DirecTV chairman Michael White isn't concerned about Apple releasing an HDTV and disrupting the status quo
When Apple first introduced the iPhone back in 2007, there were no shortage of naysayers and skeptics who doubted Apple had what it took to make a dent in the smartphone market. Interestingly enough, one of the more well known blurbs from those doubting Apple’s ability to succeed in the smartphone market was delivered in November 2006, less than two months before Steve Jobs actually unveiled the original iPhone to the world.
In late November 2006, Palm CEO Ed Colligan was asked by the New York Times about the potential for Apple to come in and disrupt the smartphone market.
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Colligan responded,
We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in.
And walk in they did.
Now, the next big product Apple is expected to unveil is an HDTV, and to that end, the skeptics are already starting to emerge – a funny dynamic and stance to have for a product that hasn’t even been announced.
In any event, during an investor conference in NYC last Friday, DirecTV chairman Michael White scoffed at the idea that an Apple HDTV would have a compelling enough interface and sufficient access to content to prompt users to get rid of their current cable service.
They are going to launch something, maybe in the next two weeks…but I don’t see media companies saying ‘You can stream things in bundles over the Internet.
Typically with technology, it smashes the cost structure in some new way (but) with content costs, rights fees and the cost of spectrum it’s hard to see (it) obsoleting our technology.”
And to be fair, I don’t want to lump in White with Colligan. There’s no denying that the HDTV market is markedly different and more challenging than the smartphone market ever was. More than that, the financials are completely different as well. The margins on HDTVs are typically razor thin and the upgrade cycle is rather infrequent.
To that end, doubting Apple’s potential in the HDTV market seems like a more rational stance to take when measured against the iPhone naysayers from back in the day. People were frustrated with their phones back in 2007. The same can’t be said of HDTV owners today.
One area where analysts believe Apple may make some inroads with an HDTV centers on content. Specifically, there have been reports that Apple is aiming to secure an HDTV with a’la carte pricing whereby users would only pay for the cable channels they actually watch. This proposition, however, is not without its challenges.
First, getting content providers to sign on board is challenging, and indeed, has been a consistent roadblock for Apple’s media content negotiation point man Eddy Cue. What’s more, the way content works in the cable industry doesn’t necessarily lend itself to a’la carte pricing to the extent that more popular channels like ESPN help subsidize some of the more niche channels. In other words, a’la carte pricing may not necessarily lead to cheaper monthly cable bills.
It remains to be seen if Apple has an HDTV in the pipeline, though the rumblings for such a product have been growing louder. And while there are many valid arguments to be made against the potential success of this endeavor, if history is any indication, it’s never a smart move to bet against Apple.
via Variety
