Time For Apple TV To Go From Hobby To Strategic Product

With the successful launch of the iPhone 3GS last spring and a new version of OS X and a new crop of iPods expected this fall, one player in Apple's lineup seems to have gone missing, namely Apple TV. On Apple's financial conference call, the device that Steve Jobs once described as "a hobby" was not mentioned once. I hope Apple hasn't given up on this category as there's a lot of value and function in Apple TV that has yet to make it into other products in this space.

We know from our research at Interpret that, while consumers rank the ability to get content from their PC over to their TVs as highly desirable in terms of something they'd like to do, it's actually pretty low on the list in terms of an activity they're actually engaged in. That type of gap between aspiration and activity is the kind of vacuum that opportunity is made from. Apple didn't invent this category of device, but they have focused on several areas in the Apple TV that makes what they've done stand out among the other players on the market. Yes, other vendors could have done the same but, as with the iPod, they didn't.

1. Ownership of the network – You've heard me rant about this before but the home network is a mess. Once you talk about moving beyond the basic utilitarian function of sharing an internet connection, things break down pretty quickly. That's why it's important that Apple has taken ownership of the home network. You don't need a Macintosh running 802.11n or an Airport that likewise runs that protocol to make things work. If you're comfortable going it alone, that's fine. Apple, however, does offer a complete end to end solution which they will support and take ownership of any issues that might result. I can't downplay how important this is, consumers can buy knowing there's a script they can adhere to and make stuff work.

2. Be True to the UI – There are two different user experiences vying for users attention, the two foot experience of the mouse and PC and the ten foot experience for consuming content in the living room. They key is that Apple TV understands the difference. Sure, you can hook up a Mac mini to your TV (or any other PC for that matter) but there's still a disconnect in the experience. PCs were meant to be used with a mouse and keyboard and PC interfaces were designed for a two foot and not a ten foot experience. Yes, you can go back and forth between them in either Front Row or the Media Center shell in Windows but you're still forced to move back and forth between two worlds that essentially collide. While that will be a perfectly fine approach for many folks, it's far more seamless to the masses to let the PC stay where it is, and be used to create content, purchase new content and manage it overall (along with other traditional PC tasks best handled in the traditional manner) and use the ten foot UI for its best purpose, namely consuming content (whether that's pictures, video or music) in the living room.

3. Keeping things in Sync and across platforms – That internal hard disk is really important. It means that not only can I download content directly and stream content from my PC but also keep things in sync which creates even better performance and that translates to greater user satisfaction.

4. Attention to detail – When it comes to consumer electronics, success or failure can often be measured in millimeters, both literally and figuratively. This is where Apple TV shines, in attention to detail. Most competing devices on the market forgo some of the basic details, like HDMI support. Apple understands these issues, so while HDMI might not be of super interest to everyone today, Apple knows that, among those folks, it's a huge deal and will likely be super important to the mainstream folks buying in the near future. It's attention to stuff like this that separates this device from the others.

5. The iTunes Eco-System –When you're talking about protected content (which is of course needed for rentals) devices drive the users to the services, not the other way around. The fact is, this is the rental service that works with iTunes and therefore Apple TV, iPod and iPhone (rentals will only work with current generation iPods). That means it works on your TV, PC, phone and media player, exactly the type of content flow consumers are looking for. At the end of the day, if it doesn't work with the iPod and iPhone, then for most consumers it might as well not exist.

For me, these are reasons enough to purchase but there's more that Apple could do here. For one, they could open the platform up to third party developers. Imagine an Apple TV that could also serve up Netflix, Pandora and Hulu. Or an Apple TV that could tap into the iPhone/iPod Touch eco system and play games among other apps (Apple's already shown how the iPod Touch or iPhone can be used with an Apple TV with gestures as a command and control mechanism, imagine those devices as game controllers as well). It's would be great to see Apple officially allow third parties into the Apple TV eco-system and not only strengthen their position in the living room but provide more reasons for consumers to own both devices.

Despite the lack of recent updates to Apple TV, the integration of content and the TV screen is too important for Apple to ignore. I believe Apple is serious about the TV and we'll see more from Apple TV in the future (although I don't think Apple will get into the TV screen market as some have suggested). The ability to flow content to all the screens that are important to consumers is strategically important to every vendor in the personal technology space. It's time for Apple TV to go from "hobby" to strategic product.

[Apple TV image courtesy Max Lewis]