Claims that Apple is developing a gaming system of its own are false, according to a games development magazine, but the electronics firm is also reportedly willing to bring games to the iPhone and iPod touch.
Instead, the iPod remains the "gateway" for all of Apple's gaming efforts, the contact says. Marketing is said to be one of the primary motivations, as discussions between the company and third-party software teams reveals that the device maker wants to avoid diluting its brand with risky new products.
"Apple is very protective of the reputation it has built in the electronics market," the reported insider says.
From a technical standpoint, the company also purportedly sees the iPod as "powerful enough" for games. The OpenGL ES (Embedded Systems) software library at the heart of modern click wheel iPods is efficient enough for Apple's aims that it doesn't need a faster device, according to the tip.
Apple is under little pressure to change its existing business model for games, which revolves around granting a handful of top-tier game producers such as EA and PopCap enough access to develop games sold through iTunes. Feedback from these partners is said to be very positive, with Sega having praised the content delivery system in a recent issue of MCV magazine.
The source suggests that Apple would rather expand its existing game library for iPods -- and add games to the iPhone and iPod touch. The tipster does not directly confirm development of games for the two touchscreen devices, however. To date, both premium handhelds have largely been excluded from Apple's fledgeling gaming efforts due to their incompatibility with older iPods' operating systems and their radically different control schemes.
Whether Apple will officially expand its game development and include native games for the iPhone is unknown, though more light is likely to be shed on the possibilities when Apple unveils details of its iPhone Software Development Kit later this month.
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Mike Shinoda, front-man for the Grammy award winning group, revealed the plans in a brief message to his fans on Monday, in which he also acknowledged receipt of the band's second "ECHO" award -- the German equivalent of a Grammy.
"Looking forward to our first show at Madison Square Garden this week (sold out)!," he wrote. "Also, look forward to a special show that we�re doing in NYC in conjunction with Apple�shh�it�s a secret�"
Linkin Park is currently in the middle of a nationwide tour with special guests Coheed & Cambria, and Chiodos. The band will be playing tonight in Baltimore, MD before its show Thursday at Madison Square Garden in New York City. It will then head south for shows in Lexington, KY and Nashville, TN on the 25th and 26th, respectively.
It's unclear whether this "secret" New York City event has anything to do with a an Apple product event rumored to take place during the final week of the month. The company, however, has yet to issue any form of invitation or acknowledgment of such an event, suggesting one is increasingly unlikely during that timeframe.
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The diminutive device is just half a cubic inch in volume, weighs just half an ounce, features an aluminum design with a built-in clip and comes in five colors-silver, blue, green, purple and a (PRODUCT) RED special edition.
"At just $49, the iPod shuffle is the most affordable iPod ever," said Greg Joswiak, Apple's vice president of Worldwide iPod Product Marketing. "The new 2GB model lets music lovers bring even more songs everywhere they go in the impossibly small iPod shuffle."
Apple's refresh of the shuffle comes amid analyst reports which place a large part of the blame for recent iPod demand softness on the aging shuffle line, which hadn't received a material update in nearly 18 months.
"While virtually 100 percent of the unit shortfall was in the low-end iPod Shuffle, allowing Apple to beat consensus iPod revenue despite the unit shortfall," Citigroup analyst Rich Gardner recently wrote in a research report covering Apple's fiscal first quarter results. "We believe the unit shortfall reflected the lack of a compelling update to the Shuffle product last Fall; the Shuffle simply was not the compelling 'stocking stuffer' this year that it was last year."
Pricing or a Windows PC with a USB 2.0 port and Windows Vista or Windows XP Home or Professional (Service Pack 2) or later and iTunes 7.4 or later.
* An EFI firmware update.
* A firmware update for the Apple TV's HDMI video hardware that enables 1080p output through upconversion.
* The new Take Two menus and interface with support for HD downloads, rentals, AirTunes and more.
HD: 720p vs 1080p
Apple TV is essentially a low end Mac with a video card supporting 1280x800 resolution. The existing hardware will never be able to decode or output 1080p video in full native resolution. However, the new Take Two software enables 1080p output in the unit's HDMI subsystem to scale up its 720p content and deliver it as a 1080p signal to TV sets that support 1080p display.
This is similar to what upconverting DVD players do, although Apple TV can start with higher resolution content; Upconverting DVD players deliver the standard definition content on DVDs to HDTV sets as an HD signal. This doesn't invent new detail in the picture, but does deliver the best possible picture DVD can produce because it maintains a high quality signal to the set rather than delivering one that must be scaled up within the TV itself.
Apple TV plays back iTunes HD content, HD home videos, and HD podcasts all at 720p internally, but can deliver either a standard 720p signal or an upconverted signal to the HDTV set as 1080p. How noticeable this difference is in the picture displayed depends upon the quality of the video circuity in the TV being used. Many consumer oriented HDTV sets use cheap picture scaling and conversion hardware that will result in the Apple TV's new 1080p mode serving as a nice feature, as the TV won't have to handle the conversion itself.
Using a high quality HDTV set, we couldn't see any visible difference in using 1080p over 720p from Apple TV, even when looking up close and trying to find differences in the static frames of movies or in the unit's own menu titles. However, some cheaper HDTV sets might deliver a better picture using the 1080p signal setting. Rather than being excessively concerned about 720p versus 1080p, the main value added by Apple TV is its low cost delivery of easy to access HD content, both for rent and for free.
Apple TV versus HD Broadcast and Disc
HDTV and HD disc vendors are working hard to convince users that 1080p is the Only Real HD, and that 720p is far inferior, but for owners of sets smaller than about 50" the difference won't even be visible to anyone watching from ten feet away. Additionally, there is no 1080p content being broadcast. Broadcast HD often looks the best. Cable, satellite, and over the air providers, however, all deliver 720p or 1080i that often looks the least impressive because the providers employ strong data compression to shove as many channels of HD as possible through their pipes. Regardless of the nominal resolution used, high compression can result in blocky screen artifacts.
All HD broadcasts are not alike either; many sports events are broadcast using a higher quality signal with less compression, which makes for a very impressive picture, while other HD channels are heavily compressed to the point where their HD resolution becomes overshadowed by a compression artifacts. While pundits like to compare simple numbers, the real factor in enjoyable HD content is how well content providers balance their resolution format with compression settings that deliver a detailed, smooth, high quality picture. Every link of the HD pipeline--from the capturing camera to the transmission delivery, receiving set top box, and TV circuitry--has to be strong enough to deliver a picture that stands up to what the new HDTVs can produce.
Ignoring all those realities to obsess over the nominal resolution of a video signal does nothing to improve the picture users actually see. The HD disc market faces fewer problems than broadcasters because formats like Blu-Ray have a huge capacity and movies are mastered and optimized for picture quality rather than delivery efficiency. So far however, as noted in Why Low Def is the New HD, the market has demonstrated that most users are more interested in a wide screen display and a sharp picture at a reasonable price than in specification number details. Apple TV targets the current market demands to offer a product intended to deliver usable functionality rather than specification bragging rights.
HD vs Non-HD
While videophiles like to obsess over the numbers that make "real HD," the reality is that most TV watchers are so used to poor quality standard definition programming and that any improvement in picture quality is a dramatic change. Analog broadcast TV has long used a nearly square aspect ratio that is stretched out by non-square pixels that results in everyone on TV looking ten pounds heavier. It also has poor color and poor effective resolution, delivering an interlaced picture with roughly 200 to 400 lines of resolution.
Enhanced definition, 480p EDTVs presented improved picture processing and widescreen aspect ratios, and the current crop of HDTVs greatly improve the overall picture quality through an improved picture resolution of 720p or 1080p. Paired with iTunes' "near DVD" quality movies, the original Apple TV software delivered a decent picture on wide screen EDTV and HDTV sets, although its limited resolution 480p movies were no match for the new HD disc formats.
However, consumers haven't been buying the new HD disc formats, much to the chagrin of the companies working so hard to push them. In part, that's because of the format war between Sony's BluRay and Microsoft's HD-DVD, but the main reason why both formats have barely sold a million standalone units a year is the cost involved. Rather than investing in either new HD disc format, consumers have instead been buying upconverting DVD players, which allow them to watch their existing DVDs, as well as the wider variety of DVDs on sale and for rent, on their new widescreen HDTV sets without a significant enough difference in quality to push them toward getting an HD disc player.
Consumers' preference for spending their money on upconverted DVDs is good news for Apple's strategy with iTunes and Apple TV, which aims at delivering easier access to high quality HD content at a low price and without any subscription fees. How well has Apple done in delivering upon this premise?
Apple TV Reborn
In its first incarnation, Apple TV acted as a standard definition iPod appliance that could sync media from an iTunes PC on the same network, and upconvert the signal to widescreen EDTV and HDTV sets. Consumers had a number of reasons to pass on the product:
* While the device had the inherent capacity to play HD quality video, Apple didn't provide any sources of HD content within iTunes.
* While it also had the hardware to deliver digitally encoded surround sound audio, the software didn't make it easy to coax out, and iTunes content only supported simpler Dolby Surround audio.
* The interface provided rough playback control using the IR remote, making it hard to accurately fast forward though a scene.
* All content on the device had to be selected and set up from iTunes on another computer and then synced over.
The new Take Two software solves issues with Apple TV's untapped hardware, greatly improves the overall interface usability, integrates the system directly with the iTunes Store for living room access to both purchased and free content, and adds a number of other new features. The new software transforms the unit to the point where its almost hard to talk specifically about new features; nearly everything is new. This really demonstrates the power of software to dramatically enhance the features of hardware; existing Apple TV users will be happy to find that their existing device not only sings with the new update, but that it also costs nothing to upgrade.
Apple TV's New Interface
The previous Apple TV interface borrowed heavily from Front Row, presenting menus of different kinds of content or functionality, each associated with a big icon: Movies, TV, Music, Podcasts, Photos, YouTube, and Settings. The new version presents a simplified navigation launch screen using a two column menu (below). The first column lists major feature categories, and the second column lists a submenu of related options.
After selecting a submenu option from the second column, the two column menu zooms out and drops you in a specialized interface customized to what you've selected to do. This seems confusing at first, because each submenu has its own interface style. It also seems like you are alternating between the old and new Apple TV interface menu styles, because the plainly textual launch menu shares little resemblance with the four other more graphically-oriented menu screens.
Submenus that present lots of options to browse from (such as the Settings menu or My Movies, Genres, and Trailers in the Movies menu) bring up a listing familiar to veteran Apple TV users, with a single long column of items to the right of a detail area that shows cover art, a synopsis and other details. Some of these menus present additional submenus in same style as the previous software version.
A second, new graphical selection menu screen style is presented for displaying live content from iTunes. Selecting Top Movies or All HD from the Movies menu (or selecting a listing from the Genres submenu) brings up a screen full of artwork graphics that can be used to rapidly browse and select items to bring up a full screen display of their related details and download options. Items in rows cycle in from the right similar to Cover Flow.
A third submenu style relates to searching. Movies, Podcasts, Music from iTunes can all be directly searched for using an alphabetical listing targeted by the remote as if entering your initials for a high score in Pac Man. Search results bring up smart listings that identify any word in the name of a movie, making it easy to find a title even if you can't remember the entire name (below).
Other submenus bring up specialized menus for setting up and using .Mac Web Galleries, Flickr albums, YouTube videos.
None of this is too difficult to figure out, but it does seems to result in a complex system of navigation menus, particularly for an Apple product. The two column quick launcher contrasting with the more conventional menus also seems a bit strange. However, Apple TV does a lot of different things, and it would seem difficult to simplify its menus further without also paring away some of those features. The quick launcher seems a bit faster than the old main menu with its large graphics, and clarifies the overall features well, making it easy to explore the device without needing to consult a manual on its new features.
On
Apple TV Take 2 review (part 2): HD Movie comparisons
Published: 09:00 AM EST
The most obvious new feature of Apple TV is its ability to rent iTunes movies, including a new selection of HD flicks that turned up on the iTunes Store in the last 48 hours. Here's a look at how Apple's rental solution prices out against rival services in terms of prolonged cost, as well as a comparison of picture quality of Apple's HD downloads when viewed side-by-side against other high-def content sources such as HD Cable and Blu-ray.
Our previous segment covered the new features of the Apple TV Take Two software: HD movie rentals, HDMI improvements, new iTunes Store integration, new podcasting features, new web photo albums, new Dolby Digital surround sound audio support, and ad hoc iTunes streaming over AirTunes. Apple TV revolves around HDTV and home theater. That leads potential Apple TV buyers to the question: how well does Apple TV stack up against other sources of HD content?
The HD Download Market
The closest competitors to Apple TV's movie downloads are Vudu, Amazon's Unbox partnership with Tivo, and the Xbox 360 tied to Microsoft's Xbox Live online service. All of these offer movie downloads at a price comparable to a rental store, and all have the same 30 day rental term with a 24 hour window once you begin watching the movie. All but Unbox/TiVo offer HD content. HD content takes far longer to download, however, making a fast Internet connection critical for users who want to watch HD downloads.
All of these system use hardware with a native 720p display system except for the Vudu, which appears to have a higher 1920 x 1080 internal native resolution. However, resolution really isn't as much of a factor because downloads simply lack the bandwidth to deliver 1080p content without compressing the signal to the point where the extra resolution is overwhelmed by compression artifacts. Vudu's 720p content is already heavily compressed, and it only offers a small selection of 1080p titles, so its hardware advantage primarily just makes the unit more expensive.
Vudu currently has the largest selection of SD movies (~5000) and a growing selection of HD titles. Amazon has a significant library but no HD offerings yet. Apple opened its movie rental business with 1000 titles and has about 100 HD titles available. Microsoft only has a few hundred titles available for download, with a select number of them in HD. Next to its fledgeling Apple TV rental business, however, Apple also sells and rents SD movies from iTunes for use on PCs, iPods, and iPhone. That should help establish volume sales and drive the company's movie library quickly. Well over a hundred million people use iTunes with the iPod, while TiVo, Vudo, and the Xbox 360 combined only add up in the low tens of millions.
Vudu hit the ground running first, but has been forced to drop its hardware price from around $400 to $295 to compete with Apple TV. Since Apple intentionally runs its iTunes Store at only a slight profit in order to provide content for its hardware, Vudu's expensive hardware cut suggests big problems for the startup, as it will be forced to compete in media sales against a low profit or loss leader business going forward.
Amazon appears to have no problem competing in the cheap content market; it is currently undercutting Apple in music prices by a slight fraction and matches Apple's movie rental prices. Amazon relies upon TiVo to supply its hardware, and TiVo is supported in part by its own subscription fees. However, Amazon's partner has been losing tens of millions of dollars every quarter, so that arrangement might not last long either.
Microsoft runs its movie download business as an afterthought for the Xbox 360, which is focused on games. The company has not sold a significant fraction of the market's TV or movie downloads, and its hardware sales are down dramatically year over year. After hitting its peak in 2006, sales of the Xbox 360 nosedived by over 33% last year, as noted in Video Game Consoles 2007: Wii, PS3 and the Death of Microsoft�s Xbox 360. Whether Microsoft will continue to dump money into the Xbox and particularly the non-gaming side of its Xbox Live service remains to be seen.
In addition to these hardware-centric offerings, there are also three other major movie rental download services, Cinema Now, MovieLink, and Vongo, which are all tied to Windows Media DRM on a PC. Apple has been competing against these three studio-owned businesses, and rapidly outpaced them last year despite the limited appeal of iTunes' SD movies, a lack of any rental options, and no HD offerings. As presented in Apple TV Digital Disruption at Work: iTunes Takes 91% of Video Download Market, Apple began 2007 with 40% of the paid movie download market and essentially all of the paid TV market, and ended with around half of the online movie business and no real competition for TV sales.
That means while Apple is just starting to get serious about Apple TV, it should have no problem with growth in the rental business as other companies such as NetFlix ineffectually scramble to enter the downloads market with PC-only playback and no hardware partnerships in place. Netflix plans to introduce an Apple TV competitor with LG, but that product has not yet been finished.
Of all the set top hardware and PC-centric download services, only Apple has any effective mobile strategy. While Microsoft has an iPod competitor and a smartphone platform to rival the iPhone, it hasn't put together any workable strategy for moving media seamlessly between any of them in the way Apple has. Everyone else is even further behind or has expressed no interest in mobile markets.
Competition from HD Disc
Outside of the download market, Apple TV's movie rental business faces competition from optical disc formats, both the entrenched DVD and the aspiring Blu-Ray and the remains of HD-DVD. All three formats have a luxury of bandwidth that Apple TV--and every other download service--lacks. Even the decade-old DVD delivers a 9.8 Mb/sec data signal; many US households only have a 1.5 Mb/sec connection to the Internet, and the fastest service usually peaks out around 6 Mb/sec.
Despite that advantage, Apple TV can compete well against DVD because that format uses the older MPEG-2 compression. Movies from iTunes use MPEG-4 H.264, which is roughly twice as efficient. That means iTunes can push near DVD-quality video in real time to users with a fast Internet connection, and with a streaming delay, can even deliver HD quality video that bests DVD.
The Blu-Ray format can pump out 36 to over 200 Mb/sec of data, which simply can't be matched by downloads. While the first wave of Blu-Ray discs used MPEG-2, newer titles are beginning to use the same efficient compression that download files use. This enables Blu-Ray to deliver 1080p video and specialty HD audio tracks using much less compression and subsequently more picture clarity and audio fidelity.
However, to appreciate that data stream users will need an HDTV set that has a native 1920 x 1080 resolution. Unless a set specifically advertises 1080p native output, it will automatically display Blu-ray video at a lower 720p resolution, or 1280x768. Further, seeing the difference in resolution between 1080p and 720p requires a set larger than about 50 inches. That reality has effectively pushed HD disc formats such as Blu-Ray into a high end niche similar to the failed DVD-Audio and SACD that were intended to replace CDs with a new audiophile quality disc format.
The market for HD discs turned out to be so small that the two rival formats couldn't coexist. HD-DVD is now all but dead, and Blu-Ray has yet to see widespread adoption. Consumers have instead been buying upconverting DVDs, which present standard definition discs as pristinely as possible on new HDTVs at a much lower cost. There is also a lot more content on DVD; Blu-Ray only has around 350 titles.
The great advantage of HD discs is also paired with its largest drawback: they are physical media that need to be stored and moved around slowly. Renting discs requires traveling to a video store or signing up for a subscription to a service like Netflix. This can compare well in price with download services, particularly for frequent renters, but also limits users to a set of three options for immediate viewing and requires them to set up a queue of titles and wait a day or two for delivery. This difference helps to make Blu-Ray disc and download services like Apple TV more complementary and overlapping than directly competing. A Blu-Ray player also can't access individual TV episodes or other features that Apple TV provides.
On
The most obvious new feature of Apple TV is its ability to rent iTunes movies, including a new selection of HD flicks that turned up on the iTunes Store in the last 48 hours. Here's a look at how Apple's rental solution prices out against rival services in terms of prolonged cost, as well as a comparison of picture quality of Apple's HD downloads when viewed side-by-side against other high-def content sources such as HD Cable and Blu-ray.
The HD Download Market
The closest competitors to Apple TV's movie downloads are Vudu, Amazon's Unbox partnership with Tivo, and the Xbox 360 tied to Microsoft's Xbox Live online service. All of these offer movie downloads at a price comparable to a rental store, and all have the same 30 day rental term with a 24 hour window once you begin watching the movie. All but Unbox/TiVo offer HD content. HD content takes far longer to download, however, making a fast Internet connection critical for users who want to watch HD downloads.
All of these system use hardware with a native 720p display system except for the Vudu, which appears to have a higher 1920 x 1080 internal native resolution. However, resolution really isn't as much of a factor because downloads simply lack the bandwidth to deliver 1080p content without compressing the signal to the point where the extra resolution is overwhelmed by compression artifacts. Vudu's 720p content is already heavily compressed, and it only offers a small selection of 1080p titles, so its hardware advantage primarily just makes the unit more expensive.
Vudu currently has the largest selection of SD movies (~5000) and a growing selection of HD titles. Amazon has a significant library but no HD offerings yet. Apple opened its movie rental business with 1000 titles and has about 100 HD titles available. Microsoft only has a few hundred titles available for download, with a select number of them in HD. Next to its fledgeling Apple TV rental business, however, Apple also sells and rents SD movies from iTunes for use on PCs, iPods, and iPhone. That should help establish volume sales and drive the company's movie library quickly. Well over a hundred million people use iTunes with the iPod, while TiVo, Vudo, and the Xbox 360 combined only add up in the low tens of millions.
Vudu hit the ground running first, but has been forced to drop its hardware price from around $400 to $295 to compete with Apple TV. Since Apple intentionally runs its iTunes Store at only a slight profit in order to provide content for its hardware, Vudu's expensive hardware cut suggests big problems for the startup, as it will be forced to compete in media sales against a low profit or loss leader business going forward.
Amazon appears to have no problem competing in the cheap content market; it is currently undercutting Apple in music prices by a slight fraction and matches Apple's movie rental prices. Amazon relies upon TiVo to supply its hardware, and TiVo is supported in part by its own subscription fees. However, Amazon's partner has been losing tens of millions of dollars every quarter, so that arrangement might not last long either.
Microsoft runs its movie download business as an afterthought for the Xbox 360, which is focused on games. The company has not sold a significant fraction of the market's TV or movie downloads, and its hardware sales are down dramatically year over year. After hitting its peak in 2006, sales of the Xbox 360 nosedived by over 33% last year, as noted in Video Game Consoles 2007: Wii, PS3 and the Death of Microsoft�s Xbox 360. Whether Microsoft will continue to dump money into the Xbox and particularly the non-gaming side of its Xbox Live service remains to be seen.
In addition to these hardware-centric offerings, there are also three other major movie rental download services, Cinema Now, MovieLink, and Vongo, which are all tied to Windows Media DRM on a PC. Apple has been competing against these three studio-owned businesses, and rapidly outpaced them last year despite the limited appeal of iTunes' SD movies, a lack of any rental options, and no HD offerings. As presented in Apple TV Digital Disruption at Work: iTunes Takes 91% of Video Download Market, Apple began 2007 with 40% of the paid movie download market and essentially all of the paid TV market, and ended with around half of the online movie business and no real competition for TV sales.
That means while Apple is just starting to get serious about Apple TV, it should have no problem with growth in the rental business as other companies such as NetFlix ineffectually scramble to enter the downloads market with PC-only playback and no hardware partnerships in place. Netflix plans to introduce an Apple TV competitor with LG, but that product has not yet been finished.
Of all the set top hardware and PC-centric download services, only Apple has any effective mobile strategy. While Microsoft has an iPod competitor and a smartphone platform to rival the iPhone, it hasn't put together any workable strategy for moving media seamlessly between any of them in the way Apple has. Everyone else is even further behind or has expressed no interest in mobile markets.
Competition from HD Disc
Outside of the download market, Apple TV's movie rental business faces competition from optical disc formats, both the entrenched DVD and the aspiring Blu-Ray and the remains of HD-DVD. All three formats have a luxury of bandwidth that Apple TV--and every other download service--lacks. Even the decade-old DVD delivers a 9.8 Mb/sec data signal; many US households only have a 1.5 Mb/sec connection to the Internet, and the fastest service usually peaks out around 6 Mb/sec.
Despite that advantage, Apple TV can compete well against DVD because that format uses the older MPEG-2 compression. Movies from iTunes use MPEG-4 H.264, which is roughly twice as efficient. That means iTunes can push near DVD-quality video in real time to users with a fast Internet connection, and with a streaming delay, can even deliver HD quality video that bests DVD.
The Blu-Ray format can pump out 36 to over 200 Mb/sec of data, which simply can't be matched by downloads. While the first wave of Blu-Ray discs used MPEG-2, newer titles are beginning to use the same efficient compression that download files use. This enables Blu-Ray to deliver 1080p video and specialty HD audio tracks using much less compression and subsequently more picture clarity and audio fidelity.
However, to appreciate that data stream users will need an HDTV set that has a native 1920 x 1080 resolution. Unless a set specifically advertises 1080p native output, it will automatically display Blu-ray video at a lower 720p resolution, or 1280x768. Further, seeing the difference in resolution between 1080p and 720p requires a set larger than about 50 inches. That reality has effectively pushed HD disc formats such as Blu-Ray into a high end niche similar to the failed DVD-Audio and SACD that were intended to replace CDs with a new audiophile quality disc format.
The market for HD discs turned out to be so small that the two rival formats couldn't coexist. HD-DVD is now all but dead, and Blu-Ray has yet to see widespread adoption. Consumers have instead been buying upconverting DVDs, which present standard definition discs as pristinely as possible on new HDTVs at a much lower cost. There is also a lot more content on DVD; Blu-Ray only has around 350 titles.
The great advantage of HD discs is also paired with its largest drawback: they are physical media that need to be stored and moved around slowly. Renting discs requires traveling to a video store or signing up for a subscription to a service like Netflix. This can compare well in price with download services, particularly for frequent renters, but also limits users to a set of three options for immediate viewing and requires them to set up a queue of titles and wait a day or two for delivery. This difference helps to make Blu-Ray disc and download services like Apple TV more complementary and overlapping than directly competing. A Blu-Ray player also can't access individual TV episodes or other features that Apple TV provides.
On
Apple bucking the trend of declining PC prices
Published: 12:15 PM EST
Apple's capacity to maintain (and even raise) the average selling price of its personal computer systems in a market rife with yearly declines is just one of the reasons analysts at JMP Securities remain bullish the company's shares.
In a research report Friday, analyst Ingrid Ebeling noted that of the top 25 computers on Amazon.com�s best-seller list for the category of computers, Apple desktops and portables command 10 of the 25 spots, with an average selling price (ASP) of $1,482, compared with an ASP of $579 for the remaining 15.
Similarly, for fiscal year 2005, the ASP for Macs was $1,442, compared with $1,384 for fiscal 2005 in an industry characterized by declining ASPs, which fell from $1,042 to $957 over the same time frame, according to market research firm IDC.
"Although economic uncertainty in the US looms overseveral names in our sector, including Apple, we believe the overall PC industry market in 2008 will continue to be fueled by consumer demand for digital media, increased adoption of portable computers, and growth in emerging markets," Ebeling said. "The adoption of portable computers has been a contributing factor to growth, with units up 34 percent in 2007, a trend that has helped Apple given the response to the MacBook line."
However, she added that Apple�s desktop sales have also been very robust following the release of the new iMac, which drove year-over-year unit growth to 53 percent in the December quarter.
"Over the past two years, we estimate Apple�s worldwide market share has risen from 2.3 percent of 207 million units sold to 3.0 percent of 262 million sold, or from 4.7 million Macs sold in 2005 to 7.9 million Macs in 2007, representing a 2-year Compound Annual Growth Rate (CAGR) of 29 percent, compared to a 12 percent CAGR for the PC industry," she wrote. "In the US, we estimate that Apple�s share has increased from 4.5 percent to almost 7 percent, and that itsshare in the laptop market now exceeds 15 percent."
In respect to iPods, the analyst acknowledged recently disappointing results, but said she's still forecasting revenue growth of 17 percent and 14 percent in fiscal 2008 and 2009 based on unit growth of 5 percent and 13 percent, which assumes that the iPod touch -- with price tags of $299, $399,or $499 -- will help boost the product line�s ASP.
Over time, she expects the product should gain momentum as not just an iPod but also an Internet device. "It is considered one of the best WiFi mobile platforms and has a powerful interface to run Web applications," she said. " As Apple continues to add content to its iTunes store,such as movie rentals, consumers could be compelled to upgrade to the more expensive devices."
The JPM analyst reiterated her Market Outperform rating and $200 price target on shares of the Cupertino-based company.
In a research report Friday, analyst Ingrid Ebeling noted that of the top 25 computers on Amazon.com�s best-seller list for the category of computers, Apple desktops and portables command 10 of the 25 spots, with an average selling price (ASP) of $1,482, compared with an ASP of $579 for the remaining 15.
Similarly, for fiscal year 2005, the ASP for Macs was $1,442, compared with $1,384 for fiscal 2005 in an industry characterized by declining ASPs, which fell from $1,042 to $957 over the same time frame, according to market research firm IDC.
"Although economic uncertainty in the US looms overseveral names in our sector, including Apple, we believe the overall PC industry market in 2008 will continue to be fueled by consumer demand for digital media, increased adoption of portable computers, and growth in emerging markets," Ebeling said. "The adoption of portable computers has been a contributing factor to growth, with units up 34 percent in 2007, a trend that has helped Apple given the response to the MacBook line."
However, she added that Apple�s desktop sales have also been very robust following the release of the new iMac, which drove year-over-year unit growth to 53 percent in the December quarter.
"Over the past two years, we estimate Apple�s worldwide market share has risen from 2.3 percent of 207 million units sold to 3.0 percent of 262 million sold, or from 4.7 million Macs sold in 2005 to 7.9 million Macs in 2007, representing a 2-year Compound Annual Growth Rate (CAGR) of 29 percent, compared to a 12 percent CAGR for the PC industry," she wrote. "In the US, we estimate that Apple�s share has increased from 4.5 percent to almost 7 percent, and that itsshare in the laptop market now exceeds 15 percent."
In respect to iPods, the analyst acknowledged recently disappointing results, but said she's still forecasting revenue growth of 17 percent and 14 percent in fiscal 2008 and 2009 based on unit growth of 5 percent and 13 percent, which assumes that the iPod touch -- with price tags of $299, $399,or $499 -- will help boost the product line�s ASP.
Over time, she expects the product should gain momentum as not just an iPod but also an Internet device. "It is considered one of the best WiFi mobile platforms and has a powerful interface to run Web applications," she said. " As Apple continues to add content to its iTunes store,such as movie rentals, consumers could be compelled to upgrade to the more expensive devices."
The JPM analyst reiterated her Market Outperform rating and $200 price target on shares of the Cupertino-based company.