Of course, there are other rumors that support the idea that Apple has working prototypes of such a device in development. Steve Jobs biography even hints at such a product. So, for the sake of argument, let’s believe that Apple is actively working on a television set and does plan to release it at some point in the not-so-distant future.
Does it matter? Unless the release of such a product also brings about a restructuring of Apple’s media commerce systems (iTunes, I’m looking directly at you), I don’t believe that it does. While the product will definitely be an improvement over other comparable sets, it will have an Achilles’ heel if it employs a system similar to what is available today.
In The Verge‘s breakdown of what Apple offers in terms of content, software, and hardware with regards to the living room and entertainment systems, Ben Popper remarked:
The bill, when it did come, was a rude reminder of what happens when content can be purchased a la carte. Individual episodes ranged from $1.99 to $2.99 and a season pass can run you anywhere between $19.99 and $42.99. With two films, four individual episodes, and three full seasons combined, my wife and I once managed to spend upwards of $80 in a single week, more than what a cable subscription would have cost us for a full month.
That’s a pretty crazy realization. And since Apple is unlikely to price their television set on the lower end, it’s going to be quite the cost. Yes, the amazing experience that the device would have to offer – after all, it is Apple – would offset some of the price. But, given that much money over time, it simply wouldn’t be worth it.
Instead, if Apple is to release a television set – or, frankly, even to focus on the Apple TV, which is so far merely a “hobby” – there will have to be an overhaul of the foundation which has served the company so well with iTunes. There will have to be some sort of subscription service, which would help to offset such a high spending streak by creating a more reliable medium price that offers a baseline of content. That baseline of content also couldn’t be the bottom of the television barrel, the outcasts of Hollywood – it would have to be competitive with what the cable companies offer. That, combined with Apple signature elegance, could create an absolutely killer product which would warrant a higher price tag than other, “dumb” televisions that have to be connected to the cable company’s pipe to function.
Apple is at an interesting intersection: they have three healthy, growing product lines. The iPod line, the only downside to an otherwise fantastic financial report, is relegated to the side but is still profitable. They have the money to make a device as ambitious as this rumored television work – they have the clout to topple the cable companies, and to turn the entertainment industry on its head. They’ve done it before (oh, hey music industry), and it can happen again. The only aspect lacking is Steve Jobs – this could be Apple’s first test. Will they create a “me too” product, or redefine the industry as they did with the iPod, the iPhone, and the iPad?