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
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.