This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Apple's TV Innovation Will Be Unexpected

Stocks in this article: AAPL GOOG

NEW YORK (TheStreet) -- Recently, a few articles have suggested that the window of opportunity for Apple's (AAPL) next generation TV project is closing. To make that assertion, it's necessary to have a comprehensive picture of the current technology, the roadmap for Apple's competition and keen insight into Apple's secret development work. Few have it all.

Even more ironic is that the very outcry for innovation by Apple is a call for something new and unexpected. How can one demand the unexpected and yet arrogantly claim that Apple's opportunity has disappeared? It's a contradiction.

Put another way, the window of opportunity for the Apple brand of exciting innovation, problem solving and elegant combination of hardware and software never closes. Ever.

Second Guessing Technology

In the past, we have seen how Apple provides solutions that seem oh-so obvious in hindsight. Yet when some observers write about Apple's future prospects, it's often in the context of competition and tech politics, not technology. Perhaps that's the only visible angle to approach Apple. That is, until the unexpected arrives.

That's why, when Apple does release a new product, the focus goes back, once again, to awe of the technical solution -- the very thing some observers hope Apple is working on but often neglect to explore.

A Technical Example

Here's a hypothetical example for how things could go, just for illustration. We start with the idea that Apple wants to control the whole TV experience and, perhaps, seize control of the final video feed on the display for technical and creative reasons. That means selling a full-size HDTV.

Who wants and can afford a large HDTV? Home and business owners. The home owners are older and have more available money (and space) than younger people. Older customers -- who appreciate well-crafted products -- aren't so adept at technology, so they have special problems, eager to be solved.

One of those problems is understanding how to set up and exploit all the apps and services that a modern smart TV can offer. Imagine this conversation with Siri.

  • Owner: I'd like to watch Netflix, Sherlock Holmes series three, but I don't know how to set it up.
  • Siri: I can set up Netflix for you. May I use your AppleID, credentials and credit card? I can create an encrypted, secure connection to Netflix.
  • Owner: Yes, please do that.
  • Siri: I'll email your new Netflix user ID and password to your iCloud email. Netflix is now launching. Searching for your show.

This is just an example. Apple starts with knowledge of the customer base, the customer needs and their typical problems. Then Apple applies technology to not only solve a problem, but create a better user experience. Remember, I'm not saying Apple would explore this particular idea. It's just an example of the process.

Thinking Deeply

Apple engineers think deeply about how to solve typical user problems. They try lots of different solutions and discard those that are unreliable or which create new problems. They have access to surveys like this one on consumer reactions to VOD. In contrast, remember the original Google (GOOG) TV in which we were expected to navigate content with a Chrome browser and an keyboard on our lap? It was laughable. And yet, Google TV was supposed to steamroll the current Apple TV product.

It could well be that a discussion of diminishing opportunity for Apple merely reflects a feeling of agitation and discouragement that a new toy from Apple isn't yet out there for the holidays, ready to be ogled, lusted for and written about.

Articles that talk about how some new product from a current competitor makes all unannounced efforts by Apple futile suggests that the competitors have done the hard work to solve major problems. Generally, they're not known for that.

Here's the difficulty. Without a broad understanding of the deepest consumer issues related to a next generation TV, anything that competitors throw out there seems to be a little better -- quite satisfactory really. It's all we have. Because it's difficult to imagine what Apple might do, and because Apple hasn't shipped yet, the competition's current products are often described by critics as sending Apple to its doom.

That is, until the unexpected arrives.

At the time of publication, Martellaro was long AAPL, although positions may change at any time.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs