Apple's Hobby Turns Serious - Will the Apple TV Succeed?

Say what you will about Apple, good or bad, but it's hard to deny they've been raking in the dough with one successful product after another. Just about anything put out with an Apple logo sends people into a frenzy, flocking into stores to buy whatever they're selling.

Except the Apple TV that is, Cupertino's little box that connects to TVs and let users buy content online, and play media from a built in hard drive and network devices. First launched in 2006, analysts had high expectations for Apple TV, spouting off ridiculous statements one often hears during Apple product launches like "It's going to change the world!" "It's Magical!" and "I so want one! What does it do, again?" Suffice it to say, it never lived up to any of the hype.

In reality, Apple TV has been more of a success people give it credit for. Any product that sells over six million units and generates decent profits can't be considered a failure, although it isn't nearly the runaway success of other Apple products like the iPhone or iPad. Most importantly, it's proven to Apple that people will pay to rent and stream video content. Where people pay to consume media, Apple will be there to profit.


So, it should be no surprise that Apple's finally coming out with a new Apple TV box. Like most new Apple products, it's smaller and sleeker than the original, sports an industrial design, and has too few connectivity options.

However, it vastly differs from the original Apple TV. For example, there's no hard drive. It receives streams from the Internet or network only, and don't think about plugging in a USB drive to play media locally - that won't work either. It will still play audio, video, and photos just fine (over a  network), but only up to 720p... behind the times for media playback devices these days.

It's online offerings are what has really changed.  For starters, it hooks into the web to play content from Netflix, YouTube, Flickr and MobileMe. Yes, it's odd for Apple to directly support services that compete with its own. Take note... this is the bare minimum, must-have services to be considered a contender in this space. Besides, Apple's offerings are what sets it apart from any other media-box out there anyway, and those have changed for the better or worse depending on how you look at it. It's pretty much a rent only model now; gone is the option to buy. Movies are $3 to $4, HDTV show rentals are a buck, but for now their TV catalog is limited to content from ABC and FOX.

If you have loads of other Apple gear, there are some cool integration options coming that will let you play something directly to the Apple TV. They call it "AirPlay." It's basically Windows 7's Play To feature, only more creatively named.

Down to business... Will Apple TV be a massive success? If I were to ignore the Apple logo, I would say no. As a set-top media receiver, it's mediocre at best if you compare it to ones like Western Digital's WD TV Live, lacking features like local playback, 1080p HD support, and broad codec compatibility. As a device that connects you to online services, it's severely lacking, particularly when compared to Google's upcoming TV product. Yes, it supports Netflix, but you probably already have devices that connect you to Netflix and YouTube already. I think it will hold its own as a rental device, but between Netflix, Hulu, and my DVR, I would personally rent very little if I had one. Of course, those not giving Netflix or Hulu any money may find value in the rental service.

Factor in Apple's logo, and I think it's almost guaranteed to be a success, not because people blindly buy Apple products (although some do), but because of the opportunity they have to sell it. At $99 it's pretty cheap for an Apple product. At that price, they can pitch one to every person that walks into an Apple Store this holiday shopping for iPods, iPads, and accessories. Think about it this way - if most Apple customers will spend $30 on a piece of rubber for an iPhone, just imagine how easy it will be to get them to drop $99 on Apple TV.


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