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!

Is an Apple TV the Next Big Innovation?

NEW YORK (TheStreet) -- Yesterday on TheStreet, I read Rocco Pendola's Apple Must Do a TV. In a nutshell -- or in his words, in the shell of a nut -- Pendola says that Apple (AAPL) would be more likely to succeed by focusing on a TV than the iWatch. 

I couldn't agree more. While I'm not against the iWatch -- because it is likely to account for some revenue -- it won't be the game-changer that investors want. 

It's really hard to introduce blockbuster product after blockbuster product. And growing revenues at a high rate for a company Apple's size isn't exactly a piece of cake either. Apple shares opened today at $530 even, down 5% year to date but up 17.8% over the past year.

I wholeheartedly agree that Apple could revolutionize the living room. But whether that's done solely with a physical TV is the real question. 

My biggest concern has to do with product turnover and the replacement cycle. Unlike smartphones, there's no need to upgrade to a new TV every couple of years. Once a consumer buys a TV, the product generally lasts a long time.

For example, I've had at least three or four different smartphones in the same time that I've had one TV. As Apple is known for its superior, high quality products, why would I need to replace an Apple TV five or 10 years after I buy one? 

Second, as television prices continue to sink, how will Apple be able to maintain its typical expensive prices? I don't know that Apple could. It would result in a direct hit to margins if the price of the company's TV set declined. 

Still, the living room has a lot of potential. It's not really being tapped by Netflix (NFLX), nor by Google (GOOG) with its Chromecast. Slingbox and Roku have made a few advances, as has the current Apple TV, but nothing that should be a considered a blockbuster revolution by any means. 

Nearly all of our devices -- smartphones, tablets, computers, MP3 players -- have advanced incredibly over the past decade. But with the exception of quality, the TV, and more broadly, the living room, has hardly changed at all in the last 20 years. 

Apple needs more than a TV set. Incorporating Siri, along with the iPhone and iPad as a remote would be nice. But there needs to be a way to turn the TV into something more. 

And I don't mean connecting to Netflix, Hulu or Amazon (AMZN) Prime video either. 

1 of 2

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!
DOW 17,098.45 +18.88 0.11%
S&P 500 2,003.37 +6.63 0.33%
NASDAQ 4,580.2710 +22.5760 0.50%

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