An Apple TV Has Its Doubters

By Clint Boulton  |  Posted 2011-04-16 Print this article Print

A new Apple TV service would seem to fit in well there and boost sales for the iPad, iPhone iPod Touches and Mac computers.

"In addition to subscription revenues, we think Apple could potentially benefit from a halo effect that increases units and ASPs for its existing products and provides a foundation for the launch of an iTV-like device," Misek wrote April 12.

This halo effect spurred Misek to raise his 2012 fiscal year revenues to between $150 billion and $171 billion versus Jefferies' current $134 billion sales cushion, and the consensus of $118 billion.

Other analysts are skeptical, noting that connected TVs have simply not taken off for the last decade or so that companies have launched them.

"An Apple TV has been one of the biggest digital unicorns of all time," Gartner analyst Michael Gartenberg told eWEEK April 15, adding that there is no reason to think Apple is building this. "Saying that Apple is going to build a television set two years in the future and saying that for five years doesn't make you right."

Misek is hardly the first financial industry analyst to predict an Apple TV set. Piper Jaffray analyst Gene Munster has been calling for an Apple Web TV service since 2007.

Most recently, Munster said in January that Apple is investing in LCD displays used for Apple's iPad and iPhone lines, Macs with 27-inch screens, and possibly up to 50-inch-screen Apple televisions in the future.

Gartenberg said there are a lot of challenges and risks in the market for such a product, starting with the obvious cost and margin perspective, and moving right on down to the consumer churn issues and channel challenge. For example, Apple received a lot of resistance from TV networks when it tried to offer TV rentals.

"Apple would have to find a way to do this in a way that would be so transformative and so disruptive much as the iPhone was," Gartenberg.



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