In a recent note to investors, Piper Jaffray analyst Gene Munster reiterated his position that Apple is planning to release an Internet connected HDTV in the next 2-4 years. Now before we delve deeper into Munster’s predictions, we should point out that rumors of an Apple branded HDTV have been making the rounds for some time now, so take Munster’s prediction with a grain of salt. And besides, a prediction 4 years down the line isn’t really much of a prediction, now is it? But I digress.
With that caveat out of the way, onto the meat and potatoes of Munster’s note. Munster believes that Apple is poised to release a $2000 HDTV sometime in the next few years.
“As connected TVs proliferate the integration of hardware,” Munster writes, “software and content will become a key selling point for TVs. We believe Apple is uniquely positioned to combine these elements at competitive prices for an Apple-branded TV.”
Recently, the average selling price of quality HDTV’s have steadily declined, and nowadays you can pick up a premium SONY or Samsung HDTV for under $1500. So what, then, would prompt Apple to release their own branded TV for $2000+?
Well, Munster writes that Apple’s HDTV will include Internet connectivity, and that customer access to TV Shows via iTunes will all but negate the need for cable. Specifically, Munster anticipates Apple offering a $50-$90 subscription service to users whereby they’d be able to download and perhaps stream all of their favorite content at a much lower price than what is often charged by cable providers. Case in point – I currently pay about $100 for Cable+DVR service via DirectTV.
Moving along, Munster writes that Apple’s file of over 125 million iTunes accounts will give it a strong inroad into a market that isn’t typically welcoming to new business models. By combining a quality HDTV with iTunes subscriptions, Munster writes that Apple would be able to offer an all-in-one entertainment solution that would negate the need for varying devices (TV + DVR + Cable Box etc.) Not only that, but Munster believes that an Apple HDTV could also negate the need for a gaming console and a Blu-Ray player.
“Given Apple’s recent success in portable gaming,” Munster writes, “an all-in-one TV could be a logical next-step for the company to expand its reach further into the gaming market with limited risk using an existing technology infrastructure.”
Moreover, Munster writes that Apple could leverage its its success with the iPhone and iPod Touch to create an environment where media content is truly mobile.
To be fair, Munster is no nostradamus when it comes to Apple predictions, and he’s been notably wrong many times in the past. Also, Munster’s theory raises a lot more questions than answers, and his description of an all-in-1 HDTV device appears overly simplistic. Still, some food for thought on where Apple may be headed next.