In Hacker News discussion "TV will be Apple's Undoing"
TV won't be Apple's undoing but it also isn't obvious that they can win big there.
is a complicated business with a number of interlocking players at
different levels and vested business interests. It is also a global
business with rights packaged up at a very national level and sold with
While the biggest MSO's in each country (cable,
satellite and terrestrial operators depending on the market) have the
scale to lock in key content/channels to exclusive deals it will be
fairly hard to break into the market in a devastating way. At the
moment they have the scale and the revenues to do exclusive deals with
the content creators (that they don't already own) to keep a large
proportion of their customers from leaving. They (not the content
creators/owners) are the big bullies in the market and would be hard and
expensive to topple.
An AppleTV (including screen) if it does
happen will need to be a good enough content offer for most people or it
will not be a massive success. If they still have to use their cable
box it can't be a game changing user interface because you are looking
at the STB interface most of the time.
It's not impossible for
Apple but it also won't be easy, particularly to go global. It will
cost money to get content which might break Apple's principles and set a
bad precedents for them. They also can't go that expensive because
while I'm sure the UI will be better Samsung/Sony and some of the others
really aren't that bad and the cosmetic designs don't leave that much
room for minimalist improvement.
business case for Apple is far from clear for me at this point but it
would be a way to take the war to Samsung that would cost Samsung far
more than a billion dollars even for an Apple relative flop. The
collateral damage might kill Sharp unless they supplied the panels and
would be another knife in Sony/Panasonic/Toshiba that they could do
batista > Funny, the said the exact same thing about mobile...
Nearly true but I think the
situations are really different - the rights packaged up and sold with
exclusive deals didn't apply in a relevant way and there wasn't the same
level of complexity.
Carriers were essentially indistinguishable from
a customer viewpoint. There was no significantly different content
depending on which carrier you used or at least nothing that you would
care about if you had an iPhone. This does not apply between broadcast
platforms. The exclusive deals any carriers had for content were small
scale apps or information services not multi-billion deals for packages
of content for particular countries.
Apple played divide and rule
between the carriers brilliantly working with a single operator in each
country. In some countries that might work for TV where there are well
balanced alternative platforms but in others it won't work because there
is a dominant player who won't give up control and the challengers are
too weak to help Apple much.
In TV there are the content
originators (movie studios, sports leagues, independent production
companies), one level of aggregators that commission and purchase from
the originators and bundle it into channels and another level of
aggregation by the service/delivery/billing platforms (MSOs). And then
it is sold to the customer. These divisions are not clear and
ownerships ofter cross levels.
In mobile it was fairly simple with
carriers being the clear centre of the business, buying and subsidising
phones and running the infrastructure. There were a couple of
platforms running across different phones such as BREW and JavaME but
they were more feature tickboxes than major market players.
doesn't mean it was easy for Apple but the fact they had at the time a
truly revolutionary product and reality distorting leader AND there was
level competition between the carriers meant that they could pull off an
amazing industry changing deal. They had to pull off this deal once in
each country not with dozens of different rights holding players (they
don't need them all but one deal per country would only be enough with
the dominant MSO and probably wouldn't be on good terms as the MSO would
know that there is a risk that Apple would want to cut them out when
they were big enough).
I also didn't say that it was impossible
for Apple to break into the TV market in a massive way but I certainly
don't think it is easy or that there is a clear route to massive
success. I certainly don't believe it is possible at their current
margin levels for either hardware or content but it will be interesting
I used to do what was
really a Business Development and Product Planning role for Sony's
European TV Business so I have met with many cable, and a few
terrestrial and satellite operators in Europe to persuade them to make
their content available over their networks to consumers TVs with CI+
(think European CableCard but not quite such a broken model). Later I
worked with many channel operators to bring them onto Sony's Internet TV
platform so I do have some understanding of the TV business.