Apple (AAPL) has never been a company of modest ambitions. The iPod revolutionized the music industry, the iPhone essentially gave birth to the app economy, and the iPad gave legitimacy to the idea of the tablet computer. Don’t expect such big things from Apple TV.
The company’s Internet-connected gadget for televisions has many of the attributes of other successful products out of Cupertino, Calif.: simplicity, attractiveness, a very limited color palette (one, in this case). But it has been six years since the first Apple TVs were shipped, with barely a dent in television’s universe to show for it.
Bloomberg News reported Tuesday that Apple is close to a deal with Time Warner Cable that would allow cable subscribers to access channels through Apple TV. Time Warner Cable (TWC) is happy to make these deals; it already sends cable content through Roku and the Xbox (MSFT), and it plans to add service for Samsung’s (005930:KS)‘s Internet-connected televisions. But for a company such as Apple, the pact seems like small ball.
As I am an Apple TV-owning Time Warner Cable subscriber, this deal would keep me from having to press a single button on a remote control that switches the television’s input between my cable box and my Apple TV. That’s great in the sense that there’s a 15 percent chance that I know where my remote is at any particular time. On the other hand, all it does is replicate the functionality of a device that is already plugged into my TV.
In tech speak, the “battle for the living room” generally refers to the competition between companies such as Apple, Microsoft, and Sony (SNE) to sell customers an Internet-connected television device. But there’s also a fight brewing between viewers (who don’t want to pay so much for live television) and cable companies (which want to keep their customers and their high fees). With the notable exception of Aereo, which gives people access to broadcast television over the Internet, these companies are largely playing by the rules of the existing industry. (Bloomberg LP, which owns Bloomberg Businessweek, is an Aereo partner and offers its cable channel on the service.)
There was similar tension in the music industry 10 years ago when Apple came in and changed everything with iTunes. Of course, back then the recording companies were losing their shirts to file-sharing sites such as Napster and were desperate to recoup some revenue from digital distribution. In 2003 it was also harder to imagine how fundamentally the Internet was going to change the industry.
That’s not the case today. The incumbents are geared up for a fight to protect their territory. What’s more, people aren’t abandoning their cable accounts in the same way they have abandoned CD stores. So sure, Apple may want to revolutionize the way we watch television. The rumors of a more ambitious Apple TV device will almost certainly persist until the company actually releases a device that will do for television what the iPhone did to mobile phones.
If that day ever comes. For now, it seems that the cable companies have lulled Apple into a much less disruptive path.