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Why Apple TV is more important than iPhone
41 commentsApple could unleash Apple TV this week, and this device, not the iPhone, could become the most important Apple product launch since the original iPod.
That's because the stakes are much, much higher for Apple TV than iPhone. If iPhone succeeds, it will bring lots of revenue into Apple, but it basically is just an iPod with phone capabilities and a unique user interface. Apple TV, however, could open a whole new market for Apple and also has the potential to bring Internet distribution of movies and television into the mainstream.
Apple TV will connect computers to televisions. In other words, you can download movies and television programs to Apple TV, which can manage the media and distribute it to televisions throughout the house. Plenty of products with similar aspirations have failed, but this is Apple, after all. It not only has the ability to market the bejeebers out of Apple TV, but it also is likely to make it simple enough that even technical neophytes can set it up and use it and useful enough that everybody will love it.
If Apple TV succeeds, it could revolutionize digital media in general the same way iPod revolutionized digital music. There were plenty of media players before iPod was released, but it took Apple to make it work. Now, downloading music and playing it on a mobile device is so common that the idea barely is discussed anymore.
But times are different now and that is one reason that Apple TV could fail. IPod has been a success both because of and in spite of the fact that it works only in a closed system with iTunes. Being tied to iTunes worked when iPod was introduced because it greatly simplified the act of acquiring music online. That was despite the fact that users were tied to a single online music store, which made it difficult for other vendors to create competing online music stores.
But iTunes was started at a time when there really wasn't any serious legal competition for online music distribution. Now, however, there are plenty of sources of downloadable films and TV shows. Yet, Apple is insisting that Apple TV be tied only to iTunes. With all the other options available, Apple, for all its prowess at creating fierce customer loyalty, may not be able to make Apple TV work. Suddenly, closed distribution may work against, not for, Apple TV.
If Apple succeeds, Apple TV could do for moving pictures what iPod/iTunes did for music. That would make Apple both the most successful hardware maker and online media distributor. But the attempt also shines a light on Apple's my-way-or-the-highway approach to customer loyalty. So far, that approach has succeeded. This time, things could be different.
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