Editorial: Five Reasons To Pass On Apple TV 2, For Now

Back in 2007, when Apple was hyping up the original Apple TV as a smart way to play iTunes content through televisions, we urged readers to be cautious in a series of editorials: our original take was “it’s nice, but,” followed by a more explicit “we don’t think Apple got it right this time”, and then a stronger suggestion: “hold off on this one.” Our recommendations came months before Apple started to downplay the device as a “hobby,” conceding that it hadn’t quite delivered the product people were looking for, and then lapsed into what became a pattern of modest software updates. As the second-generation Apple TV prepares to launch again this week, and Apple is once again trying to generate hype by giving units to friendly, less critical reviewers, we wanted to offer our honest thoughts on Apple’s latest endeavor into the living room—and why you might be best off saving your money for the time being. As in our prior articles, we provide counterpoints to each of these points for your consideration.

1. Apple’s Shipping An Incomplete Product (Again). Once upon a time, Apple used to chide Microsoft for releasing products that didn’t work fully on the day of release, requiring subsequent updates to perform as advertised. While Apple TV will arrive on day one with the necessary software to play content streamed from a computer or the Internet, its most intriguing feature—its ability to stream videos and photos directly from certain iOS devices—won’t be available until some point in November, when Apple releases iOS 4.2.

Counterpoint: Even though iOS 4.2 may wind up being a late November release—Apple typically releases things at the end of a promised month, not the beginning, or infrequently delays them—it’s not that far away. Until then, developer betas of iOS 4.2 may provide some insight into how well the feature works. Also, according to information Apple leaked to Fox News, the new Apple TV will temporarily offer iOS device music streaming using an updated version of its Remote application (version 2.0, released today), providing some relief for users, as well as a preview of AirPlay’s performance before iOS 4.2 comes out.

2. It’s Very Unclear How Well iOS Devices Will Stream Video to Apple TV 2. The new Apple TV relies upon “AirPlay,” an updated version of AirTunes, to stream videos and photo content from iTunes and certain iOS devices—some with 802.11n support, some without. Devices with older 802.11g hardware might or might not send smooth video to the Apple TV using AirPlay, and even iOS 802.11n devices differ enough in internal hardware that there may be some compatibility issues. iPads, for instance, work on 5 GHz 802.11n networks, while iPhones and iPod touches do not, so networking changes may be needed in some homes just to let the latter devices talk with the Apple TV, let alone send video to it.

Counterpoint: We won’t know for sure until iOS 4.2 is out, but we hope (and expect) that the feature will work well with all iOS hardware and networking environments. Apple would likely argue that buyers of most of its devices never expected to be able to stream video from them at all, so whatever they’re capable of is better than nothing.

3. Apple TV 2 Does Even Less Than The Version That Flopped—And Has Less Expansion Potential. Once in a while, Apple takes a product that’s doing pretty well and chops out a bunch of features, only to restore them in next year’s release. This happened in recent years with the iPod shuffle and iMovie, and like the just-released iPod nano, the second-generation Apple TV dropped some really big features this time. One obvious, huge omission is virtually all of the prior 160GB model’s storage capacity; the new Apple TV can’t store any content, which doesn’t just impact videos, music, and photos this time—it also limits the imagined potential of Apple TV 2 as an app and gaming device (discussed further below), while requiring users to keep computers or iOS devices turned on to provide access to their existing libraries of content. A more expensive version of Apple TV that adds back storage, albeit with iPod touch-like capacities, would be the most likely follow-up product.

There may be other, more subtle changes, as well. Will the new Apple TV be able to stream HD videos that were rented on a computer? This seems like it should be an obvious “yes,” but users of Apple’s iPad VGA Adapter have discovered that they can’t play back all the content they acquired from the iTunes Store, a problem Apple hid in Knowledgebase Articles and legalese disclaimers. Will iTunes Store content suffer similar restrictions in an AirPlay world?

Counterpoint: Unlike the iPod shuffle, iPod nano, and iMovie, which debuted at the same or higher prices than the better versions they replaced, the second-generation Apple TV sells for $99—less than half the cost of the prior model when it was discontinued. With some software tweaks, it may be able to rely on wireless networked storage other than a Mac or PC, such as a Time Capsule, which would be great. The addition of Netflix subscription streaming video also suggests that Apple may be moving in the direction of its many competitors, which offer multiple app-like options for accessing video and audio content from a variety of third-party sources, rather than forcing everything to be bought or rented through the iTunes Store.

4. The App Store’s Not Announced, Ready To Go, Or Likely In The Near Future. When the first Apple TV began to flag, Apple fans began to imagine all of the cool things the device could do with new accessories and software—some people even assumed that an ecosystem would develop around Apple TV because one had emerged for the iPod and iPhone. But Apple instead kept the Apple TV locked down, making only vague statements about its own free future software updates that would “surprise and delight” users. Since then, it has done little to pave the way for bigger developments on the new Apple TV; even if Apple wants to release an “App Store for Apple TV,” the current model will have little to no space for apps as we know them. Although adding an App Store would be a major step forward for the device, this doesn’t seem to be a priority for the company right now, and would require developer involvement that isn’t likely to start until Spring or Summer 2011, at the earliest. It might also require some changes to the device’s user interface.

Counterpoint: The Apple TV runs iOS 4.1, which means that developers will be able to rush applications out quickly in the event that Apple does announce an App Store. And there’s no doubt that developers would love to try.

5. Apple Still Views Apple TV As A “Hobby,” And So Does The Industry. The iPhone, iPod touch, and iPad have been huge hits for Apple over the past few years, and the company has devoted whatever resources were necessary to make sure that each product and its sequels were ready to launch on schedule every year. By contrast, Apple’s repeated description of Apple TV as “a hobby” isn’t just idle chatter—that’s code for “something that isn’t receiving Apple’s full attention and passion.” The software updates Apple has issued each year for Apple TV have been as much about fixing big interface problems as adding new features, and Apple has not enunciated any broad vision for growing the Apple TV as a platform. This year’s strategy is just “make it cheaper,” while competitors are offering comparable or better options at the same or lower prices. TV networks appear to be extremely reluctant to support the new Apple TV’s rental model, and some have been publicly negative about becoming involved.

Counterpoint: Apple’s approach this time is “go cheap,” and cheap alone is enough to sell some products… particularly ones priced at $100 or less. Once iOS 4.2 is out and Apple TV becomes useful as a wireless display option for iOS devices, it may just take off as an iPod/iPhone/iPad accessory, selling enough units that networks and developers will want to jump on board to support it—or future versions with on-board storage. Only time will tell whether the “hobby” becomes a full-time business or fades away.

Readers, what do you think? Are you going to buy an Apple TV this week, or hold off until it evolves into something else? We look forward to seeing your comments below.

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