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The Apple TV, shown here at Macworld 2007, has not been warmly received by the consumer electronics market.  (Source: Apple)
Steve Jobs refuses to shed tears about lack of interest in the device, saying its just a "hobby"

Apple seems to have a Midas touch when it comes to electronics.  Despite its failings during the mid 1990s when it lost the home computer market to the PC, in recent years it has grown into what seems an unstoppable juggernaut, adding runaway commercial successes in the form of its various iPod lines and now its new iPhones.  Even its computer and OS sales have been doing far better lately.

However, recent reports indicate that there may be one ugly duckling in the Apple family of commercial successes.  That product is the Apple TV.

The Apple TV seems like a good idea on paper.  People have lots of media on their computer -- movies, TV shows, music videos and various other multimedia items.  What if they could transport that media easily onto your home TV?  From that idyllic idea evolved the Apple TV, which provides users with a portal to transport your content to the tube.

What seemed a wonderful idea quickly became perhaps Apple's biggest hardware blunder of late.

While no exact sales numbers are available for the Apple TV, which first came out in March, the new device is getting from holiday shoppers, according to analysts, the same reception the device has been getting throughout its brief history -- a bunch of static.

"That category of devices is so nonexistent," said Ross Rubin, an analyst with The NPD Group, one of America's top market research firms.

Apple has done everything it can to avoid the issue of whether the device it once promised would bring a revolution has now fallen on its face.  It will not release sales numbers for the Apple TV units, like it does for its other major products.  It will only release subscription reports, which will include Apple TV sales numbers, every two years.  Steve Jobs even downplayed it at the D: All Things Digital conference, saying it was just a "hobby".

So why has Apple TV, once boldly hailed by Apple, fallen from grace in the eyes of the consumer?

Much of the problems seem to stem from a combination of a small market segment and simple consumer ignorance.  To start, only a certain percentage of users have enough computer content to warrant such a device.

"Video drives the television experience, and while the PC has become the hub for photos and music, they haven't become great storehouses of commercial video," NPD's Rubin said.

And according to another market researcher, Joyce Putscher, an analyst with In-Stat, even customers who have this content are typically unaware that the device exists or are ignorant to how it works.

The other major factor that has led to the device floundering is Apple's insistence on keeping it proprietary.  The device is currently only compatible with free video from YouTube and paid video from iTunes, further cutting down its market base.  By doing this, Apple increased its control over the device as the expense of sales.  With TV studios bringing a wealth of content online, for the first time, Apple's device locks its users out of experiencing these new sources of media.

Users have hacked the device to run Mac OX and interface more openly, but many users are not savvy enough or do not wish to waste the time on exploring such an option.

Another key problem is Apple's refusal to develop a rental or subscription based program to use with the device, perhaps through the iTunes interface.  Steve Jobs ardently has voiced opposition to such ideas, saying the consumer doesn't want them.  But analysts think that part of the device’s failings is due to the fact that customers are used to being able to rent or subscribe to services, instead of having only the option to buy from one restricted source. 

Options and multi-functionality are what drives the high tech consumer, but the Apple TV remains sadly closed and one-dimensional.  For this reason, despite Apple's wild success in other markets, analysts see the Apple TV as nothing more than how Steve Jobs sees it -- as a hobby.

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I think most people saw this coming
By ninjit on 11/26/2007 5:25:50 PM , Rating: 2
I said it before, when the first anounced the AppleTV.

For people to even consider it as a proper option, it would have to be much much cheaper (~$100).

Otherwise there are better options, including from Apple themselves:
With a Mac Mini, you get much better featured device with onboard storage, in essentially the same form factor, and it can play any media format given the right quicktime.components (or just VLC).
It even still has front-row to give you the pretty 10ft UI experience provided by the AppleTV.
And with itunes Music sharing, Video sharing, and iPhoto sharing, you still get the Mac OS network integration that the AppleTV would provide.

They really, really didn't think this one through - instead of this piece of crap, they should have come out with an even cheaper Mini (Mac Nano, maybe?).

RE: I think most people saw this coming
By Parhel on 11/26/2007 5:27:12 PM , Rating: 5
You're overthinking this. They just need to make it white.

By MGSsancho on 11/26/2007 6:00:03 PM , Rating: 2
no piano black. all my AV equipment is black. except my hd-dvr (moxi from charter)

actually brushed aluminum or piano black would be awesome and cheaper. i dont care if its closed. personally id hack it but it would sell better if its open

By Circle T on 11/26/2007 5:56:52 PM , Rating: 2
With a Mac Mini, you get much better featured device with onboard storage...

The ATV does have built-in storage. It comes in either 40 or 160 GB versions. So both the Apple TV and Mac Mini, from Apple, are available with a 160GB drive.

The funny thing is, I basically carry this thing around in my pocket. I have a new 160GB Classic, and have the new Dock with Component out. So every movie, TV show, picture, and song that I have on my iPod, can be played on my TV. So, it basically does the same stuff, minus YouTube, that the ATV does. And it fits in my pocket.

RE: I think most people saw this coming
By gradoman on 11/26/07, Rating: -1
RE: I think most people saw this coming
By ninjit on 11/27/2007 2:40:58 AM , Rating: 2
...but have you ever used VLC to play anything?...

Yes, actually I use VLC for pretty much everything (on my Mac and my PC), only 2 cases that I've found it consistently craps out on
1. Seeking within WMV files
2. and at the end of playing any MKV file, it will crash

Besides that I have no problems.

As for quicktime, install Perian (if you haven't already tried that) - extremely well made component that plays most of the common formats that QT doesn't support natively.

As for your comment about it's resource usage, I have a really old 500Mhz Athlon that I liked to tinker with, and on that WMP can't play any HD content, whereas VLC can with no stuttering.

Maybe your troubles are indicators of other inadequacies?

By gradoman on 11/27/2007 4:44:36 PM , Rating: 1
I'm talking about OS X, not Windows. Gee. Read before commenting or rating me downward. Since, hey I use CCCP, not VLC on Windows and yeah, I can play HD content.

ON MAC, VLC is NOT great.

By tallguywithglasseson on 11/27/2007 12:42:21 AM , Rating: 3
What I've said since the AppleTV came out is for people to consider it, it should actually do what it sounds like it does - TV. Not just display some of what your computer does on your TV set, but over-the-air, cable, satellite, whatever you have, pause live TV and rewind - a DVR basically, plus the other features.

Hell, they could charge $200 - $400 more and compete with the TiVo series 3, and charge people a subscription just to update programming guides. I'd consider buying one, when pricing out parts to build a custom media center PC with 2 capture cards I get to around $500, without silent PSU and silent CPU cooling and before even adding the OS!

With a nice looking, silent, small box (it would be a little bigger with 2 hardware encoders), I'd even pay extra not just for the convenience, but for the "nice looking appliance that belongs on my entertainment center" factor.

But since it's not a DVR, something that plays music through my TV does not appeal to me as a consumer. Something that plays YouTube through my TV doesn't do it, nor does something that shows my photos on my TV, nor does something that makes me go out and buy TV shows to watch on my TV that I could get for free.

I'm not sure what market Apple is envisioning for the current iteration of AppleTV, maybe Jobs really does think it's just a hobby.

"I modded down, down, down, and the flames went higher." -- Sven Olsen
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