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When a sentence appeared in Steve Jobs' biography that The late visionary cracked the secret of user-friendly television, there has been a whirlwind of information about "iTV", a television from Apple. For a long time, journalists, engineers, analysts and designers puzzled over how such a product should look, what it should be able to do and how much it would cost. But what if no television is actually going to be made and the whole fuss was made just out of a better idea Apple TV?

The issue of the television market

The HDTV market is not in the best of shape, year-on-year growth has shrunk from 125 percent to just 2-4 percent over the past seven years. In addition, analysts assume that the market will experience a decline starting this year, which is also indicated by the first three quarters of 2012. In terms of market share, on a global scale, Samsung leads with more than 21% share, followed by SONY with roughly 15% share, other important players are LGE, Panasonic and Sharp. According to analysts, Apple could gain 2013% in 5 with a possible TV, provided it starts selling its TV solution in the near future.

However, the TV market has two major disadvantages. The first is that it is a segment with relatively low margins and as a result companies are making losses. In March of this year Reuters reported the annual losses of the TV divisions of Panasonic, SONY and Sharp, where the former company lost 10,2 billion dollars, for the same period SONY had a net loss of 2,9 billion. Unfortunately, the money invested in development and production is sometimes difficult to return on small margins.

[do action=”quote”]Would it not be more tactical for Apple to leave the TV market alone and instead focus on something that anyone who already owns a TV can buy?[/do]

The second problem is the saturation of the market and the fact that, unlike laptops or phones, people do not buy televisions as often. As a rule, HDTV is an investment for five years or more, which is also the reason for the weak growth of the market. In addition, it must be remembered that there is only one large-format television in one household on average. So wouldn't it be more tactical for Apple to leave the TV market alone and instead focus on something that anyone who already owns a TV can buy?

Accessories instead of TV

Apple TV is an interesting hobby. From an add-on for iTunes, it has evolved into a box full of Internet services and a wireless HDMI connection. A fundamental change was brought about by AirPlay technology, especially AirPlay Mirroring, thanks to which it is now possible to wirelessly send an image to the TV from an iPhone, iPad or Mac (from 2011 and later). However, essential Internet video on demand services are slowly making their way into the Apple TV environment, Netflix recently supplemented Hulu Plus and Americans currently have relatively abundant options for watching video content (such as NHL or NBA sports broadcasts).

What's more, Apple is currently according to the journal Wall Street Journal is trying to negotiate with cable TV providers so that it can offer live broadcasts in addition to existing services. According to an anonymous source, the concept is that the Apple TV could, for example, upload live series to the cloud, from where the user could later play them while playing previous episodes thanks to the existing series offer in iTunes. One would thus have access to live streaming and on-demand video in a single interface. WSJ he further claims that the graphical form should be very similar to the user interface of the iPad, and iOS devices could also be used for watching broadcasts.

However, the agreement between Apple and the providers is still in place WSJ far away, the iPhone maker still has a lot of negotiations to do, mainly due to rights. In addition, the Cupertino company was supposed to have quite tough requirements, for example a 30% share of the services sold. However, Apple is nowhere near where it was with the music industry more than a decade ago. American cable TV providers are certainly not in crisis, on the contrary, they completely control the market and can dictate the terms. For them, the agreement with Apple is not the salvation of a dying market segment, only an expansion option, which, however, may not necessarily bring many new customers, as most would convert from users of existing set-top boxes. To give you an idea, in the US the provider has an almost monopoly position Comcast with approximately 22,5 million subscribers, which further licenses broadcast rights to smaller companies.

Apple TV has a lot of potential, it can very easily speak to the console market and it may just be the key product to get the "living room" of users. Everything that Apple could offer with its television fits into a small black box that could be controlled, for example handy touch remote control in standard equipment (with the appropriate application for iPhone and iPad, of course). The TV hobby, which by the way sold over four million units in 2012, could become a relatively profitable business and a center of TV entertainment. However, it is a question of how Apple would deal with a possible TV offer outside the US.

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Sources: TheVerge.com, Twice.com, Reuters.com
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