Mike Becky

Tag Archive for ‘Chris Dixon’

Apple’s TV Set

Marco Arment really got the ball rolling when he published his thoughts on an Apple HDTV. MG Siegler, Chris Dixon, and Neven Mrgan have all written responses to Marco’s initial piece about the topic.

MG Siegler points out that many of Marco’s arguments for Apple not entering the television market are also good reasons to enter it. The television industry could use some sort of iPhone-like change that would force manufacturers to build better products that offer a drastically improved user experience. And Siegler thinks Apple is the right company to do it.

There is just so much potential here and no one is doing anything with it. TiVo tried, but they just didn’t have the firepower. Apple does.

All of Sielger’s arguments seem quite convincing, but I just can’t get past this point:

As for the warehouse argument, Apple already makes a ton of 27” iMacs. These would be considered pretty big TVs just a decade ago. To compete now, they’d likely have to do 40” or 50” models. But they’re really not that far away from it.

The biggest problem I see with an Apple HDTV is having enough space in the back room of their retail stores. Yes, Apple sells a lot of 27-inch iMacs, but those iMacs are sitting in warehouses and stock rooms in place of the 24-inch iMacs that preceded it. These theoretical HDTVs are brand new products that would need to take up new room in retail stock rooms. Not only would every single Apple retail store need to have room to stock enough HDTVs to sell for a week or so, they will need this room in addition to all of the space that their existing products already take up. These are physical limitations that may require some of their smaller retail stores to relocate or rent out new space for additional stock.

Chris Dixon’s response takes a look at analyst’s reactions to the iPhone when it was announced in 2007. They seem a bit silly today because none of their arguments seem to have mattered in the long run. But, none of them seemed outlandish when they were published four years ago. If Dixon’s piece convinces you of anything, it’s that Apple won’t let the current market condition dictate their decision making — if Apple entered the market, it would change.

Neven’s piece mentions the possibility that users just don’t want a more computer-like television experience:

Everyone wanted a pocket computer. But I’m not sure everyone wants a living-room computer. That has been attempted before, quite awfully so; perhaps Apple can do it better. But perhaps they can’t, because perhaps people don’t really want it that much.

A valid argument. And one that supports the idea that Apple isn’t going to enter the television market, at least not yet.

Neither Chris Dixon or Neven Mrgan mentioned the physical limitation of retail stock rooms in their responses to Marco’s piece. But, I think this is the biggest problem. Sure, they could convince millions of users to upgrade their televisions more regularly. They’ve done it with nearly every other product they’ve released. And, they could probably make deals with cable companies (if necessary, although I’m not convinced that it is) to ensure that they don’t attempt to block or slow down internet traffic coming to or from Apple’s televisions. But, this doesn’t solve the stock room and warehouse problem.

I do believe Apple will enter the television market at some point, but not yet. Apple didn’t just jump into the cell phone market head first, they tested the water with the Motorola ROKR first. And I think we’ll see a similar strategy here. I expect Apple will spend a couple of years licensing AirPlay to television manufacturers before they jump into the market themselves.