Apple TV Set-Top Box Predicted to Sell 4 Million Units, Grab 32% Market Share in 2011
Market research firm Strategy Analytics today reported on the release of its new research report covering “connected TV players” such as the current Apple TV and Roku boxes.
Context & Ripple Effects
Strategy Analytics' forecast lands a year after Roku's chief credited Apple's entry with doubling his own company's sales — evidence that the Apple TV launch grew the whole category rather than cannibalizing it. The firm now projects Apple taking 4 million units and 32% of the connected TV player market in 2011, from a standing start as a hobby-priced device.
The projection also frames what Roku has been building toward all year: a June hardware refresh, the $50 Roku LT aimed squarely at the low end, HBO Go coming to every box this month, and Angry Birds arriving on the platform — a price-and-content strategy running opposite to Apple's premium positioning.
First-order effects
- If the 32% share materializes, Apple ends 2011 as the volume leader in connected TV players despite a higher price point, validating its hobby-device pricing rather than forcing a repositioning.
- Roku enters 2012 facing a rival with double-digit share at triple its entry price, making its $50 LT tier and exclusive-feeling content adds (HBO Go) the load-bearing parts of its defense.
Second-order effects
- Content owners gain leverage: HBO Go's arrival on Roku shows networks can use streaming-player distribution as a bargaining chip, and Apple's scale gives it the stronger hand in those negotiations going forward.
- Price competition hardens at the low end — with Apple holding the premium segment, Roku and any imitators are pushed toward sub-$50 hardware margins, pressuring component suppliers and retail shelf economics.
Third-order effects
- The market is structuring into two camps — premium ecosystem devices versus commodity price-led boxes — which will decide whether share is won by hardware margins or by who controls the content relationship with the living room.
- A 32% first-year share for a device Apple still calls a hobby strengthens the case inside the industry that the set-top box is a beachhead for broader TV ambitions, raising the stakes for any full television product decision.
The trend: Streaming media players are splitting into a premium ecosystem camp led by Apple and a price-and-content camp led by Roku, with network licensing deals becoming the real battleground for living-room share.