I’ve been reading posts about the AppleTV in anticipation of the device being released (hopefully) tomorrow. One post in particular caught my eye from Apple Insider earlier today. The article’s main focus is on ThinkEquity analyst Jonathan Hoopes’ opinion that the “Apple TV is an ideal conduit for multiple services including DVR, paid-for content, gaming, or advertising.”
His rampant speculation even includes the following quote: “Apple TV can, in our opinion, be easily turned into a DVR with little or no hardware modification and a software upgrade,” he wrote. “We think Apple’s brand, established distribution, marketing power, over 100 million total iPod unit shipments, and 22 million active Mac users would create more than enough energy to propel an AppleTV TiVo-like service to a higher subscription base than TiVo’s current 4.4 million users.”
I have a real problem with this kind of speculation from someone who has a direct effect on if people buy stock in Apple or not. This is rampant, unfounded, speculation that almost has enough completely made up junk in it to constitut it’s own Apple Rumor Generator.
Now, don’t misunderstand…I don’t have a problem with speculation and rumors. I love a good rumor and good speculative posts from bloggers. I love writing (what I feel are) good speculative posts, and commenting on rumors that seem to have some weight to them…but even those have a basis of educated guessing involved with them. This Wall Street Analyst is pulling thing straight of his butt, and people will make investment decisions based upon this information. I don’t think people will take information from a blog as seriously (when making stock purchasing decisions) as they will from a Wall Street Analyst…and if you ARE taking our speculation posts that seriously…STOP IT. We’re speculating…don’t invest your life in the ramblings of a blogger that’s writing at 3:00 am.
Now…having said that…I think Apple is a pretty safe investment. The company is solid, has a rabid fan base, and is growing by leaps and bounds…but don’t buy it based on the idea that the AppleTV will be a DVR and knock Tivo out. The AppleTV will NEVER be a DVR. Want to know why? Well…here’s why I think Apple making the AppleTV into a DVR would be counter productive…
1. Not enough Hard Drive Space – 40 gigs is not enough to hold a signifigent amount of HD content, and Apple knows that. They won’t release a software upgrade making the AppleTV into a DVR if they can’t store enough content to make it worth while. It ain’t gonna happen. Could future AppleTVs ship with larger Hard Drives? Sure…of course they will, but that doesn’t change the fact that the unit they are about ship millions of, will not have enough hard drive space to get the job done.
2. Decreased iTunes Store Sales – If Apple turns their method of playing iTunes content into a DVR, then they’re sales for iTunes content will surely decrease.
3. Angry Hollywood Studios - Hollywood doesn’t like DVRs. They don’t want you to be able to get the content onto a hard drive for free, and they don’t want you to be able to skip through the commercials. If Apple created a DVR product that was in direct competiton to their digital downloads sales, which is what an AppleTV DVR would be, you will see studios less inclinded to deal with iTunes as a distribution method. Not good.
It seems very clear to me what the point of AppleTV is…to sell more iTunes content by getting your iTunes downloads onto your TV. Nothing more, nothing less.
Don’t buy stock thinking it’s going to be doing anything else. It is what it is…and it will be a success based on that, not on what it might someday be in the future.