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AppleTV + Rentals Is The Big News

Posted by: Arik Hesseldahl on January 15

Just back from the keynote, and I’m convinced that AppleTV and movie rentals was the major headline today, trouncing even MacBook Air (cool as it is, um…wow) as the major strategic announcement today.

This little box is suddenly capable of all the things the 21st century media consumer has been fantasizing about. Now you can sit on your couch and, rent (but not buy) a movie, buy a TV show, buy a song, listen to or watch a podcast. Some of those movies will be available in HD. And yes, there are limitations: You have to wait 30 days after the DVD is first released, but big deal, and Cliff thinks that’s going to be an important weakness. I disagree. In time if sales are sufficiently strong, that delay will simply cease to exist because of market demand. There were limitations with the iTunes store when it first launched: there was nothing on it. Maybe 300,000 or so. Now there’s 6 million songs.

If I were an executive at Amazon or at Netflix, or Blockbuster hoping to build up a digital distribution business, I’d be buying Maalox today, because Apple has just trounced them all.

No longer is the AppleTV an oddball little device that only a digital media geek could love. No longer is there a connection between the set top box and the computer to negotiate. It’s connected directly to the Internet.

Companies large and small have been struggling for about a decade to find a way to bridge that gap between the computer — that repository of all digital media — and the TV set in the living room. At a single go, Apple has broken all the major walls that have made this difficult. At the same time, they’ve got the studios involved providing the all-important content they’ve to now been reluctant to make available. Apple today launched its second major attack on the media business. After less than five years it has become the third-biggest seller of music. In five years it could do the same thing with movies and TV shows.

One feature I do want that’s not there: Internet radio. I love the 1,700+ stream radio stations that iTunes provides. An easy upgrade for the future. I’d love to be able to listen to KCRW in Santa Monica, Calif. from from my apartment in New York over the nice speakers in the living room.

I initially expressed reservations about AppleTV when it was first announced, and have so far not opted to buy one. Now I don’t think I can be talked out of buying one. I doubt I’ll be alone. The days of there being “nothing on” your TV set are effectively over.

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Reader Comments

Mark Silverman

January 15, 2008 06:58 PM

The new software for the Apple TV (2) set top box brings us the long-awaited desktop/livingroom convergence, while the studios bring the goods people will pay for. It's truly great, until someone else makes it even easier, like Comcast or Cablevision. All cable needs is an on-screen user interface as slick as Apple's, with a wifi or USB dump for portability, and it's their trump of Steve Jobs. Any studio exec knows distribution is where the muscle is, but content is and always will be king to the end user. Consumers buy entertainment, not technology. Don't get me wrong, I'm a big Apple fan, and have owned nothing but Macs since 93, and am invested in the platform. But if Brian Roberts or the Dolans build wifi and a hard drive into the cable modem already inside my house, and the cablers and Apple are offering the same content, it's a race of scale. And cable is already there. If the technology's ease of use is equal in the consumers mind, the winner's going to be the one with the wire already inside the house. They've already got 1 box, and the remote. Too bad the phone companies got to the game late; they were the first one's with a wire in 95% of homes.

Steve Anderson

January 15, 2008 11:29 PM

I guess the point is Mark that the cable companies haven't come out with such a product yet. Just like the Japanese electronic companies didn't come out with an ipod before the iPod, or the nokias of this world didn't not come out with an iphone before the iPhone.

Apple's biggest strength is its software expertise.

While I have liked the Apple TV concept from day one, and expect the ability to rent directly from the device only to increase its appeal, the problem I have with the Apple TV is it's like a heater. Put your hand on top of one and you'll know what I mean. This was the reason I have yet to buy one.

Also, there seemed to be no ability to turn the device off or put it to sleep without turning it off at the wall.

Olaf Odlind

January 16, 2008 04:40 AM

Cable won't give you HD will it?

solomonrex

January 16, 2008 10:21 AM

All my music and podcasts are on the Apple TV. Plenty of people switch away from cable to satellite and vice versa, or cancel altogether. No one I know switched away from Itunes and ipod.

If they can add more TV shows to their video podcasts, I would basically give up on cable entirely. Itunes is easier than DVR, and there are free HD programs. The only problem is sports programming, which isn't offered digitally without horrible restrictions.

Juan Ramirez

January 16, 2008 04:05 PM

If it could only TiVo, then it's a go!

Dion Smith

January 16, 2008 07:16 PM

Owned the Apple TV and utilized it, but the new enhanced software functions bring in the wow factor. Too bad jobs didnt include an option for a cable card (required for all cable to companies to provide) for tuning and recording. That would provide a truly seamless solution.

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A blog on the daily doings of Apple and the many companies in its orbit, with insight and analysis by two longtime Apple-watchers BusinessWeek Senior Writer Peter Burrows and BusinessWeek.com Senior Technology Writer Arik Hesseldahl.

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