Good thing Apple CEO Steve Jobs views Apple TV as the company’s hobby, because if it were a business it’d be in big trouble.
Launched amid great fanfare earlier this year, the device has since faded into obscurity. Apple hasn’t yet released sales figures for the streaming set-top box, but research outfit Forrester believes them to be lousy enough to point to Apple TV as a monument to the “iTunes video revolution that never happened.” Seems Forrester’s estimate of 1 million units sold during the device’s first year have fallen well short of initial expectations. “In addition to the 400,000 Apple TV units we estimate Apple has sold thus far, the company will be lucky to sell another 400,000 in the year-end holiday rush, short of our one million estimate,” said analyst James McQuivey. Worse, while nearly half of all adults with access to the Internet have heard of the device, fewer than 3% intend to purchase one.
Clearly, the vaunted iPod halo effect doesn’t extend to the Apple TV. Why? “The problem with the Apple TV is that its fate is ultimately in the hands of the content owners, not Apple,” Ars Technica’s Charles Jade writes. “Those still thinking Steve Jobs will work out a deal with the movie studios like he did with the music labels need to understand that is exactly why he won’t get such a deal. The best Apple can hope for in 2008 is high-priced, low-quality content, but that isn’t going to save the Apple TV because it never should have existed in the first place. … Rather than be dependent on the content producers for the success of the Apple TV, why not just sell LCD TVs that are an extension of whatever computer is in the house? Sure, margins on LCD TVs are razor thin, but if your goal is to get in the living room you can bet that a TV is one thing everyone will have, now and five years from now. Of course, if the goal is a solid profit on every Apple TV sold, I’m sure the Macintosh TV had fat margins too. For about a year.”