Apple streaming = 2 parts content, 1 part hardware
Another one was published today. It is a continual stream of thoughts and articles around Apple’s upcoming streaming event. Every pundit and Street analyst seems to have a take on the topic. Some include economic models with possible subscriber numbers and revenue five years out.
It is all well and good, but they seem to be fixated on a head-to-head competition with the likes of Netflix. This battle royal would be fought with content, including original. If Apple wants to focus more on service revenue this story must be solely about content, no?
it’s all about content, stupid
Assuming it is all about content, many question whether Apple can compete. A recent Barrons’s note opined it would be a tough field to enter considering there are some pretty entrenched incumbents. Barron’s commented that it will be pretty hard to differentiate the service. Assuming Apple’s service is only content of some form, I tend to agree with the skeptics.
Yesterday, there was chatter about a streaming marketplace. The comment noted that Apple has been successful at marketplaces, including iTunes and the App Store. But, is that all Apple has to offer? Is there no hardware angle to this story? If there is a hardware angle, what could Apple do here? The pundits seem to infer all of this week’s hardware announcements were made ahead of time to get them out of the way of the new focus on services. There was discussion of speed bumps, better graphics and wireless charging, for the AirPods.
The Information ($) recently quoted Gene Munster: “Apple reinvents itself every 10 or so years,” and “A reinvention is going on now. It largely centres around services, including parts of AI, AR and healthcare.”.
It is time to start pulling these threads together.
Hardware is conspicuously absent from all of this chatter. Maybe people are too focused on services or they are still in the “why not switch to an Intel Celeron for the iPad” camp. Apple has always been a mix of hardware and software, and it has always used this mix as leverage to deliver a desired user experience. Further, over the last few years we have witnessed a wholehearted push into semi design. Apple has not only designed its on A-series processors, but is now incorporating is own designs in most of its products. So why does hardware not seem to enter the discussion?
Everyone agrees we will see a video a.k.a. content streaming service. So, it is worth asking where people will watch this content. Some will watch on laptops, phones and tablets, but many, maybe even most, are going to watch content on a TV. TV’s would seem to be at the pinnacle of consuming TV content. If people still watch TVs and the 25th is about TV content is it not odd that the Apple TV was not updated? It would seem to be the most obvious TV-based iDevice.
Apple made an unprecedented string of hardware announcements this past week, including iMacs, iPads and AirPods. Many commented that Apple wanted to get them “out of the way” before March 25th, before it moved its focus to streaming. It seems more likely that the iPad announcements were about getting these in place to be ready for the 25th; to be ready for streaming.
All of Apple’s iPads now sport and A12. It is the most recent A-series processor, and it has considerable compute power. The iPad Mini 4, or last version, sported a A8. So, yes there is a speed bump. Now, the Apple TV seems a bit of a relic with its A10X. So, if the AppleTV is upgraded to the A12 on Monday, to match the other devices on which one might watch TV content, what does that give us? What does the A12 bring to the equation and what might Apple do with it?
Part II … A12 not just a speed bump