Greg's Bite: No Margin, No Apple TV Set
TweetFollow Us on Twitter

Greg's Bite: No Margin, No Apple TV Set

Posted by Greg Mills

Those who predict Apple products tend to be wrong as often as they are right. Apple is famously secretive in its product development, for very good reasons. First the free publicity is worth millions when the curtain is drawn and months of speculation comes down to "oh, one last thing". If Steve Jobs had any fun in life that really mattered to him, it was in making monkeys out of the competition and us Apple tech writers in releasing the latest Apple device that we got wrong.

The second reason for the dark drapes of secrecy in Apple product development is that from the first products Apple put out years ago, the competition has reversed engineered or just plain stolen Apple's marketable ideas. Patents and trade secrets are the second line of defense as secrecy is the first. The competition hears about the latest Apple products at the public release and have no time to duplicate Apple products for some period of time, hopefully until the next version of the Apple device is ready to roll out.

The iPad is an example of the copy cats not keeping up. Just ask the "me too" tablet computer makers out there. By the time they even match the current hardware Apple has released a year back, Apple raises the bar again. "Flummoxed" is Steve Jobs word for the incredibly hard row to hoe Apple competitors face.

Thus, an early public release of Jobs plans for Apple to launch a full blown TV set runs counter to history. Steve knew his biography would be scoured by friends and foes alike for hints as to what is going to happen next in Apple's product line. With public crucifixion with rusty nails the penalty for leaking unreleased product information, would Mr. Jobs, himself publicly release Apple Television information a couple of years before the product is due to be released?

While the notion of a high end Apple HDTV set, created from scratch by Apple sounds incredibly cool there are interesting details that enter into the situation that in my mind run counter to the recent flood of publicity about Apple's TV plans being a foregone conclusion.

1. The margins on Apple products run much higher than any competitor. Apple has sharpened its pencil in supply chain purchases and due to being the largest consumer of electronic parts, they demand and get the first shot at using new parts and also get great prices due to volume and shear negotiation skills. HP decided to get out of manufacturing PS due to the approximately 7% margin common to the PC market. Apple has margins on the Mac of closer to 25%. Recently, HP announced that they might stay in the low margin PC manufacturing business after all. Flip, flop, flip... Sounds like NetFlix, managing their business by reacting to public outrage.

2. Steve Jobs indicated his breakthrough was in the control of HDTV content, which is in line with the current Apple TV product. Why not upgrade the Apple TV product to include DVR and cloud features that would make any HDTV work as in Steve's vision? The large HDTV LCD displays are expensive and now just a commodity item. Margins on large screen TVs run under 10% and the prospects some bloggers have suggested of Apple getting twice the going price for their TV products at retail is not realistic, in my mind. The only thing that would change the calculous would be a revolutionaly breakthrough in display technology that Apple owns.

3. What I think is coming is a tremendous upgrade to Apple TV that includes Apple magic in some sort of HD DVR that anticipates what you will want to watch and is controlled over the internet by Siri voice commands. If the new Apple TV box could replace all current satellite or cable boxes and get Apple into the big time in streaming video content, low margins in Apple TV products could be maintained, betting on the download generated profits. That would not require building and shipping large low margin TV display products. Apple wants to sell digital content as that is a long term income rather than a complicated high cost low margin product which runs counter to all we see Apple selling. The giant server farm Apple built will not stay idle, you can bet on that.

I could be dead wrong. I have been advised by my wife that there is a Greg Mills distortion zone, but she assures me I am the only one confused by it... Will I eat an Apple HDTV if they ship one? No, but I might buy one. I would certainly buy an enhanced Apple TV DVR product which I suspect is actually what is in the works. That is Greg's Bite

 
AAPL
$97.99
Apple Inc.
-0.39
MSFT
$43.50
Microsoft Corpora
-0.39
GOOG
$585.57
Google Inc.
-0.04

MacTech Search:
Community Search:

Software Updates via MacUpdate

Mellel 3.3.6 - Powerful word processor w...
Mellel is the leading word processor for OS X and has been widely considered the industry standard since its inception. Mellel focuses on writers and scholars for technical writing and multilingual... Read more
LibreOffice 4.3.0.4 - Free Open Source o...
LibreOffice is an office suite (word processor, spreadsheet, presentations, drawing tool) compatible with other major office suites. The Document Foundation is coordinating development and... Read more
Freeway Pro 7.0 - Drag-and-drop Web desi...
Freeway Pro lets you build websites with speed and precision... without writing a line of code! With it's user-oriented drag-and-drop interface, Freeway Pro helps you piece together the website of... Read more
Drive Genius 3.2.4 - Powerful system uti...
Drive Genius is an OS X utility designed to provide unsurpassed storage management. Featuring an easy-to-use interface, Drive Genius is packed with powerful tools such as a drive optimizer, a... Read more
Vitamin-R 2.15 - Personal productivity t...
Vitamin-R creates the optimal conditions for your brain to work at its best by structuring your work into short bursts of distraction-free, highly focused activity alternating with opportunities for... Read more
Toast Titanium 12.0 - The ultimate media...
Toast Titanium goes way beyond the very basic burning in the Mac OS and iLife software, and sets the standard for burning CDs, DVDs, and now Blu-ray discs on the Mac. Create superior sounding audio... Read more
OS X Yosemite Wallpaper 1.0 - Desktop im...
OS X Yosemite Wallpaper is the gorgeous new background image for Apple's upcoming OS X 10.10 Yosemite. This wallpaper is available for all screen resolutions with a source file that measures 5,418... Read more
Acorn 4.4 - Bitmap image editor. (Demo)
Acorn is a new image editor built with one goal in mind - simplicity. Fast, easy, and fluid, Acorn provides the options you'll need without any overhead. Acorn feels right, and won't drain your bank... Read more
Bartender 1.2.20 - Organize your menu ba...
Bartender lets you organize your menu bar apps. Features: Lets you tidy your menu bar apps how you want. See your menu bar apps when you want. Hide the apps you need to run, but do not need to... Read more
TotalFinder 1.6.2 - Adds tabs, hotkeys,...
TotalFinder is a universally acclaimed navigational companion for your Mac. Enhance your Mac's Finder with features so smart and convenient, you won't believe you ever lived without them. Tab-based... Read more

Latest Forum Discussions

See All

Urban Trial Freestyle Review
Urban Trial Freestyle Review By Blake Grundman on July 30th, 2014 Our Rating: :: RIDIN' DIRTYUniversal App - Designed for iPhone and iPad A rough ride that has trouble keeping its wheels on the track.   | Read more »
Take Note! Noteshelf Has Recieved a Big...
Take Note! Noteshelf Has Recieved a Big Update. Posted by Jessica Fisher on July 30th, 2014 [ permalink ] iPad Only App - Designed for the iPad | Read more »
Cubama Review
Cubama Review By Nadia Oxford on July 30th, 2014 Our Rating: :: TETRIIIIIS IIIIIN SPAAAAACE!Universal App - Designed for iPhone and iPad With its addictive challenge and interesting premise, Cubama is frantic screen-tapping fun.   | Read more »
Become a Guardians of Galactic Peace Wit...
Become a Guardians of Galactic Peace With the New Spacefaring Sim, Kairobotica. Posted by Jessica Fisher on July 30th, 2014 [ permalink ] | Read more »
Soul Guardians: Age of Midgard Review
Soul Guardians: Age of Midgard Review By George Fagundes on July 30th, 2014 Our Rating: :: SO MUCH GRIND IT CRUNCHESUniversal App - Designed for iPhone and iPad Swords and trading cards are fun, right? So is Soul Guardians: Age of... | Read more »
NFL Fantasy Football App Redesigned Ahea...
NFL Fantasy Football App Redesigned Ahead of Upcoming 2014 Season Posted by Ellis Spice on July 30th, 2014 [ permalink ] | Read more »
Matter Review
Matter Review By Jennifer Allen on July 30th, 2014 Our Rating: :: ORIGINAL PHOTO MANIPULATIONUniversal App - Designed for iPhone and iPad Matter lets you add geometric 3d shapes to your images and manipulate things so each image... | Read more »
Note Review
Note Review By Jennifer Allen on July 29th, 2014 Our Rating: :: TOO SIMPLEiPhone App - Designed for the iPhone, compatible with the iPad Note is a note taking app that’s a little too short on features to be worth its asking price... | Read more »
Chainsaw Warrior Goes on Sale & Ther...
Chainsaw Warrior Goes on Sale & There’s a Chance to Win a Copy of the Original Board Game Posted by Jennifer Allen on July 29th, 2014 [ permalink | Read more »
It Came From Canada: Tiny Tower Vegas
If you go to a casino, you might make a lot of money. If you run a casino, you’re guaranteed to make a lot of money. The choice seems pretty obvious. So while waiting for your shady real estate deals to move forward, get prepared with Tiny Tower... | Read more »

Price Scanner via MacPrices.net

13-inch 2.5GHz MacBook Pro on sale for $999,...
Best Buy has the 13″ 2.5GHz MacBook Pro available for $999.99 on their online store. Choose free shipping or free instant local store pickup (if available). Their price is $100 off MSRP. Price is... Read more
WaterField Unveils 15″ Outback Solo & 13″...
Hard on the heels of Apple’s refreshed MacBook Pro Retina laptops announcement, WaterField Designs has unveiled a 15-inch version of the waxed-canvas and leather Outback Solo and a 13-inch version of... Read more
New Roxio Toast 12 Delivers Digital Media Pow...
Roxio Toast 12 is a hub for sharing digital media to virtually any platform or device. has introduced two new additions to its Roxio Toast product family – Roxio Toast 12 Titanium and Roxio Toast 12... Read more
The lowest prices on leftover Retina MacBook...
Best Buy has dropped prices on leftover 13″ and 15″ Retina MacBook Pros by up to $300 off original MSRP on their online store for a limited time. Choose free local store pickup (if available) or free... Read more
Apple Updates MacBook Pro with Retina Display...
Apple today updated its MacBook Pro with Retina display with faster processors and double the amount of memory in both entry-level configurations. MacBook Pro with Retina display features a Retina... Read more
Up to $250 price drop on leftover 15-inch Mac...
B&H Photo has dropped prices on 2013 15″ Retina MacBook Pros by as much as $250 off original MSRP. Shipping is free, and B&H charges NY sales tax only: - 15″ 2.3GHz Retina MacBook Pro: $2349... Read more
Updated MacBook Pro Price Trackers
We’ve updated our MacBook Pro Price Trackers with the latest information on prices, bundles, and availability on the new 2014 models from Apple’s authorized internet/catalog resellers as well as... Read more
Apple updates MacBook Pros with slightly fast...
Apple updated 13″ and 15″ Retina MacBook Pros today with slightly faster Haswell processors. 13″ models now ship with 8GB of RAM standard, while 15″ MacBook Pros ship with 16GB across the board. Most... Read more
Apple drops price on 13″ 2.5GHz MacBook Pro b...
The Apple Store has dropped their price for the 13″ 2.5GHz MacBook Pro by $100 to $1099 including free shipping. Read more
Apple drops prices on refurbished 2013 MacBoo...
The Apple Store has dropped prices on Apple Certified Refurbished 13″ and 15″ 2013 MacBook Pros, with model now available starting at $929. Apple’s one-year warranty is standard, and shipping is free... Read more

Jobs Board

Sr Software Lead Engineer, *Apple* Online S...
Sr Software Lead Engineer, Apple Online Store Publishing Systems Keywords: Company: Apple Job Code: E3PCAK8MgYYkw Location (City or ZIP): Santa Clara Status: Full Read more
*Apple* Solutions Consultant (ASC) - Apple (...
**Job Summary** The ASC is an Apple employee who serves as an Apple brand ambassador and influencer in a Reseller's store. The ASC's role is to grow Apple Read more
Sr. Product Leader, *Apple* Store Apps - Ap...
**Job Summary** Imagine what you could do here. At Apple , great ideas have a way of becoming great products, services, and customer experiences very quickly. Bring Read more
*Apple* Solutions Consultant (ASC) - Apple (...
**Job Summary** The ASC is an Apple employee who serves as an Apple brand ambassador and influencer in a Reseller's store. The ASC's role is to grow Apple Read more
*Apple* Solutions Consultant (ASC) - Apple (...
**Job Summary** The ASC is an Apple employee who serves as an Apple brand ambassador and influencer in a Reseller's store. The ASC's role is to grow Apple Read more
All contents are Copyright 1984-2011 by Xplain Corporation. All rights reserved. Theme designed by Icreon.