -- lacks many features, while actually regressing in some ways on others. Early models had hard drives (40/160 GB first gen.), but Apple ditched the mildly useful feature for streaming only -- a cut it justified by a price drop from $229 to $99 USD.
AppleTV is smaller and sleeker, but now lacks a hard-drive. [Image Source: Engadget]
The device also lacks a built-in browser or useful apps other than select service portals from a handful of partners like Netflix, Inc. (
) and Google Inc.'s (
) YouTube. And those services are also offered via TiVos and Rokus.
But Apple's vision for its better box began and remains with a much more ambitious dream than the cheap but currently model. Apple envisioned an advanced device that could double as a game console, receive live content (over the internet), from television networks (
), record shows via a built in hard drive, play pictures/songs, surf the web, and watch internet videos. More recently it even planned to use its iPhone smartphone and iPad tablet as controllers, taking advantage of the devices' built-in Bluetooth capabilities.
II. Content Providers -- a Tall Hurdle to Jump Over
To make this dream device Apple has to come together with television content producers to allow streaming shows and recording. While TiVo can essentially do what it wants, the TV content creators have a degree of leverage over Apple. As the largest digital distributor of music and TV show episodes on a purchase basis, Apple must avoid the wrath of its business partners in those ventures.
But its never-ending thirst for profits has met its match in the similar profit motives of the big media content producers, yielding a stalemate. Eddy Cue, iTunes SVP, has been unable to break the deadlock.
In July Tim Cook commented, "We continue to pull the string to see where it takes us, and we are not one to keep around projects that we don’t believe in and so there are a lot of people here that are believers in Apple TV."
Apple's attempts to court content providers on a live TV offering have been rebuffed.
[Image Source: Washington Times]
Comcast Corp. (
), according to
, rejected an invitation into Apple's would-be TV "walled garden" back in 2007 when it realized the extent of control Apple wanted over its content. Apple received similar feedback from CBS Corp. (
). And Viacom, Inc. (
) is also lukewarm on the prospect.
Walter Price, an investor in RCM Capital, a major Apple stakeholder which owns $1.9B USD shares says that in a recent meeting Apple executives said the roadblock was content providers being set in their traditional business models. The content providers are reportedly afraid of putting Apple in the driver's seat. This is not surprising; many content makers long ago grew frustrated at Apple's rigid iTunes pricing rule, and
helping the media market rise to its current dominant position.
If Apple can't cut a deal with content providers, it's next best bet is to try to approach the middle man -- the networks that distribute them. According to
, its strongest hope lies with AT&T, Inc. (
). AT&T is a fresh face on the broadband scene and is looking to
rapidly expand its Uverse cable network
to challenge Comcast and Time Warner Cable's offerings. Plus AT&T already enjoyed a
successful union with Apple
, during the period of iPhone exclusivity.
But as much hope as there is for a deal with AT&T,
is bearish on that deal arriving this year.
This article is over a month old, voting and posting comments is disabled
RE: do people really care about Hard Drives on these things?
9/7/2012 11:56:04 AM
I have plenty fast internet and would still prefer to download it rather than stream.
Even the slightest hiccup in the pipeline can stall your download. Try explaining that to the family on movie night why things are stuttering.
Not against streaming, just think its QoS is relatively unreliable.
RE: do people really care about Hard Drives on these things?
9/7/2012 2:07:51 PM
I have 7mb dsl and routinely run upto 3 streams without issue. AppleTV movie rentals download first into its 8GB cache. We recently dropped DirectTV to go to a streaming only household.
"And boy have we patented it!" -- Steve Jobs, Macworld 2007
News Corp. and Disney Plan to Yank Hulu Content, But Hope to up Subscriptions
August 20, 2012, 4:00 PM
Report: Apple to Release Set-Top Box with Live, On-Demand Content
August 17, 2012, 1:02 PM
Apple Records Q2 Revenue of $39.2B; 35.1M iPhones, 11.8M iPads Sold
April 24, 2012, 4:30 PM
AT&T Posts Strong Earnings, iPhone Activations Drop 43% from Previous Quarter
April 24, 2012, 1:18 PM
Report: Prepare for Apple Television Product
December 20, 2011, 11:05 AM
Quick Note: QNAP Announces $129 QGenie 7-in-1 NAS for Mobile Users
July 14, 2014, 9:32 AM
Apple Launches 21.5” iMac with 1.4GHz Core i5 Processor Priced at $1,099
June 18, 2014, 8:07 AM
Lowe's "Holoroom" Brings Holodeck, Home Improvement Dreams Closer to Reality
June 13, 2014, 9:06 AM
Intel to Broaden Market for Fanless Tablets, Ultrabooks with 14nm Intel Core M
June 3, 2014, 10:42 AM
ZOTAC Announces Four New Silent ZBOX Mini-PCs
June 2, 2014, 9:21 AM
ZOTAC Announces Funky ZBOX Sphere OI520 Series
May 22, 2014, 8:20 PM
Most Popular Articles
Lumia 830 Gets Major Upgrades Including New 20.1 Megapixel Toshiba Sensor
August 15, 2014, 6:00 PM
Windows Phone, BlackBerry Smartphone Market Share Falls to 2.5%, 0.5% Respectively
August 15, 2014, 9:44 AM
GM Concedes That the Cadillac ELR Doesn’t Really Compete with the Tesla Model S
August 15, 2014, 5:42 PM
Report: Windows 9 “Threshold” Tech Preview Coming Next Month
August 15, 2014, 11:29 AM
Apple Scores Patents, Preps New Reversible USB Plug for iPhone 6 Connector
August 18, 2014, 1:32 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information