Apple TV graduates from hobby/accessory to product line ahead of major changes
Apple appears to be putting its ducks in a row ahead of major Apple TV changes. Alongside last night's changes to the Apple Online Store to promote Valentine's Day specials, Apple added an entire Apple TV section.
Context & Ripple Effects
Apple's set-top box has been on a slow march out of the 'hobby' bucket for years: retailer moves at Amazon and Best Buy were read as signals of a refresh back in November 2011 (retailer changes hinting at a new Apple TV), followed by the 2012 model teardown comparison (the Apple TV (2012) vs. its predecessor). What is new this week is Apple itself changing the framing: the company added an entire Apple TV section to the Apple Online Store, formally merchandising the device as a standalone product line rather than an accessory.
The move landed the same week Apple reported a record $57.6 billion fiscal Q1 on iPhone and iPad strength, and it was picked up broadly — Variety, NYT Bits, ReadWrite, SiliconANGLE and others all ran the store-change story on or about January 28, 2014, which is unusual reach for what is technically a webpage edit. The breadth suggests the press reads it as positioning ahead of something larger.
First-order effects
- Shoppers browsing the Apple Online Store now encounter Apple TV as a top-level category alongside Mac, iPad and iPhone, which raises the device's visibility and gives Apple a dedicated shelf for bundles and promotions starting with the Valentine's Day specials.
- Retail and content partners reading the signal must plan around Apple treating the box as a first-class product line rather than a hobby experiment, changing how inventory, marketing co-op and app/content placement conversations are framed.
Second-order effects
- Streaming services and content providers competing for default placement on the device face a more prominent storefront gatekeeper — as Apple elevates the category, the economics of being featured versus buried on that shelf sharpen.
- Rival living-room devices (the Roku-style set-top field and console makers) now compete against an Apple product that the company is visibly committing to publicly, raising the stakes of their own 2014 roadmaps and pricing.
Third-order effects
- If the pattern from 2011's retailer leaks through 2012's refresh to today's storefront upgrade holds, Apple is building the commercial scaffolding for a much larger TV push, moving the living room from side project toward platform status — though what that platform looks like remains unannounced.
- A promoted Apple TV category also positions Apple to extend its existing strengths — the iTunes account base and hundreds of millions of credit cards on file — deeper into the living room, the same leverage it is reportedly laying groundwork to use in mobile payments.
The trend: Apple is incrementally upgrading the Apple TV from hobby accessory to full product line, with each storefront and supply-chain signal telegraphing a bigger living-room play.