What's a matta? Can't a guy have "intense interests?" Does he have to actually go (to China) and make an actual TV? If that guy is Tim Cook, then yes, a lot of people are expecting an actual TV set from Apple someday soon. Gene Munster of Piper Jaffray has been predicting one since 2009! (He has since pushed his prediction back until November 2013.)
In his interview on NBC's Rock Center with Brian Williams yesterday, Tim Cook again addressed the chimerical Apple TV, "It’s a market that we have intense interest in, and it’s a market that we see that has been left behind." When pressed by Williams, Cook shifted the subject to nostalgia:
BRIAN WILLIAMS: What can Apple do for television watching? What do you know that is gonna change the game, that we don’t know yet?
TIM COOK: It’s a market that we see, that has been left behind. You know, I used to watch “The Jetsons” as a kid.
BRIAN WILLIAMS: Absolutely.
COOK: I love “The Jetsons.”
BRIAN WILLIAMS: I was right there with Elroy.
TIM COOK: We’re living “The Jetsons” with this. [showing an iPhone 5]
BRIAN WILLIAMS: Facetime is “The Jetsons” but television is still television.
COOK: It’s an area of intense interest. I can’t say more than that. But …
Williams persisted and asked Cook to complete the sentence, “Ten years from now, Americans are going to be amazed that they ever ___” But, instead of anything specific, he parroted the Steve Jobs chestnut, "Our whole role in life is to give you something you didn’t know you wanted. And then once you get it, you can’t imagine your life without it.…And you can count on Apple doing that."
The only actual piece of news in the twenty minute interview (link to unauthorized video on TAUW) was Cook's announcemnt of Apple's $100 million investment to manufacture a line of Macintosh computers in the U.S. As welcome as this news is (The New York Times gave it front page treatment), corporate watchdog Taren Stinebrickner-Kauffman of SumOfUs.org called it (unsurprisingly) a "PR stunt," and noted that, "They’re talking about moving 1/10th of 1 percent of their global production costs."
Williams expressed mock frustration at Cook's evasions (he knew the ground rules) but consumers have a legitimate right to understand what the hold up is for the next Apple TV product. There is a good case for it being an improved "puck" or set top box, as opposed to a complete TV. As Brightcove's Jeremy Allaire predicted back in June, and reprised again in a conversation with me yesterday, Apple will come out with a "commodity add-on peripheral," that will cost around $100, like the current "puck." He visualizes it as perhaps 3/4 of an inch tall and deep and six inches wide, "that can easily mount to the top of almost any existing HD capable TV set," he wrote on All Things D. "Like the existing Apple TV, it will have HDMI and power jacks on the back, but it will also include a high-def camera built into its face, as well as an embedded iOS environment that provides motion sensing and speech processing.”
I think it is a fair assumption that the hardware already exists to make TV an Apple-grade user experience. And there is no reason that Apple will not make an actual TV as well, but the big play for market share will come from the peripheral. Much of the speculation about the delayed introduction of a next generation Apple TV product has focused on the inertia of the cable companies and other content providers. As many have noted, unlike the music industry, the TV business model is not broken, so Apple's leverage is limited. The recent speculation that Apple will move into the set top box business in partnership with one or more of the cable operators sounds like a logical way around this impasse.
But I see the real difficulty in the software of curation and discovery. No one has solved this problem in a satisfying and robust way. Not Apple in their App Store, not Netflix in their movie recommendations, not Amazon at a level of simplicity that will work for people on couches in front of their TVs, and certainly not the cable companies. The big argument for the persistence of the cable bundle of channels (few of which any given subscriber ever watches) is that it sustains niche channels that consumers would miss if they disappeared from lack of subsidy.
This is really a "long tail" problem. All of the attention goes to the "tall neck" of popular programming and little to the more specialized offerings that are harder to find. This is particularly a problem for families who might want to all watch the same program at the same time, but cannot find anything (without great effort) that everyone is happy with. So, even if the "modern" family is all together in the living room with the big TV on, each family member is also on their own device, looking for something of more personal interest than what might be on the big screen.
The model of a group of people armed with mobile devices in front of a large central screen is very promising for collaborative ventures, whether they be games, groupware for business, interactive learning programs for schools—or solving the curation problem. My guess is that if it is done right, collaborative filtering of content can expose the long tail better than the current cable bundle, at which point Apple (or some other company) would really have something to talk to the cable companies about.
So this is also a "chicken and egg" problem. In order to deploy effective discovery software, there needs to be a large enough traversable content model to create a satisfying experience. And the cable companies will resist until such software is proven in the wild. Catch 22. The real point, of course, is to satisfy the customers and make them happy to pay for the cost of programming. Once the app model takes hold, some people will start playing with their content options at a level of granularity that will make the DVR look like a blunt instrument. Others, of course, will continue to be spuds, and any robust solution has to work for that wide a range of users.
Some software startup may have an edge here over Apple, Google and the other big players with mountains of big data at their disposal. As I have been writing recently, well-connected "little data" is better at solving some problems than "big data." Most current "deep learning" systems rely on the kind of highly vertical structure argued for by Ray Kurzweil and other tech luminaries. But problems of curation require intense amounts of "horizontal" activity within a certain content domain. Indeed, first complexity needs to be reduced in order to make a clear model of whatever you are trying to evaluate before you can use those mountains of data effectively.
A TV app marketplace will be great at developing all of the different kinds of approaches required for different content types and different types of viewers, and Apple has an undisputed edge in setting up these kinds of channels. But the basic software that creates a framework for successfully navigating these content spaces may require a kind of intelligence that Apple does not yet possess. The nut may have been "cracked," but it has yet to be split open.
What was notable in the video of the Rock Center interview (that doesn't come across in the transcripts) is how Tim Cook's face lit up when he expressed his "intense interest" in the TV market. Clearly, something is in the works. Let's see if Apple can surprise and delight us again (but I'm not holding my breath.)
– – – – – – – – – – – – – – – – – – – –
To keep up with Quantum of Content, please subscribe to my updates on Facebook or follow me on Twitter.
