Analyst: Apple’s $3.9B investment means Apple television on the way

February 4, 2011 8:13 AM
Devindra Hardawar

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San Francisco, CA

Apple fanatics may have something new to get excited about. In addition to the iPad 2 and iPhone 5, they can now expect an Apple television, according to Piper Jaffrey analyst Gene Munster.

Specifically, Munster believes that Apple’s mysterious $3.9 billion component investment is all about securing displays for its products (very likely), and that it also hints at the company’s interest in a television of its own, Apple Insider reports.

Munster has been saying for years now that Apple will release an Internet-connected TV by the end of 2012, but the evidence has always seemed paper-thin. That’s no different now. Apple is currently a display-hungry company. All of its best-selling products rely on high quality displays, and it’s also one of the few buyers of high-resolution mobile displays like the one used for the iPhone 4’s “Retina” screen. And considering that the iPad 2 will likely also call for a higher quality screen, it’s no big surprise Apple would want to secure display supplies — especially since shortages of OLED displays have plagued cellphone manufacturers for years.

VentureBeat’s own Dean Takahashi has argued that Apple should build its own TV, but I still don’t see it. For one thing, consumers don’t purchase televisions like they do other electronics. While most consumers replace their phones and MP3 players every two to three years — something that greatly benefits Apple — TVs generally get used for much longer. That’s especially the case now that consumers are purchasing large HDTVs. There has to be a compelling reason for those consumers to upgrade their televisions, and I don’t think the promise of an Apple connected TV is enough.

Apple would be better off focusing its energy on the new $99 Apple TV, which has sold like crazy, even though it still lacks support from CBS and NBC for TV rentals. The addition of Netflix streaming video playback, plus its new lower price, has made the Apple TV a hit with consumers. Still, there’s room for growth. Apple needs to add apps to the platform, and forge more deals with content providers, to truly take advantage of the Apple TV’s potential.

http://twitter.com/pbreit Patrick Breitenbach

I am as die hard Apple as they come and I am not sure what would prompt me to buy an Apple television.
http://www.devindra.org Devindra Hardawar

Exactly. It would be an ordeal for them to design and build a TV, and many consumers would still likely opt for cheaper sets from other companies.
http://analytikainc.com/blog/ John R. Sedivy

While I agree that people don't replace their TVs as often as computers and phones; I think if anyone could drive consumer behavior in this way it would be Apple. Imagine if they could continually improve upon the TV concept while continually lowering price for wider adoption across the consumer market. Apple really disrupted markets with the iPod and iPhone, maybe another market disruption is in the making.
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