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Smart telly trends make Apple 'iTV' a certainty

Cupertino would be mad not to

Internet Security Threat Report 2014

Telly vision

Likewise, its AirPlay, Bonjour and other networking technologies are already present to make moving and streaming content from any one of the trio of devices to another easy and largely set-up free.

Of course, it's already doing all this, through its Apple TV set-top box, so why should Apple go the whole hog and build the box into a large display?

Here DisplaySearch's data shows a clear pattern: media streaming boxes have not proved a big hit. Apple TV remains a "hobby" product for Apple - translation: it sells in relatively low numbers. DisplaySearch figures for the time users' spend watching online video content presented by different devices shows media streamers well behind Blu-ray players and even further behind games consoles.

Media streamers may be cheap, says DisplaySearch analyst Paul Gray, but many Blu-ray players are barely more expensive and deliver video streaming as well as higher-quality optical disc playback.

DisplaySearch forecasts that media streamer shipments in Europe will struggle to exceed three million units a year over the next three years or so. Blu-ray player sales will have gone past 10m units by 2013, while games consoles average 27m units through to 2015.

But Smart TV shipments will grow from over 30m units this year to 50m in 2015. Even if Apple remains a very small minority player in the Smart TV market, it's going to sell a lot more tellies than set-top boxes.

And with European tablet sales forecast to grow even more rapidly - from 24m in 2012 to 50m in 2015 - Apple is in a strong position not merely to subsidise its early TV endeavours through iPad sales but also to leverage the latter to encourage TV sales.

Of course, today's TV vendors will be doing the same thing, some successfully, others less so. Unlike Apple, though, they'll be starting from a less tightly defined ecosystem. TVs have evolved by accumulating features and technologies, and that has led to inconsistencies that frustrate users. A given TV may play AVI files, for instance, if they're on a drive plugged into one of its USB ports, but not when streamed from a network share by DLNA.

Techies may, not unreasonably, complain about the relatively limited array of standards Apple supports, and the walled garden, but there's not question these things make life easier for folk who have bought into the Mac-iPhone-iPad ecosystem. Content plays, subtitles appear; there's no confusion between codecs and container formats.

So Apple is well placed to address the key challenges TV vendors have to face: the arrival of internet TV and the need to mediate and manage this profusion of content; and the growing similarity between the chips that sit behind the screen, whatever size it is.

Address this consumer need and the business case for entering a depressed, margins-pushed-to-zero-or-less market - which is what the TV arena is at the moment - is a lot stronger. Throw in the cost savings of cross-fertilising phone, tablet and TV hardware and software, plus the brand's price premium, design abilities and some advanced display tech for good measure, and you have a recipe for success.

Apple would be mad not to release a TV. ®

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