A View from David Zax
Apple Testing TV Designs
WSJ reports Apple to be in an early stage of testing with Foxconn and Sharp.
The Wall Street Journal reports that Apple is collaborating with component suppliers to test TV set designs. Though rumors have long been sprouting about an Apple television set in the blogosphere, a Journal report has a different pedigree. As The Verge puts it, it’s “often the first sign that Apple is serious about a new product.” Still, one of the WSJ’s sources cautions: “It isn’t a formal project yet. It is still in the early stage of testing.”
Reportedly Hon Hai, the parent company of Foxconn, is collaborating with Sharp on the TV set design. Foxconn and Sharp already have close ties, with the chairman of the former having taken a large stake in a Sharp LCD factory back in July (that factory is “particularly suitable for making LCD panels 60 inches or larger for TV sets,” notes the Journal). Apple’s M.O. is usually to test products internally first, then begin collaborating with suppliers later. Still, cautions the Journal, Apple might “decide not to proceed with the large-screen set.”
Apple CEO Tim Cook has taken to the airwaves of late to suggest, through half-closed lips, a heightened interest in TV (see “Made in USA: Your Mac?”). He has said of the current set-top Apple TV that it’s more of a “hobby,” suggesting larger ambitions in the TV space might come later. And he told NBC News that taking a deeper look at transforming TV is “an area of intense interest.”
The real challenge for Apple getting into the TV space has much more to do with negotiating with content providers, and relatively little to do with hardware, of course (see “The Gordian Knot of Television”.) The Journal also reported on an uptick in Apple’s talks with media partners as much as a year ago.
To conquer the living room could be an extremely lucrative proposition for Apple–or its competitors. A recent report from Goldman Sachs explained why the living room was likely to be a next frontier for Apple. An average 46-inch set costs three times that of a smartphone, and though TV’s turn over less readily than a smartphone, a TV purchase could actually determine other future gadget purchases, since consumers will likely want their phones and tablets to match their TV. A TV could be something of a flagship, indeed, for an entire family’s technology choices; a head of a household buying an Apple TV might be influencing all of her children to buy iPhones for years to come (see “Your iPad Could Be Your TV”).
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