iPhone and Apple TV: Our Opinions, Post-Expo

As you’re probably aware from all of our Macworld Expo and CES news coverage, iLounge’s editors have been plenty busy communicating just the facts behind Apple’s newest two gadgets: the potentially revolutionary iPhone, and the intriguing Apple TV. What we haven’t shared are our opinions on these devices – an internal discussion that started (quietly, mostly with dropped jaws) in the middle of Apple CEO Steve Jobs’ keynote, and continued virtually unabated until we took our separate planes home from the Expo. Our editors in attendance represented the United States, United Kingdom, and Canada – three of Apple’s biggest iPod territories – and a variety of different opinions about the iPod’s direction going into the keynote speech. Here’s the summary of our thoughts.

iPhone and Apple TV: Our Opinions, Post-Expo

Apple TV: There are four important opinions we wanted to share on the media playback and storage device Apple TV, which is covered in more detail here.

(a) A Winning Execution: As Apple’s first true “living room device,” Apple TV appears to achieve its broad goal: bringing the simplicity and beauty of Apple user interfaces, and iTunes content, to any widescreen 480p or better television set. Thanks to the Apple Remote and second-generation Front Row software, Apple TV makes navigation of your movies, music, and photos extremely easy, and actually very visually attractive. Though the device wasn’t yet final, we were all impressed by the execution of what was on display.

(b) Pricing and Utility: Even though it now packs a 40GB hard drive, the price point still somehow feels wrong. AirPort Express’s $129 price would have been a little stretch for a device that only played streamed iTunes music, but it was made up for by the unit’s multi-functionality; Express can also help you achieve wireless printing, and/or set up a simple wireless network in your home. Many – perhaps most – Express users have at one time pulled the unit from their homes and used it for wireless access during travel; its size makes that possible, and attractive. By comparison, at $299, Apple TV exists for one purpose: to play iTunes content on your TV. It’s not likely to be carried around, and wouldn’t do much good outside your home. And you still have to buy the video cables yourself. All you get for the price is the unit, the remote, and a power cord. Plus, Apple says you’ll need an existing wireless network to use virtually all of its features.

 

iPhone and Apple TV: Our Opinions, Post-Expo

(c) Video as the Non-Killer App: This point’s the biggest of the bunch. AirPort Express made sense because everyone with iTunes has music – it’s the lowest common denominator feature of the software. But video on iTunes has been far less popular. Apple’s sales of 50 million TV shows and 1.3 million movies are great by digital download standards, but drops in the bucket by comparison with the 2 billion songs sold through the iTunes Store – in fact, given how many people now use iTunes and own iPods, the video numbers should be much higher. Are people importing vast quantities of their own video content into iTunes? It’s unclear. If they haven’t been, there won’t be a lot to watch on Apple TV: like iPods, the device only supports the H.264 and MPEG-4 formats, and doesn’t have a DVD drive to play back movies. YouTube aside, plan to do a lot of file converting – or purchasing through Apple – if you want to keep your Apple TV occupied. Video content should and must be the biggest draw for a device like this, but free video podcasts aren’t likely to make such a purchase compelling.

(d) International Appeal: Related to point C, the iTunes Store still isn’t selling the majority of its video content outside of the United States. How will Apple TV fare in other territories – will people be willing to buy a $299 device just to stream music, photos, and self-converted videos to a home television set? Our U.K. editor has repeatedly pointed out that he uses his fifth-generation iPod almost exclusively for music; it’s clear that he’s not the device’s target customer. Who is?

We’re obviously going to wait for the final product before we make final determinations on Apple TV’s utility and viability, but our sense at the moment is that it’s a well-executed, niche product. One iLounge editor called it a “solution in search of a problem,” but on balance, we think that’s not a fair statement – many people want to watch video content from their computers on a TV set, particularly without needing to have the computer turned on at all times, and a device with the ability to cache and play back videos (and photos, and music) is a good idea. The problem would be what’s missing: once you buy Apple TV, you can’t play back all (or even most) of your video content through it – you still need a DVD player and/or a DVR, and then, a DVR that converts into MPEG-4 or H.264 format. Perhaps in Apple TV 2?

 

iPhone and Apple TV: Our Opinions, Post-Expo

iPhone: In part because it was new, but in part because it was exactly the sort of device we were hoping to see from Apple, virtually all of our discussions focused on iPhone, which is covered in more detail here. Aside from all the facts behind the phone, which you’ll no doubt see discussed ad nauseum for the six months leading up to its release, we had these opinions to share.

(a) Is it Cool? This one seems obvious, but it needs to be said up front: the iPhone is seriously cool, and not just “original iPod cool,” which way back when was “wow, that looks really nice, but I can’t afford it.” Whether our editors were watching it on stage, seeing it in a glass display case, or holding it in hand, we agreed that iPhone is the sort of device that will outsell the original iPod by leaps and bounds, despite any issues it may have. During and immediately after the keynote, with Steve Jobs’ Reality Distortion Field still in effect, we were ready to buy them on the spot. Days later, even as the Field was wearing off, most of us were still pretty much convinced that we’d be buying them.

(b) But… Who’s the Customer – a Cell Phone or Smartphone User? Even though we’re iPod fans, and for review reasons wind up with every model under the sun, iLounge’s editors try our hardest to retain a mainstream perspective on new Apple products. And iPhone walks the fine line of “mainstream” – like Apple TV, no matter how the sales pitch goes, it’s basically trying to create its own product category. It’s a smartphone-sized device that’s not made for the geekiest of smartphone users. It’s a super video iPod without the storage capacity to satisfy super video fanatics. And it’s an Internet device with graphic demands better suited to indoor Wi-Fi use than outdoor cell tower roaming. Four changes could have muted these concerns: swappable batteries and third-party apps for the smartphone crowd, a memory card slot or higher storage capacity for video users, and support for emerging 3G networks – with a Cingular pledge to implement them over the next six months. Since none of this has happened, we’re left to guess that the target customer here is an unsatisfied smartphone user who is seeking simplicity, and is willing to take a chance on Apple to deliver it. Apple’s probably going to exceed its 10 million unit target for iPhone, but in its current form, this surely isn’t going to dominate the yearly 1-billion-unit cell phone business like the iPod has dominated the MP3 market. Future versions are needed, and inevitable.

 

iPhone and Apple TV: Our Opinions, Post-Expo

(c) Cingular/AT&T: Though one of our editors was from Canada and another was from the U.K., none of us were happy about the selection of Cingular/AT&T as the sole U.S. provider of network services for iPhone, or the hint that users in other countries would be similarly limited to the choice of only one provider, then locked to that provider for two-year contracts. We don’t like two-year contracts, especially when we’re dealing with a company (Apple) that releases cool new products every six or twelve months. How are iPhone users supposed to upgrade or handle repairs for their phones, and will the experience be frustrating? Pricing of the Cingular plans is also a very serious concern: if iPhone’s data plan costs more than the Sidekick 2’s $20 per month to operate, even iLounge’s editors may wind up passing on it, believe it or not.

 

iPhone and Apple TV: Our Opinions, Post-Expo

(d) Future iPod Technologies: Readers have asked us whether we think that the iPhone’s new iPod-related technologies will in fact make their way into future iPods. We think that the answer is “definitely.” The next question is, “when?” After a lot of discussion, our best guess is “after the iPhone has shipped.” From Apple’s most likely perspective, fewer iPod users will be willing to pay a premium for the most enticing new iPod-related feature – the wider, higher-resolution screen – if there’s a 6G iPod with the same screen already on the market. Though we disagree, primarily because there are going to be literally millions of people who don’t want and aren’t going to be willing to pay for the phone and Internet features, we understand the other perspective. Having let its cat out of the bag so early, giving competitors plenty of time to conjure up their own products, our hope is that Apple already realizes the shackles that six months of waiting and the two-year, single-carrier contract will put on the iPhone – quite possibly the entire iPod family – and acts much sooner to release the iPod family followups we’ve been waiting for.

Those are our thoughts on Apple TV and iPhone. Do you agree? Disagree? As always, we welcome your comments and insights below.

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