Here’s Why Apple Would Be Wise to Stay Out of the TV Business

Carl Icahn makes a pretty compelling case for why Apple should get into the television market. The billionaire investor says people spend a quarter of their free time watching TV, and that the market, which he says is worth about $575 billion, excluding advertising, is more valuable than smartphones.

Sounds nice on paper, but the reality is that the economics of building a TV set are very different from those of mobile phones or laptops. The key difference is that the entire product essentially hinges on one component: the display. In many TVs, the screen accounts for about 80 percent of the production cost, according to data compiled by Bloomberg. In a smartphone, it's about 20 percent, says market research firm IHS, which leaves plenty of room to differentiate with other features.