Piper Jaffray Forecasts Apple Planning ‘Connected Television’, Skeptics DisagreeFeb 5th, 2009 | By Elisabeth Lewin | Category: Digital Movie Store, Digital Video Recorder, Internet TV, Video
Apple has consistently denied interest in such markets, however.
“We expect Apple to design a connected television over the next two years (launching in 2011) with DVR functionality built in,”Piper Jaffray analyst Gene Munster wrote in a lengthy research report released earlier on Thursday. “These recorded shows could then sync with Macs, iPhones and iPods over a wireless network.”
Munster posits that a “connected television” device would further cement Apple’s position in the digital living room, by making available interactive TV, music, movie, and gaming features in one piece of hardware. Apple could also develop a television set that stands out from the competition, making use of its iTunes Music Store.
“Apple could effectively replace the home entertainment system (including a music stereo, cable box, Blu-ray/DVD player, and gaming console) with an all-in-one Apple television,” Munster wrote. Apple could distinguish itself among TV makers with software that makes setup of complicated home entertainment devices as simple as using its existing Apple TV product.
The analyst sees the company setting the stage for introducing these kind of new living room entertainment products, by year’s end, with a new version of its Apple TV set-top-box that will include DVR software for recording live television.
Although Apple maintains that Apple TV is still one of its hobbies, rather than a core product, Munster estimates the company will sell 6.6 million of the devices during the current calendar year, up from an estimated 2.1 million units last year.
Apple’s self-characterization of AppleTV as a “hobby” is borne out in reality. Apple 2.0′s Phillip Elmer-DeWitt characterizes the device as a laggard in the field, saying “Although sales of the device tripled last quarter, thanks largely to movie rentals, it is still a minor player in the transition from the old distribution paradigms to the new.”
This contradicts Piper Jaffray’s Munster. He gives a more optimistic spin looking at the same sales numbers, extrapolating “throughout calendar 2009, [indicating] Apple TV units of over 6 million [sales] in calendar 2009.”
The report, while founded in concrete knowledge of Apple earnings calls, DVR and TV patent filings, agreements with LCD manufacturer LG Electronics, and the large and growing customer base of iTUnes users and Apple TV owners, is largely an optimistic forecast “based on conjecture,” as Apple Insider puts it.
Daniel Eran Dilger, in a story at Roughly Drafted Magazine, analyzes these possible new additions to Apple’s television offerings, and says that they are awful ideas, taking AppleTv and “converting it from a fun hobby into a burdensome money pit failure.”
His suggestions for more “sensible” additions to the next upgrade of Apple TV would include iTunes radio features, “alternative” content (like podcasts), HDTV mini-games, and more support for user-generated content. His idea to launch an Apple TV SDK, “a way for third parties to build modules that run on the device”, is especially tantalizing.
What do you think the advancements for the Apple TV (or other Apple television-content-consuming device?)? Will Apple TV remain a “hobby,” or will it step into the competitive TV fray?