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Five Ways Steve Jobs Can Turn On Apple TV Sales

Apple TV
Daniel Eran Dilger
Apple hasn’t done a lot to push sales of Apple TV apart from lining up HD movie rentals and sales and adding incremental feature advances included in the new Take Two software. The problem, as noted in the previous article, is that buyers are somewhat hesitant to shell out $229 for box that primarily rents movies. Of course, Apple TV does a lot of other things too, such as photo viewing, AirTunes audio streaming, YouTube, and podcasts. However, none of those things compare to five killer applications Apple could quite easily add to the box, turning it into a hot seller and subsequently driving iTunes media sales and rentals. Here’s what they are.


Three Barriers Holding Up Apple TV

1. Add a Multitouch WiFi Remote: the iPod Touch/iPhone.
Ever since Steve Wozniak left Apple to create his CORE universal programmable remote control, home theater components have been getting increasingly fancier remotes. Microsoft’s latest Media Center remote control sports a ridiculous number of buttons, and some third party replacements for it (which sell for $200) incorporate a small display so users can be guided through the astronomical complexity of menus without having to squint at the text on their TV display.

Apple TV has a tiny white remote, the same one that’s bundled with most new Macs and costs $29 to replace (and perhaps $2.50 to build). However, Apple has also developed what could easily be the most sophisticated remote control on the planet: the iPhone and iPod touch. Now all it needs to do is create a background listener for Apple TV that allows users to manage the box directly from their WiFi handheld.

There’s no need for that rumored Bluetooth full sized keyboard sporting a multitouch trackpad; Apple TV doesn’t even have Bluetooth, so adding a $100 keyboard would also require plugging in a Bluetooth dongle. Most Apple TV users likely already have an iPhone or iPod touch however, and those that don’t would certainly get one if they could use it to remotely control their Apple TV from anywhere within WiFi range. Remote control features would be done in software, making it a virtually cost-free enhancement for Apple TV.

Most remote controls use IR (as Apple’s basic one does) to save on costs. Higher end models use UHF radio signals to work through walls, particularly in the case of older satellite receivers that might have needed to be located in another room. The iPhone already uses WiFi, which doesn’t need to be pointed at a receiver as IR does; it also doesn’t require any special setup, as Apple TV already uses WiFi for networking. Creating a standalone remote control with the features of the iPhone would be prohibitively expensive, but adding remote control features to the existing iPhone hardware would be cheap and trivial.

Adding a remote module for the iPhone and iPod touch would make it easy to add additional sophistication to the Apple TV menus, such as making it simple for users to arrange custom menus that reflect how they use their device, whether primarily for their own home videos, for movie rentals, for podcast content, or for photos.

It would also make the device an excellent home audio system, allowing iPhone users to change the volume and select music tracks from their handheld mobile screen rather than doing so from an iTunes computer running AirTunes or Apple TV itself. It could also convert Apple TV into the core of a home automation system, or be tied into home security systems as I described earlier under the concept name of Bonjour Ready.

  • Work required: minimal WiFi listening software on Apple TV, plus a basic iPhone app.
  • Value to users: a phenomenal killer app, unlocking lots of potential value for users while being difficult for competitors to duplicate at a reasonable cost.
  • Likelihood of happening: this is so simple and obvious that its hard to imagine why Jobs hasn’t released it yet.

Ten Big Predictions for Apple in 2008

2. Send Apple TV on Safari.
Now that Apple TV has a powerful handheld remote control input system, the most obvious new thing Apple TV would need next is an HDTV version of the Safari web browser. Ever since Web TV, various groups have worked to develop a web browser box that works directly with a TV rather than requiring a full PC. The problem has historically been that high resolution graphics and small text look terrible on standard definition TVs, and alternative browsers did a poor job of rendering pages designed for PC screens (or Internet Explorer).

HDTVs still don’t match the sharpness of most computer displays, but are quite adequate for presenting web pages. Apple TV has the power to present web pages and already requires a decent Internet connection, so adding web browsing to the living room makes a lot of sense. Apple has a huge leg up on competing web TV systems from the Wii to the Playstation 3 because the Safari browser already works well with most web pages; the Opera and Netfront browsers used on those game consoles offer a less attractive and less compatible experience.

Apple would need to simplify a few things about the browsing interface, but it already has a lot of experience in doing that for the iPhone. In fact, by simply porting the Mobile Safari version to Apple TV, it could use the handheld multitouch interface of the iPhone to directly manipulate web page views displayed on TV, making it very intuitive to use the web on a larger screen. Essentially, the iPhone would simply send the user’s inputs to Apple TV, which would then render a larger scale version of the web pages on the user’s HDTV.

This would result in an intuitive multitouch web browsing experience similar to what Microsoft has been trying to present with the $10,000 Surface bathtub and in Windows 7 vaporware, albeit with a far more sensible and compact input system rather than a bunch of projectors, mirrors, or digitizers that will result in repetitive stress strain as users reach out to touch the screen, and subsequently end up with a perpetually dirty display. Everyone already knows how to wipe the iPhone’s screen clean.

By presenting the first web on TV product that actually works, Apple could sell craploads of Apple TV units paired with iPhones or iPod touch devices. That would also cement Apple’s plans to force the web back to open standards, nailing dead Adobe Flash, Microsoft’s Silverlight, and any other proprietary web add ons across another major market. Apple already owns the mobile web; by adding the living room web, it could decisively remove various forms of pollution from the web and instead encourage SVG, HTML5, and similar efforts to keep the web open.

  • Work required: a customized Mobile Safari version and an iPhone app for controlling it.
  • Value to users: a phenomenal killer app for selling Apple TV, difficult for competitors to duplicate at a reasonable cost.
  • Likelihood of happening: this is so simple and obvious that its hard to imagine why Jobs hasn’t released it yet.

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3. Add Casual Gaming and an SDK for Interactive Apps.
Once you have a home web viewer, why not offer some other apps to go along with it? Because Apple TV is just a stripped down version of Mac OS X, developing custom application modules for it would be similar to creating iPhone apps or basic Mac apps. A new set of interface guidelines that bridge the gap between the iPhone’s handheld screen and the conventional Mac desktop is needed, one customized for use with a ten foot display.

However, Apple TV would make an excellent platform for casual gaming and basic web enabled interactive applications, particularly when paired with iPhone or iPod touch units acting as WiFi remote controllers with accelerometers controls and multitouch screen displays. It would also make a great presentation kiosk system, allowing users to control a video presentation or Keynote slides from a slick WiFi remote displaying the next slide or offering other options and features on the handheld’s screen.

By embracing Apple TV as a development platform, Apple could sell lots of additional boxes, creating a huge installed base that could not only sell a new section of apps and games from iTunes in the same model as the iPhone, but also generate a large volume of new media sales and rentals, a primary intent of Apple TV in the first place. Such a move would also extend Apple’s Cocoa development tools to a broader audience outside of the Mac and iPhone markets.

  • Work required: a customized SDK and HIG for Apple TV, already in use internally at Apple.
  • Value to users: a phenomenal killer app for creating killer apps, difficult for competitors to duplicate at a reasonable cost.
  • Likelihood of happening: this is so simple and obvious that its hard to imagine why Jobs hasn’t released it yet.

Five Ways Apple Will Change TV: 4 Interactive Content

4. Remote Disc / MacBook Air DVD Playback.

Apple has already developed wireless DVD sharing for the MacBook Air; unfortunately that doesn’t work for remote playback of DVD movies. But the company also ships a slim USB DVD drive for the Air that would make a decent add on for Apple TV, and make the unit a one stop shop for users who have DVD collections or use DVD rental services such as Netflix. Apple TV is designed to replace the DVD, but an option for backwards compatibility with DVDs would make it a better gateway device for existing users.

Transcoding DVDs into QuickTime files is currently such a lengthy and complex task that simply playing DVDs as-is seems to make more sense than trying to help users convert their collections. The studios are also opposed to DVD ripping software, as even if Apple created a rip that were tied to the user’s iTunes account using FairPlay, it would still result in the potential for huge libraries of DVDs to be dumped on the second hand market as users ripped their discs and then resold them. Rather than pursing DVD conversion, Apple should just offer a DVD playback option.

Since acquiring DVD Studio Pro and developing iDVD several years ago, Jobs has progressively downplayed DVD authoring in favor of Internet distribution, both in home movies with the .Mac Web Gallery and in commercial movies in the iTunes Store. The latest iDVD barely got a mention in last year’s new iLife 08 release. Still, many consumers have DVDs and want to watch them, so adding that capacity to Apple TV would help bridge the present with the future Apple envisions for digital distribution.

  • Work required: Port DVD Player to Apple TV, and use the existing MacBook Air’s external DVD player driver.
  • Value to users: makes Apple TV a better stepping stone from DVD to online iTunes media.
  • Likelihood of happening: seems like a simple and obvious option Apple should offer, but will it ever?

Apple TV: Using DVDs and other Video Sources

Apple TV: Using DVDs and other Video Sources

5. License Netflix Subscriptions or Partner with a Rival Service.
Netflix is scrambling to shore up its subscription DVD mailing business with an online Watch Instantly service. The online movies have only been viewable from a Windows PC running Internet Explorer and Microsoft’s Windows Media DRM. However, Netflix has recently partnered with hardware maker Roku to sell a simple player box that allows users to stream and view a wide variety of older titles directly to their TV as part of their standard Netflix subscription. The company is also apparently working with other hardware manufacturers. Apple should partner with Netflix to complement the titles it offers in iTunes. If not Netflix, Apple could partner with Blockbuster’s struggling online service plans or even develop its own streaming service, but Netflix would appear to be the best potential partner.

It might seem like Pepsi selling Coke, but an Apple partnership with Netflix would actually make a lot of sense, as the two services are more complementary than overlapping. Apple TV currently bests Netflix in offering more new titles and higher quality HD movies. However, iTunes’ pay per view pricing might scare away some users who want to be able to watch a variety of content for less. Adding Netflix’s wide range of Watch Instantly titles at a fixed subscription price would make Apple TV more attractive to a broader audience, including the millions of Netflix users who would pay a premium for Apple TV’s hard drive catching capacity and its other PC integration features lacking in a device like Roku’s inexpensive playback box.

While Watch Instantly titles on Apple TV would send revenue to Netflix that might otherwise go to buying or renting iTunes titles, Apple’s profit margins are fairly minor on movie rentals and purchases. The company already promotes YouTube and Podcast content, both of which are served up at no profit to Apple. Some have even reported that iTunes is actually selling movie titles at a net loss. Apple offers iTunes content primarily to add value to the iPod, iPhone, and Mac in ensuring that commercial content for them is available, not to derive big profits from individual media sales. Offsetting any lost sales, Apple could earn commissions from selling Netflix subscriptions to its Apple TV users.

By bringing Netflix’s streaming titles to Apple TV (and by extension, the Mac platform), Apple could kill two birds with one stone: expand the utility and audience of Apple TV while likely also convincing Netflix to adopt the standard H.264 codec over its existing use of Microsoft’s VC-1 codec and Windows Media DRM, just as Apple did with Google in migrating its YouTube service from Flash Video to H.264. That would further curtail Microsoft’s efforts to push DRM tied to Internet Explorer and Windows, while enabling Netflix to sell its subscription based services to a wider market.

Such a migration to H.264 would also make it possible to stream Netflix’s Watch Instantly titles to the iPhone and iPod touch. Additionally, by selling Apple TV units to Netflix users, Apple could then offer to sell its iTunes music, music videos, and HD movies to a wider living room audience, all while avoiding the complication of offering both individual purchases and subscription-based services itself.

In my original exploration of how Apple could deliver movie rentals, I described a model patterned after Netflix; partnering with Netflix instead would expand Apple’s audience while also offering a clear differentiation between iTunes’ rentals and sale and Netflix’s subscription model, allowing Apple to hedge its bets and serve different customers with unique needs.

• Work required: develop a Netflix player module Apple TV, sell Netflix on serving H.264 content.
• Value to users: expands the potential audience for Apple TV and broadens the content available.
• Likelihood of happening: win-win for both Apple and Netflix, allowing consumers to choose.

How Apple Could Deliver Workable iTunes Rentals

Five Times Better.
With a sophisticated remote control, web surfing, a slick custom app and games development platform, DVD playback, and support for Netflix’s Watch Instantly titles, Apple TV would be far more valuable at a minimal additional cost in development efforts. Apple TV could subsequently become a very valuable home media computer without eating into Mac sales. Apple could also market the system as a low cost alternative to buying a PC just to browse the web and play back media.

Previous attempts to create an web appliance, from WebTV to Sony’s BeOS-based eVilla to 3Com’s Palm OS Audrey web appliance to Bandai’s Pippin games console based on the Classic Mac OS, have typically suffered from boxes stripped down too far to be useful. Apple TV can already do far more than those devices offered, while also offering a wide open potential in third party apps. The best part is that most of the work needed to deliver these features is either already done or fairly simple to deliver.

The Unrealized Potential of Apple’s Hybrid Platform: Mac, iPod, iPhone, and TV


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55 comments

1 OlivierL { 06.02.08 at 5:00 am }

So, 3 of those 5 ways are relying on the pairing of a Touch platform device to the ATV for advanced input and control.

2 OlivierL { 06.02.08 at 5:31 am }

I would really appreaciate #1. This could even trigger a purchase of an ATV to pair with my Touch.

For #2, I’m a bit more circumspect. If you already own a Touch/iPhone, casual browsing in your living room is already pretty efficient. On a TV, event if the display has an higher resolution, you’d better have perfect vision to read tiny text on the set so you might end up displaying the same amount of information as on the smaller display of your Touch. And TV is for sharing something with multiple person : pictures, music, movies. The ATV already provides optimized viewers for such content, even for online content (flicker, Youtube, …). Casual browsing isn’t something you really share with your friends.

3 OlivierL { 06.02.08 at 5:37 am }

For #3, I think this is a bit to early : Apple is about to launch its Touch platform. Adding a new one will make some noise. Moreover, the Touch platform, as a mobile one, can easily be identified while the “TV device” platform is too blurry to easily be launched in a focused way. Maybe starting with webapps included with #2, like with the iPhone, will be able to trigger a new platform but I don’t see this as a killer feature. The Touch platform make sense because this is a mobile one. At home, I think people will demand more from it and it won’t be able to compete against the laptop. And again, a TV set isn’t the best to look at text.

4 PerGrenerfors { 06.02.08 at 5:38 am }

I think suggestions 1-4 seem like great ways to improve TV. The fifth, however, doesn’t make a lot of sense in markets outside the US. And really, it does sound like Pepsi selling Coke. I can’t see why Apple should put Netflix on TV when they worked so hard to establish iTunes as a way to get content.

5 OlivierL { 06.02.08 at 5:42 am }

For #4, I think that the simplest is the best. Standalone DVD players are really cheap, reliable and efficient. The PS3 is one of the best and cheapest BluRay player. But it lacks the simple “load’n'play” efficiency a dedicaded player provides. I know that Apple managed to fit both a powerful general purpose device AND an still sleak and efficient iPod into the Touch, but I won’t like navigating to many menus in an ATV just to play a DVD. KISS : keep it simple stupid.

6 OlivierL { 06.02.08 at 5:44 am }

For #5, content is the key and I think that Apple should try to do wha ever it need to do to get content on its platform … as long as it does not alter what makes an Apple product. And with content owners, not losing your soul is a hard job.

7 elppa { 06.02.08 at 6:58 am }

[1]
- What happens if you don’t have an iPod touch / iPhone? What comes in the box?

- Not everyone wants a complex remote. Simplicity is sometimes best. What happens when the Kids want to watch TV, do Mum and Dad hand over their expensive iPhones? I think they would be happier for their children to have the current plastic remote.

- That said, the remote could be improved. Apple could introduce an aluminium remote with the iPod scroll wheel, similar in appearance to the nano, but without the screen and slightly different proportions. They can then bundle this with their computers, as it would better match the look and feel.

- No one buys an electronic device on the strength of the remote control, no matter how great.

[2]
- SafariHD (which was later renamed at the behest of Apple legal) tried to solve this. I’m just not convinced people want to surf the web on the TV.

I think TV needs time to develop and regular improvements. I don’t think there are any quick fixes. These ideas may help spur sells in the short term, but I can’t see these steps making TV a must have for most peoples living rooms.

8 Berend Schotanus { 06.02.08 at 8:00 am }

Well, this looks very much like an open application to become Apple TV innovation manager (mind you, Steve Jobs is infamous for being hard with his staff!). These ideas are not bad at all.

I think behind the Apple TV product concepts lies the fundamental issue of coach potato behavior. The basic concept Jobs seems to aim for in my eyes is an interface that really works when you are a passive TV consumer sitting on your coach. An extremely simple remote might be part of that concept, favouring YouTube over general web access as well.
Apple products are so good because they target for people in very specific situation rather than overloading them with what is technically possible. What is it you really need when sitting on your coach?

9 dallasmay { 06.02.08 at 8:01 am }

Another option that might appease the Television co’s more is adding a way to show commercials.

Let NBC and the gang podcast their shows with commercials if they distribute them for free. If viewers want them without commercials they will have to pay the $2 fee. I for one would rather have commercials than pay $2. In fact, my wife and I have been watching LOST all season through ABC’s website in HD on my computer. It’s really pretty good.

Add an easy way to get free television and I’ll buy one.

10 Galley { 06.02.08 at 8:23 am }

I suspect the jerks at the movie studios are the ones preventing Apple from streaming DVDs on a Mac to tv.

11 Tim Wouters { 06.02.08 at 9:21 am }

How about they turn Apple TV into an actual TV? I mean, if one company can eliminate the wire spaghetti and hardware clutter that currently pollutes our living rooms, it’s Apple, yes?

Imagine a Full HD display, integrated Blu-Ray/DVD drive, desktop grade hard drive and CPU, WiFi, and of course all the necessary tuners. Oh, and surround audio hardware as an accessory.

Combine that on the software side with a real operating system, a real Internet browser, Apple TV’s current media syncing features, and you’ve got yourself a one-wire, home theater power horse that boasts Apple’s design savvy as a bonus. Possibly at a price point that competes with having to buy everything separately.

The killer product is not yet another box. It’s one box that does everything out of the box.

12 L { 06.02.08 at 10:45 am }

Partnering with NetFlix would just add a middle man. Apple works directly with the studios, like NetFlix does. It’s just studios like the failing NetFlix model and MS DRM.

The iFund did choose home automation, so iPhone/Touch as remote just might happen. However, web and mail on the TV I doubt.

USB DVD on the AppleTV is more likely that DVD over WiFi. Adding MPEG-2 playback on AppleTV would avoid the transcoding problem. I’d like that, since I’m accumulating much AV content in MPEG-2 with a TV tuner. MPEG-2 playback is an app I’d buy for an iPhone/iPod, and would make AppleTV more useful for me. Kaleidescape had to battle it out in the courts, so I doubt Apple want to add that front to it’s battles.

Classic arcade games on the AppleTV might get a few sells.

Web appliances certainly did too little. That’s why the Folio failed. The advantage of programmable platforms like Palm OS and iPhone 2.0 is they are versitle.

13 hdasmith { 06.02.08 at 11:34 am }

In Britain, at least, TV browsing was started by Sky and Cable providers for people that didn’t have computers. As most people with an AppleTV, and everyone with an iPhone and iPod Touch will have a computer I don’t see the point.

The problem with the TV internet browsers I have seen and used is not with viewing the page, but more with the clumsy interfaces, and without a keyboard or mouse, it’s not going to get better.

I therefore can’t see the benefit of having a version of Safari on the AppleTV. What it really lacks for me is content, and in Britain, there isn’t really ANY as we don’t have movie sales or rentals on iTunes.

14 LD { 06.02.08 at 12:07 pm }

I have an AppleTV and love the potential of it but don’t really love the current incarnation. The above ideas are excellent.

I think one thing that would go a long way to turn on sales would be an SDK for third parties, similar to the iPhone. A large portion of the above could be developed by eager third parties. In fact, there is Safari for AppleTV already for example.

Teaming the iPod Touch/iPhone with AppleTV seems like a no-brainer for sure. Why Apple hasn’t done this yes is confusing. I think it could drive sales of both (not like iPhone needs any help). If I could distribute several AppleTVs throughout my house and control them using only the iPod it would be a killer. Combine that with universal remote control using an IR blaster on the USB port and you have the best remote for the money period.

A HUGE benefit would be addition of Flash support. Combine that with a Hulu interface and we are off and running! That’s all I want right now. I’ve even offered to pay $50 (hoping others will join in) to someone who could develop that for me through a hack. Though the teeny CPU may not be able to playback Flash smoothly.

15 dicklacara { 06.02.08 at 12:19 pm }

Dan,

#1 is right on and it makes everything else happen. Ever since SJ showed the iPhone, a URC (Universal Remote Control) seemed to be a natural killer app. After buying an iPhone (day 1), I feel even stronger about this capability.

Apple could even build an inexpensive WiFi device that broadcasts IR to devices that only recognize IR codes. Then the MultiTouch URC could control all your components (TV, VCR, Audio, Wii, etc.) as well as the AppleTV component.

As to surfing the web on HDTV. I have a Mini (with EyeTV) attached to my 46″ HDTV (1440 x 900). Text and web browsing are surprisingly good! You can use the enlarge text in many apps: Safari, Mail, etc. Also, you can use the Universal Access System Preference to enlarge/zoom the entire screen. Also, if you were using an iPhone or Touch to do the surfing, you would probably look at its display (rather than the HDTV) to do the actual surfing– then review the results on the HDTV. In any case, it would seem rather easy to replicate the MultiTouch pinch, flick, etc. on the HDTV screen via AppleTV.

@dallasmay

Your idea about allowing free TV shows (with commercials) as Podcasts is brilliant! The infrastructure to support this is already in place in the iTMS to locate/sort/etc. these “shows”. Then, they can be streamed directly from the Podcast host site (not the iTunes servers) at no cost in bandwidth to Apple.

16 L { 06.02.08 at 12:43 pm }

No, not Flash! YouTube is available on the iPhone and the iPhone doesn’t support Flash. Hulu uses Flash for video and interface features that can be done in AJAX.

17 Dlux { 06.02.08 at 12:55 pm }

I’m one of the people who suggested that Apple partner with (or outright buy) Netflix over at AppleInsider. The synergy would indeed work both ways. Netflix is not in the business of building hardware (hence the ROKU deal, and possibly more in the future), and Apple is only partially in the business of providing first-run content.

Apple’s rental scheme is not an all-you-can-eat deal like Netflix, but it allows for casual one-shot rentals without any sort of monthly commitment. So in this regard a partnership would be complementary, and Apple can offer Netflix customers a way to access the streaming viewing option that they have already paid for but aren’t getting unless they run a Windows box. So in that regard Netflix viewing would simply be another choice in the Source setup, and Apple can still offer the one-shot rentals themselves.

The biggest variable in all this is the contracts that the studios are willing to enter into. They’re more hesitant these days with Apple, due to the total success of the iTunes store, and we all know that the major media owners want as much control over their assets as is legally possible (and then some). Netflix may have been able to get a more favorable streaming deal at this point than Apple ever would, even if they offered the exact same service. So perhaps it’s better for Apple to piggyback off of Netflix’ arrangement than attempt to cut their own.

(This asymmetry of contract provisions has its precedents; Apple was able to get better deals on flash memory early on because of volume, and the fact that no one else had the foresight to buy it all up themselves. Now third parties justifiably hire the big lawyers if they intend to do business with Apple.)

Logistically, Apple could benefit from Netflix’ huge inventory of DVDs. I used to work for a music company that had to buy one of every available CD. This is by no means a trivial task, and simply acquiring, shipping, cataloging, and storing that many discs is a considerable task, never mind the ripping and re-encoding. If Apple worked directly with Netflix, they’d have ready access to an already assembled and fully automated library. Other than Blockbuster (who, btw, suck so much that I doubt Apple would even consider associating with them), no one else other than Amazon could offer such a library. Apple is probably part-way there themselves, since they are already in the rental business, but I doubt they have anything close to the number of obscure titles as Netflix.

The article lists five ideas that could boost sales for AppleTV, but leaves out one obvious market that would make it the must-have box for its customer if it provided the right combination of interface, selection, and ease of purchase: porn. C’mon – it’s not like Apple isn’t already permanently associated with original sin…

18 dicklacara { 06.02.08 at 12:59 pm }

@L

I agree “No, not Flash!”

But, something is needed (maybe browser standards) to make web AV more controllable at run time– things like resize/pan/zoom, copy, subtitles, lyrics, chapters, etc.

19 pecos.bill { 06.02.08 at 1:06 pm }

@D.E.D.: Hah! As if the Apple remote costs $2.50 to make.
1. Is an obvious thing to do. I just hope they’ve started working on that.
2. Definitely. It needs an optional Bluetooth keyboard/trackball just in case someone wants to go nuts. (The pixel sizes would have to be scaleable to make it work for people sitting miles from their TV.) I can only see the usage being limited but still very handy to have. Currently, I do some of that with my MacBook in my lap while watching stuff that only half holds my interest.
3. I doubt the current design has enough cooling power to handle the demands that games would likely put on the hardware. Apple’s small stuff like that already runs too hot.
4. Although it sounds like a no brainer and stunningly obvious, the only advantage is for Air users. Everyone else already has a DVD player.
5. Roku’s box isn’t that cheap. It’s slightly less than half. You make a great point on the partnership but I can’t imagine NetFlix would want to cede the areas where Apple is currently better. NF wants it all and they should as they need to maintain relevancy in the future. Now, if Apple were to BUY NetFlix, that would be brilliant! That would enable Apple to subsume their customers as the online delivery model takes over. Presumably, it would also give Apple the contracts that NetFlix already has.

@TV via podcast people: Uh… Don’t hold your breath. Sending out files without DRM but with commercials would be edited to kill the commercials and plopped on BitTorrent sites instantly. This would just make it easier than what’s there now. Nobody would do that for fear of killing their DVD collection sales (I own everything from Babylon 5 and that was not cheap!).

20 pairof9s { 06.02.08 at 1:15 pm }

#1 is already in play on Macs using the Remote Buddy software. It would seem reasonable to think you could add this functionality to the Apple TV without too much more effort.

Since Apple clears little in margin on the Apple TV hardware, I doubt #5 would seem like a reasonable compromise on their part.

/

21 dicklacara { 06.02.08 at 1:29 pm }

Another potential “killer app” would require some additional “new” Apple products.

What if:

Apple made a somewhat larger MT device and a more robust AppleTV capable of multi-session/multi-threading content to the MT devices.

Let’s call it PersonalTV. Several users could be simultaneous consuming (the same or different) AV content from the AppleTV repository (Personal AV library and ITMS Library).

In a family with several kids and adults, each could be doing their “own thing” simultaneously without interfering with the others (earphones on the PersonalTV).

Dad, in the kitchen, cooking his favorite recipe from the “Two Fat Ladies”; Mom, putting together a slideshow from family photos; Sis, doing her conversational Spanish lesson, bro 1, watching “Really Bend It Like Beckham”, bro 2, watching an (uncountable) episode of “Sponge Bob”.

Then, later, they all get together to play games or watch family movies on the big screen. Mom is tired, and goes to bed & resumes that “not-for-kids” movie that she was wacthing…

22 John E { 06.02.08 at 2:54 pm }

Definitely in agreement with #1-#4 on the list. welding the existing Apple hardware suite, iTunes, and your HDTV together into a unified (and cross-platform) home/mobile media combo would be a knockout. yes i wonder too why Jobs hasn’t done this already, but he is so stubborn and gets so fixated … maybe next week …

but one big thing is still missing after that: the DVR function. i take it Jobs is fixed on internet-only, and so refuses to deal at all with CATV (no Apple equipment comes with a coaxial input jack or built in tuner). but that i think is a bad mistake, stubbornly refusing to admit CATV will continue to be a primary media source for many if not most consumers. if Apple does not directly (forget third party add-ons) integrate that source somehow into its media universe, that will only ensure most consumers will also have another non-Apple hub hardware unit that does that job.

like TiVo. i’ve wished that Apple would just buy TiVo, which it could certainly afford to do, and then ‘shove’ AppleTV inside that excellent “smart” DVR box. but i can’t see Jobs doing it.

likewise don’t see Jobs making a deal with Netflix or Blockbuster. usually he wants to ‘reinvent the wheel’ – but make it better – rather than partnering.

23 Albert { 06.02.08 at 3:15 pm }

Am I the only one who would not benefit from using the iPhone as a remote since I have 2 wireless networks setup, one n exclusive and the other b/g? Therefore my iPhone cannot interact with my AppleTV, unless of course, the upcoming iPhone would be b/g/n …

24 Ephilei { 06.02.08 at 3:46 pm }

“costs $29 to replace (and perhaps $2.50 to build)” Incredible! Daniel criticizes Apple!

25 Ephilei { 06.02.08 at 4:03 pm }

The only reasons I’d want to have the Web on a TV would be showing off pix or videos online – which ATV already via the builtin Flickr, YouTube, and .Mac support. Or possibly skimming news and blogs which could be done more simply like a dedicated RSS reader.

I think you’re spot on with the remote idea. Not that a touch remote adds much to the current interface, but the potential for third party apps becoming huge.

I agree that optional commercials, to the disdain of iTunes elites, would garner a huge audience that would feel nickel and dimed by paying for every episode.

26 benlewis { 06.02.08 at 6:21 pm }

@John E: I mostly share your sentiments. I don’t think Apple even needs to buy TiVo though, buy EyeTV instead. My $.02: PVR functionality should be on this list at #3.

27 gus2000 { 06.02.08 at 6:38 pm }

I’d take the WiFi remote one step further with “Back To My AppleTV” so that one could order a movie for download before leaving for work and have it waiting.

I’m guessing many of the Touch games would be easily ported to AppleTV (given an appropriate controller, of course). Casual gaming sells the hell out of the Wii, and it would work for Apple, too.

Oh, and if you can’t read the text on your set, go buy an HDTV. They’re just as sharp as a monitor pixel-for-pixel, they’re just blown up 10x. Sit back far enough and it’ll look fine. ;-)

I’d love an Apple DVR, but 80GB is woefully inadequate. Besides, Apple has avoided being both the distributor of media AND the enabler of copying, which I assume is why the AppleTV does not support more codecs (like Divx, the favorite of internet pirates).

28 pa { 06.02.08 at 7:44 pm }

Partnering with Netflix? Is Apple not able to offer subscriptions on its own? How will Apple and Netflix handle billing, through user’s iTunes account or through another account?

Red Box at the local grocery store is a much better value proposition for the customer for a $1 per movie per day.

I like the first two. Casual gaming, (#3) is not worth the effort. If It’s gaming you want, it would be better if Apple introduced another piece of hardware to connect to Apple TV perhaps through USB that would run he games, with game purchase and storage and interface to TV handled by Apple TV itself.

The remote disk (#4) is also redundant for most people. DVD players nowadays cost as much as a couple of DVDs!

Perhaps I should mention that I own an Apple TV unit myself and am quite satisfied with it. It’s getting quite a bit of use. In fact, it is used as much as our DirecTV box. My kids often bring their friends over to watch movies purchased or rented from iTunes and soccer games recorded on eyeTV. The main reason we have DirecTV is for ESPN2, Fox soccer channel, Setanta Sports, and Gol TV.

So, for me the best improvement on Apple TV would be content. Specifically, if I could download English Premier League and Champions League games from iTunes. Of course, if Apple TV could stream these live, I would cancel our DirecTV subscription altogether.

29 John E { 06.02.08 at 8:19 pm }

@ ephilei – i’ve got both a mini with monitor and a mini with HDTV in the same room. i use the normal computer monitor for all personal browsing, reading, and anything detailed. but i also use the TV for ‘social browsing’ a lot – with my wife and friends – looking at lots of stuff on the web to buy or talk about together. and also of course for viewing all media sites, like Hulu. so adding Safari to AppleTV would definitely be a plus (you can hack it now), but you must be able to use a keyboard somehow too for real convenience, which the iPhone/Touch would neatly solve.

@benlewis – i tried EyeTV. but it can only tune a limited number of CATV clearQAM channels, not all the other good ones that require a cable card/box. and most consumers don’t want to fiddle with more dongles. TiVo does a great job of tuning and DVR’ing everything (plus stuff i don’t need like UnBox) and feeds it all back to my mac via Toast perfectly. but it ain’t cheap.

maybe Jobs is avoiding the DVR function for Mac hardware because of the tricky DRM issues that would come with it (the new Toast 9 has those DRM file conversion restrictions built into it … but it is easy to crack the files).

30 stefn { 06.03.08 at 12:37 am }

Yes, Apple TVs. Real TV sets. Then, as Daniel suggests, Apple can integrate sets and puters. It’s a great way to move OSX onto a huge sector of gizmos and into living rooms. Be Sony and Windows all at once.

31 dicklacara { 06.03.08 at 1:19 am }

@stefn

I agree that from a technical and UI standpoint it would be great to have Apple TV sets (and other home theater components).

However, these are big-ticket, low-profit-margin items. They would not provide Apple the return they are accustomed to.

Even as a loss-leader or break-even it is still a bad proposition because it would tie up capital, warehouse and retail floor space, not even mentioning the lack of a distribution channel.

However, what Apple could do is develop a killer intelligent interface (including monitor and control) for AV components, On the component side this would include inexpensive hardware (chips, IR. RF, etc,) plus software. Make this available to all comers ar cost– say. a few $ per component.

Then, Apple, elegantly, makes it all work together with Apple boxes (AppleTV, HomeServer, Computers, iPhone/Touch IRCs).

32 roz { 06.03.08 at 2:12 am }

I’d like to see it have a version with a blueray/dvd player built-in.

A lot of people will be buying those soon. Having a device that does a lot more would be great. Also, people will only tolerate so many boxes by the tv so this would kill 2 birds with one box.

33 mark_g { 06.03.08 at 3:24 am }

I would like to see the iTunes Radio feeds made available on MacTV. And I would also like it easier to add radio feeds to iTunes (with the ability to put them into the Radio sub-menu

34 imat { 06.03.08 at 5:24 am }

I have an addition to the list.

Although I agree with most of the points (except the Netflix-Blockbuster one) it is my opinion that the best way to finally launch Apple TV would be to distribute content, a lot of content, worldwide.

Currently only the US and a handful of other countries’ iTunes Stores sell something that makes the Apple TV a compelling choice. No need to venture in gaming, for the time being, and step directly on competitors toes (Sony, Nintendo, Microsoft).

Apple should really focus on delievering HD content seamlessly worldwide as a first step. This complements with the ideas like the “iPhone-iPod Touch remote” or web browsing abilities.
The path could be similar to the iPhone: after having had a first version available (legally) to only a handful of customers, strike deals to make the same content available worldwide.

Selling TV series and movies, renting HD movies worldwide is the most difficul thing for Apple to do but, in my opinion, the only one which will create substantial value in customer’s minds and allow the device sales to take off.

Look at the HD TV broadcast landscape in Europe. There is only a couple of alternatives (very expensive ones). Given the choice (and Apple’s ease of use) I think customers would flock to the store and buy AppleTVs in great numbers.

Of course pricing is an issue, but currently there is far to little content available outside the aforementioned couple of countries to allow the AppleTV to be more than a hobby for Cupertino.

35 Cletus { 06.03.08 at 7:19 am }

Another thing that needs to be done that is quite simple is push apple tv’s to the public. They are supposed to be a stock item in Best buy but go in and have a clerk try to get you one. None available anywhere in their system.

I know you can go to apple.com/store and get one, but, when your browsing in the store looking for a tv having that box there would sell a lot more apple tv’s with all the things Daniel and you users have mentioned

36 JLMoran { 06.03.08 at 10:19 am }

Daniel, while I normally agree wholeheartedly with your postings, I think you are way off base with this as far as making the iPod Touch or iPhone the remote control for this device. You specifically note in the very start of the article:

“The problem, as noted in the previous article, is that buyers are somewhat hesitant to shell out $229 for box that primarily rents movies.”

But then you state:

“Most Apple TV users likely already have an iPhone or iPod touch however, and those that don’t would certainly get one if they could use it to remotely control their Apple TV from anywhere within WiFi range.”

So let me get this straight — People are already hesitant to pay $229 for just the basic unit, and yet you’re claiming that they’ll happily plunk down another $300 to $500 for an iPod Touch or iPhone to use it as an enhanced remote control?

That defies all logic, Daniel. And with that blown out of the water, every one of your other items that has a dependency on it gets shot down as well.

Apple is trying to sell this as an everyman consumer device, not just for the elite of the digerati. So there’s no way in Hades Apple will take the course you’ve described. I’m sure they’ll work to improve the existing remote in ways that make sense, but at the absolute best using the iPod Touch or iPhone as a remote will be relegated to an option, possibly done with third-party software along the lines of Salling Clicker.

- Joe -

37 stefn { 06.03.08 at 10:58 am }

@ dicklacara
I don’t know enough to argue, except to say that TV pricing ranges from $100 to $10,000, so it seems like Apple can find a profitable niche by offering a great TV plus all the many benefits of OSX technologies, as Daniel suggests. Two things:
* TV and PC technologies are merging. I’m ready to throw my set out as are many others.
* OSX will move into sets at some point, in some guise, and for the same reason it was put on a cellphone: to offer huge features unavailable to competing hardware.

38 iPaulo / Apple { 06.03.08 at 12:08 pm }

[...] would add two other things to this list of things Apple could do to improve the Apple TV: an unlimited rental option and HD TV episode content. I wonder if I would even need cable TV if [...]

39 Gatesbasher { 06.03.08 at 5:20 pm }

I’m asking myself: would all these improvements compensate me for my biggest disappointment: that after anxiously waiting for 25 years for HDTV to really become available, and for something like Blu-Ray to provide content, I’m told they’re going to die out, to be replaced by HEAVILY compressed 720p downloads (or heavily compressed 320 x 240 downloads for viewing on a 2″ screen)?

I have to say the answer is “NO!”

40 dicklacara { 06.03.08 at 6:09 pm }

@Gatesbasher

My guess is you are right– the answer is no!

–just as for the audiophiles in the late 1950′s when superior-quality Hi-Fidelity sound was superseded by the stereo “gimmick” (remember 4-way stereo with the little joy stick?)

–then the superior sound/video quality 2-hour BetaMax VCR was superseded by the more convenient 4-hour VHS format

Now, today, convenience and “good enough” will, likely, win the day over the best available AV format.

But, all is not lost– technology moves forward in fits and starts. There will be another “new thing” that will offer better (potential) AV quality… but you will never quite get there.

The best solace I can offer is:

The story of the mathematician and the engineer who stood on one wall of a room. On the opposite wall stood a beautiful naked woman. Their challenge: take as many moves as you like, but each move must exactly halve the distance between you and the woman.

The mathematician said: “Why bother, I can’t get there!”

The engineer said: “I can get close enough!”

41 Avon B7 { 06.03.08 at 6:42 pm }

I suggested a product spinoff for the iPod Touch shortly after it was released and that was a universal remote control.

I’ve been using universal remote controls for years and they all lack in usability.

The iPod Touch design could be used to fashion a URC and coupled with good quality software could really make people’s lives easier.

A complete 16GB iPod Touch is already cheaper than a Harmony 1000. By removing much of the innards of the Touch design and adding IR they could bring prices down and sweep the market (Windows users too).

Adapting the Apple TV and making the software available on future iPhones/iPod Touch would be a piece of cake. They could even sell an adaptor to allow current RF iPods/iPhones to send IR signals to our existing equipment. Apple just loves shipping 29 dollar accessories.

The key is getting the software right. The current hardware design allows for a clean slate and removes the hardwired buttons of most URC’s. I would be glad to see the back of hardwired volume UP/DOWN buttons as they are the ones that get the most use and fail first. I want to design my own labels for my needs and not have to pay a fortune for the right to do so. I want an easy way to get discrete codes on my remote too. Of course any such remote would also have to be ‘learnable’.

I hope Jobs has already seen the alternative uses for the iPod Touch.

42 Gatesbasher { 06.03.08 at 6:55 pm }

@dicklacara:

Yeah, as an old audiophile, don’t get me started on that! After eagerly awaiting the outcome of the format war between DVD-Audio and SACD, only to see them both tank in favor of 128,000 bps Auditory Sandpaper™, I’m pretty much in despair on that front. We have a whole generation now who are capable of listening to that without covering their ears and screaming: “Make it stop!” and worse yet, are willing to pay money for it. Meanwhile, people will pay hundreds of dollars for “Home Theater Systems” with 9% (!) Total Harmonic Distortion, when 0.1% was entry-level for $100 receivers 30 years ago! Oh, well…by the time my Carver separates die, hopefully my hearing will have deteriorated to the point I won’t be able to “tell the difference” either.

43 dicklacara { 06.03.08 at 10:53 pm }

@Gatesbasher

I hear ya!

In the 1960′s my Dad made Hi-Fis that could make a candy dish jump off of a marble coffee table (1812 Overture)– and bass that you could feel in your gut (and would rattle the windows)… folded horns, big McIntoshes that rattle your intestines… what a feeling/time for music!

44 HD Boy { 06.04.08 at 1:18 pm }

The movie and computer industries don’t want to hear this message, but settop boxes like the AppleTV will remain attractive to small, niche markets of geeks only until a Blu-ray player with DVD-burning is added.

Besides watching movies, or an iMovie DVD that someone brings over, I can’t tell you how many times I’ve shown my own little home movie or family slide show on my PowerBook connected to a 43-inch, HD plasma screen. It really would be a hassle to use AppleTV for these presentations without having the ability to burn a quick DVD on the spot…Family members ALWAYS want a copy of any presentation.a
…So, I keep hesitating on purchasing AppleTV…

45 alphaeus - think, design, create » Archive » A landmark event. In more ways than one. { 06.04.08 at 1:38 pm }

[...] rumor mill is already on. From iPhone 2.0, to a remote control ecosystem based on iPhone and iPod Touch hardware, to a pre-presentation of Mac OS X 10.6 everything could be [...]

46 LunaticSX { 06.04.08 at 9:04 pm }

“Likelihood of happening: this is so simple and obvious that its hard to imagine why Jobs hasn’t released it yet.”

There’s a simple answer to that: Distraction.

Apple is a very focused company, now. They know their target markets, and they target them with precision.

Doing any of these things too early takes away time and resources from their more important core businesses. That’s why Steve Jobs called AppleTV a “hobby.” They spent a minimal amount of time on it, and they’re still in effect tinkering with it on evenings and weekends.

They know their day job is to work on Mac OS X, Mac desktops and laptops, iPods and the iTunes ecosystem, and the iPhone. Those are the things that are appealing to the vast majority of their market. That’s what puts bread on their table.

These other things are appealing to only small slices of their market (especially the geeks and nerds, who think if something is technically possible, it should be done by all means, regardless of the delays it causes and fuzziness it adds to the product’s message–”it’s a vacuum cleaner AND a meat slicer! Only from Ronco!” Ever wonder WHY those Ronco multi-use devices weren’t more mainstream?).

Even as it was, the v1.0 AppleTV was too vaguely defined and nerdy for most people, which is why Steve Jobs changed its focus to target movie rentals, WITHOUT requiring the use of a computer.

I’m personally glad that Apple keeps their focus and incrementally improves upon their products where it makes the most sense. It’s always been a failing of Microsoft that they tried to throw every feature possible into their products, resulting in many difficult to understand and configure messes (you know the adage of adults needing a teenager to set up their computers and electronics products–to a teenager’s mind everything in life outside of their previous experience has similar complexity, so taking the time to figure out something electronic is no different from learning other life skills like how to drive a car, cook a meal, or handle their own finances). Sony’s even fallen into this trap after being well respected for making products that just work.

Daniel, with your previous writings explaining how Apple has incrementally built upon their past successes, I’m surprised you’ve fallen into the trap of wondering why Apple hasn’t yet made AppleTV more of a technological geek’s Swiss Army knife set top box.

The time may come when Apple adds features similar to the ones you describe. It’s simply not surprising that they haven’t done it before now.

47 danieleran { 06.04.08 at 9:59 pm }

@JLMoran: The reason why a $200 remote control is silly but a $400 iPhone/iPod touch acting as a remote control is not is that the iPhone does other things as well and many users already have one.

It’s like comparing a $10,000 car stereo and a $20,000 car with an even better car stereo in it. Which is the better deal shouldn’t be a mystery.

48 Argosy { 06.04.08 at 11:33 pm }

dallasmay

I also think this is a great idea. Apple would have to allow content providers a method for preventing users from fast forwarding through their commercials (as they do on their own sites). But, I for one, would welcome the ability to stream any show I like for free with the restriction of having to watch commercials.

I also like the idea of using my iPhone/Touch as a remote for the tv. Mostly since it could eliminate turning on my tv simply to select what music I’m listening to. I also agree that all the features would have to be available on the “included in the box” remote. Using an iPhone/Touch would be a beneficial option to those who had one (or chose to buy one for that matter.

Not against Apple selling a standalone universal remote which is basically a touch w/o the flash memory. But I don’t really see them doing that

49 Argosy { 06.04.08 at 11:37 pm }

Edit to my post—

here is Dallasmay’s suggestion which I agree with”

“Another option that might appease the Television co’s more is adding a way to show commercials.

Let NBC and the gang podcast their shows with commercials if they distribute them for free. If viewers want them without commercials they will have to pay the $2 fee. I for one would rather have commercials than pay $2. In fact, my wife and I have been watching LOST all season through ABC’s website in HD on my computer. It’s really pretty good.”

50 Argosy { 06.04.08 at 11:43 pm }

Along the same lines. As noted on Cringely’s site
http://www.pbs.org/cringely/

If you allow the networks to have commercial spots in “podcast” TV shows, allow Google to serve up commercials depending on what you have been searching for recently on Google. “Legitimate” advertisers….you know, Home Depot or such, not ads for more porn sites…. ;v)

You’ve been looking for lawnmowers recently, then you watch the podcast version of Lost, the first commercial is sold to Honda or John Deere….

51 labrats5 { 06.05.08 at 10:52 pm }

You see Dan, this is why I read your site. Despite the fact that you are heavily biased towards Apple, you are almost always right. I agree with basically all of your points except 1 and 5, which I only partially agree with.

Yes, The @tv needs a better input device. Yes, allowing an ipod touch or iphone to be that input device would be a great feature which they should totally add.

However, the current apple remote needs to be totally and completely replaced. An optional peripheral (however cool it may be) will not help them. Just look at nintendo. They had the dissapointing gamecube, a hugely popular handheld in the GBA, and tried to tie the two together. It failed miserably.

The situation is almost exactly analogous to Apple’s. For the @tv to be truly killer, it needs a killer input device bundled with each and every unit. An ipod touch, even stripped of all non-remote functionality, would be prohibitively expensive to bundle. They need something else.

I personally see no reason why Apple shouldn’t rip off the wiimote. It’s obviously the best solution to their problems: it provides a rich and intuitive pointer-based control scheme, perfect for a safari browser and third party apps, and a proven method for controlling games. Basically, your 2nd and 3rd ideas fall out of it effortlessly.

As for 5, Apple should partner with Netflix… and Microsoft and Sony and Tivo and everyone else who wants the one thing truly holding back video digital distribution: the lack of legal DVD ripping. That’s what allowed digital music and the ipod to take off. You think anyone would have bought an mp3 player if you could only put dowloaded music on it? It was the promise of having your music, ALL your music on you that made mp3 players take off.

The @tv will never truly become successful unless it can fulfill the promise of digital media: having all of your movies wherever you want them, whenever you want them. And unless DVD ripping becomes legal, this promise can never be fulfilled for the vast majority of people.

52 anonymous500r { 06.06.08 at 7:26 pm }

Great idea! A £400 remote! And what’s that? I have to pay £30 a month to use it? And multi-touch? That’s so much easier to use than a remote! I don’t buy it. And why – when Apple is marketing the Apple TV as a PC companion product – would it need web-browsing when you can pick up your MacBook and go online?

53 Avon B7 { 06.07.08 at 6:02 pm }

Well it wouldn’t be a $400 remote. It would be an iPhone/iPod Touch with remote functionality.

My suggestion for them to make a dedicated remote would allow them to do it for much, much less than any current universal, touchscreen remote on the market.

As for ease of use, I think you need to actually use a good universal remote (especially a touchscreen one) to understand exactly why they have the potential to be addictive.

Imagine being able to design you own buttons and have them on exactly the same place in the interface.

I have a Plasma with built in DVB, a DVR with built in DVB and a dedicated DVB decoder. That’s three units with EPG functionality that is in different places on their respective remotes.

A touchscreen remote would allow me to have the EPG button in exactly the place I want it.

Just apply the above to everything else that is spread out over different buttons with different names on different remotes and you begin to see the advantages.

Think about foreign users finally being able to label buttons in their own languages.

Think about discrete codes, macros etc.

54 ridecycling { 10.19.08 at 2:24 am }

Not sure if I read it, but one key point would be to easily allow burning DVD’s to iTunes the same way one can burn CDs – that would make the product even more interesting. Plus the ability to use it as pure wifi music server via a computer without the need to run a TV monitor would also be a good addition. Hopefully it will get there. Was it just me, or do these things run really hot?

55 How Apple TV can score at the big 3.0 — RoughlyDrafted Magazine { 02.05.09 at 2:35 am }

[...] Review: Netflix Player vs Apple TV Five Ways Apple Will Change TV: 5 Five Ways Steve Jobs Can Turn On Apple TV Sales [...]

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