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Should You Believe in an Apple Inc. (AAPL) 4K TV?

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The TV industry continues to search for the next big thing that can potentially reinvigorate a new upgrade cycle. TV technology doesn’t change as rapidly as other consumer electronics industries, and we can go ahead and consider the attempted transition toward 3-D dead.

At this year’s Consumer Electronics Show, 3-D TVs were nowhere to be found, and that’s a good thing because it was so obviously a gimmick from the get-go. Companies are now turning their attention toward 4K TVs, which boast “Ultra HD” resolutions. The “4K” moniker refers to the horizontal dimension, which is approximately 4,000 pixels. One challenge with 4K adoption is that there’s really not much content optimized for such high resolutions.

Apple Inc. (AAPL)

Apple Inc. (NASDAQ:AAPL) has successfully popularized super high-resolution displays in mobile devices like smartphones and tablets, and is working on doing the same in PCs, starting with the Retina MacBook Pros. The latest rumor out of DIGITIMES suggests that Apple is interested in launching a 4K TV with a 3,840 x 2,160 resolution, which doubles the dimensions of standard 1,920 x 1,080 HDTVs.

Can Apple Inc. (NASDAQ:AAPL) push the TV industry forward in the same way?

Not you again
The questionable report says that Apple has been trying to line up panel suppliers, but most Ultra HD panel vendors are booked up through 2013. Meanwhile, Apple already has other capacity locked down at panel makers for its iDevices.

DIGITIMES believes that Apple Inc. (NASDAQ:AAPL) is hoping that LG Display Co Ltd. (ADR) (NYSE:LPL) can pitch in with Ultra HD panel production, as LG Display is one of Apple’s primary display providers for its other products. If LG Display can get its facilities in order, Apple could potentially launch the long-rumored iTV by the end of 2013. However, chances are that the Mac maker will end up launching in early 2014, if DIGITIMES‘ dubious predictions turn out to be accurate.

First off, I wouldn’t doubt that Apple has 4K TV prototypes, since the company makes all sorts of prototypes that never see the light of day. At the same time, it’s a long road between prototype and commercial viability. If such prototypes exist, perhaps that’s where these rumors come from.

Here’s why Apple Inc. (NASDAQ:AAPL) faces much larger challenges in catalyzing 4K TV adoption — and why it’s so unlikely.

Lessons learned
First, we should look at the industries where Apple has or is in the process of catalyzing high-resolution change, and we’ll see that there are some very notable differences.

In mobile devices, displays are relatively small, which also means that the cost for a consumer to adopt a high-resolution display is less (or nonexistent with the presence of smartphone subsidies). When Apple went from the iPhone 3GS to the iPhone 4’s Retina Display, consumers didn’t have to pay a dime more than the $200-on-contract price. Meanwhile, it incentivized its legion of developers to optimize apps and content for higher resolutions.

It then had both pieces of the puzzle: consumer willingness and optimized content. It’s fair to say that high-resolution displays are the standard now for high-end mobile devices, and Apple Inc. (NASDAQ:AAPL) no longer holds the title of having the greatest pixel density.

In PCs — a transition that’s still under way, starting with laptops — Apple is quite literally the only company that could spark the industry into action, specifically because of its integrated strategy. The segmented value chain on the Microsoft Corporation (NASDAQ:MSFT) Windows side meant that no company had an incentive to push high-resolution displays, and such a major transition required everyone’s cooperation.

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