Five Reasons Apple TV Won't Launch Until 2013

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Unless movie studios cave, we should stop getting our hopes up for an imminent release.
The tech world has been
running wild
with a cornucopia of stories surrounding Apple's
all but confirmed
television set. From
a la carte cable services
and
environmentally-efficient data centers
to
my own list of expectations
, Apple's mysterious TV is arguably the company's hottest unseen property. But while there are many signs that indicate an Apple-made television is indeed on its way, there are conflicting views as to when exactly that TV will arrive. Unfortunately, the 2012 release speculation might have been optimistic at best, if not completely unrealistic. Let's take a look at the reasons why Apple's
AAPL
debut TV might not arrive until 2013.
5. It's Just a Guessing Game
After Sterne Agee released a report yesterday morning, Benzinga spoke with analyst Shaw Wu to get some additional color on the proposed television. “I think what's different about our analysis versus the others is that a lot of people like to guess and speculate,” Wu explained. “We don't do as much of that. We like to base [our reports] on concrete evidence. Based on these issues, what we did say was that the timing is going to be difficult to pin down because a lot of this is based on third-party content providers in terms of what they want. We don't have a prediction. It's a pure guess.”
4. Don't Be Fooled by Bigger Stores
While one analyst
cleverly pointed out
that the Apple Store construction could be a sign that the company is preparing to sell larger products, such as new televisions, Wu isn't making that assumption. “The expansion of the stores could [involve] a variety of factors,” he said. “Frankly, it could be because [many of them] are too crowded.”
3. No Content, No TV
While Apple could feasibly manufacture and launch a TV in the next few months, the company cannot move forward until all of the content providers are on board with the Mac maker's plans, whatever they may be. This means dealing with NBC, which is now owned by Comcast
CMCSA
. This means talking to Internet skeptics like CBS
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CBS
, all the while trying to persuade boneheaded movie studios that think that
$60 movie rentals are a good idea
. “That's the challenge,” said Wu. “That's why we think this Apple TV is going to take longer than people think. The key to this is the content. The hardware/software, that's not the tough part. It's really getting the partnerships.” Wu noted that when Apple enters a market, it likes to do so in a big way. “[Apple likes] to do it in a unique fashion where you can show the user, the customer, that there's a big advantage in using Apple,” he explained. “If they went with the way things are today, they could do that as well. That's something that's on the table, from our understanding. So that could happen. But what they ideally would want to do is offer customized packages, because at the end of the day, that's what end users want.”
2. At the Current Rates, Broadband Channels Could Cost us Just as Much as Cable
During my discussion with Wu, I asked if Apple's rumored cable packages would save consumers any money if they still wanted the same number of channels that they get with Comcast or Time Warner Cable
TWC
. “I think the question is about choices,” Wu replied. “I suppose if the customer wants that, they can still get that. We don't think this is going to replace everything, just like Apple products today don't replace everything. The market is big enough. But there's a certain market out there who would want customized content, they could choose what they want, play it on any device that they have.” “Today you can't really have that,” Wu continued. “You can't watch your TV on any device at any time. I think a lot of people would love to have that and pay for it. One of the features Apple could offer is the ability to play that content on any device.”
1. Apple Could be Held Hostage by Broadband Internet Providers
The idea of a cable service that's
only
online should be very troubling to consumers. While everyone is quick to point out that the “Internet is the future,” few remember that Comcast and AT&T
T
are
milking the Internet
for all its worth. With monthly fees exceeding $40, data caps of 250 gigabytes, and harsh penalties for violations (including the potential to be permanently banned from using the service), broadband access is all cable providers need to prevent Apple from taking over the cable service market. Comcast has repeatedly stated that only a small percentage of its users reach or exceed the 250GB data limit. Whether or not that's true does not matter. Going forward, data demands are guaranteed to increase, but data caps are not guaranteed to increase along with that demand. Right now, if I leave my TV on all night, the only thing I have to worry about is my energy bill. I can have several TVs on simultaneously and, once again, my only concern is my energy bill. But if I were to replace my Comcast cable subscription with an Internet-only service, I would then begin to cut into my Comcast Internet data cap. We also have the issue of stability. When my Internet goes down, my cable service still works most of the time. The opposite is also true. If, however, my cable TV came directly through the Internet, I would need a steady, ultra-reliable connection to ensure that I never missed an episode of [enter great TV series here]. FYI: though I love Hulu, I use it for exclusives and for secondary viewings. I typically prefer to watch new shows the moment they air. I'm sure many of you feel the same way – especially those of you who enjoy live sporting events. I brought up all of these issues to Wu. “We don't have all the answers,” he said. “We're just saying that these are some of the issues on hand. “The reason we wrote this note is, frankly, a couple of my peers have been saying that this thing is on the verge of shipping. We just wanted to get people back to reality. We agree that content is the toughest part.” To be clear, I am not saying that Apple can't overcome these issues. But I firmly believe that, if Apple is going to offer a pay-per-channel service of any kind, it will do so in a creative and profitable way that will sidestep the threat of Comcast and other broadband providers, who will likely raise their Internet rates to compensate for the decline in cable service revenue. Unfortunately, this is one of the many reasons why a 2012 release date is extremely unlikely.
Follow me @LouisBedigian
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Posted In: TechAppleApple StoreApple TelevisionApple TVCBSComcastHuluNBCShaw WuSterne Agee
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