An app store for Apple TV? Apple TV APIs available for any developer to create apps? It was the biggest rumor that didn’t come to pass at this week’s Apple World Wide Developer Conference (WWDC). Despite this, there was still a fairly impressive list of announcements: iOS 6 with a virtual wallet app (Passbook), Apple maps with turn-by-turn driving directions, a new Retina Display MacBook Pro (yes, I want one) and an OS X Mountain Lion upgrade for only $19.99. So, where was the API for Apple TV?
GigaOm posted its analysis of why Apple took a pass. Their premise was that compared to Apple’s other product lines, Apple TV has a small install base. In another words, it’s too small of an opportunity for both Apple and its development community.
However, there have been over four million second and third generation Apple TVs sold to date. While the relative opportunity is small today, the potential opportunity is huge. In the stand-alone streaming player market, Apple is the market leader with the Roku trailing in second place. Perhaps Apple feels there’s not enough competition yet and it doesn’t need to make a move until it’s truly ready. Some folks thought Apple would never get in the phone business because of the small margins.
In my opinion, the primary reason for not launching an Apple TV app store yet is driven by marketing not technology. Apple does not want to steal any of the thunder from its yet-to-be-announced Apple HDTV. When you combine the total market space of streaming boxes and HDTVs, it’s truly enormous. Exhibit A that Apple is holding back was March’s Apple TV refresh. The third generation Apple TV was only an incremental upgrade. Its primary improvements were the bump in resolution from 720P to 1080P and a faster processor. One of the drivers for this was to keep up with the other upgrades in Apple’s ecosystem such as the iPad Retina display and AirPlay streaming in Mountain Lion. There was speculation that it would have Siri-like voice commands but besides a UI overhaul there was little else in new functionality.
Furthermore, the TV app stores that are out there now are disappointing. Outside streaming apps such as Netflix and VUDU, there are no real blockbuster apps in TV app stores. When was the last time you paid for an app in the Samsung or LG app stores? While the smart phone had apps like email, Twitter and Angry Birds, there’s been nothing as compelling in TV app stores.
I don’t think the lack of blockbuster app is due to a lack of imagination. Besides market fragmentation, one of the challenges has been the poor user experience. The HDTVs announced at CES came with an overwhelming number of control options. One living room device bucking the trend is the Xbox. With its Kinect motion and voice controls combined with its content deals, Microsoft is creating a compelling offering. However, Apple may not view the Xbox as competition as Tim Cook has stated he is not interested in the console business.
In it’s current incarnation, the current Apple TV doesn’t lend itself to lots of third party apps given the limited options to control it (though the iPhone remote is pretty handy). Given how Apple values the user experience, they have preferred to limit the apps on the box to a limited number of partners. I wouldn’t be surprised if we see HBO GO added to the current Apple TV.
For a TV app store to be successful, it needs to provide an awesome user experience and great content. As a product focused company, I’m sure Apple can create an amazing HDTV. The real question is can they cut the needed content deals to make it insanely great.