Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Apple Inc. (AAPL) – Apple TV & iPhone Mini Speculation

Page 1 of 2

Apple Inc. (NASDAQ: AAPL) has recently upgraded its little desktop box, the Apple TV, but the changes were all internal so there was little fanfare. At $99, the 5 million units sold last year provided just a drop in the $165 Billion (ttm) revenue bucket. So what is point here? Does the upgrade have any real significance for the investor?

I think it does have implications for the investor, in two areas:

1. I think the Apple TV plays an important part in Apple Inc. (NASDAQ: AAPL)’s overall strategy, and

2. It may be that this little upgrade points to a new, upcoming product.

1 – What is the Apple TV?

The Apple TV is a little set-top box that connects to your HD TV/Home Theater, and to your internet (via Ethernet or Wifi) and provides for the delivery of content to the entertainment system. Content sources include:

  • Your iTunes music delivered to your stereo,
  • Your iTunes stored videos (i.e. personal or purchased),
  • Videos rented in iTunes,
  • Your photos shared from iPhoto

You can also display content from:

  • Netflix, Hulu +, YouTube, Vimeo, Flickr,
  • MLB, NBA, NHL,
  • WSJ
  • others to come…?

Finally, with the AirPlay feature, you can display anything at all from your iOS device or Mt. Lion OS Mac on the screen. So any website you can access can be displayed, or any other content you may have.

They seem to be popular with a 4 ½ star rating on Amazon (about as high as you can get in electronics). While Tim Cook’s assessment of the device might be taken with a grain of salt, blog commenter Fkung writes:

We have two Apple TV box in our homes and we love the device. Using these devices, we can access bbc news, CCTV and many other program.
We can now see our photos, videos on the big screen HD TV at home. In fact all our friends and visitors love them when I demonstrate the capability of Apple ecosystem. many have been converted and are now proud and satisfied owners of iPhone, iPad, Mac and Apple TV!

And TimProtech adds:

Best $100 bucks we ever spent. It easily allowed me to cut the cable, saving me $100 every month! I’d say that’s a pretty good ROI.

2 – Why does it matter?

Well, only Apple Inc. (NASDAQ: AAPL) can shrug off a half-billion dollar business as a “hobby,” but the device has an importance aside from the income.

Apple TV plays a very important role in Apple’s strategy. We need to remember, Apple Inc. (NASDAQ: AAPL) does not consider itself a Hardware company anymore – rather a Service company. Its products are not the physical devices, but the user experience that these provide. This, indeed, is what has driven people to flock to their products. (This is admittedly a bit simplistic a view – as are most “either/or” dichotomizations. We all know that the products themselves are designed to please in their own right, but still it is generally valid.)

So the Apple TV plays this very important role in making sure that the content available via iTunes and on one’s Mac or iOS device can be reliably sent to a home entertainment system. Additionally, it does so with Apple’s uniquely simple and elegant interface.

3 – What were the changes?

The folks at Anand Tech have done a great techie review of the device, and they noted two changes:

1. Circuit board layout changes (including new auxiliary chips), and

2. A new version of the A5 chip.

All changes seem to be helping to reduce costs, but number 2 is the more significant one.

Page 1 of 2
Loading Comments...