The iPanel and Sharp

I’m really trying to think about this ipanel project because I think that unless apple really comes up with something that really kicks ass they will have a hard time maintaining the earnings growth that they currently have.

Currently, Apple seems to make the majority of its money off of the iphone. I just bought an android samsung for 200 dollars that does everything the iphone does and some things even better. While for yuppies and fanboys they are willing to pay a 500 dollar premium (especially if it gets paid by the cell service providers) I really wonder if this is sustainable in the long run. I think this next earnings will show that providers don’t want to pay it anymore.

Apple needs a new next big thing to keep people coming back and to keep the brand fresh. There is nothing that I can imagine they can possibly do with the iphone or the ipad with today’s technology that I think will make a whole hell of a difference. Apple has no choice but to branch out into other stuff.

I’ve been long apple pretty much since I was in highschool. I am currently short it, but looking to get back in after a correction which I think might happen after April 24 earnings (or possibly even yesterday depending on how you look at it).

In order for me to really believe this is a trillion dollar company the ipanel is gonna have to do a lot more than just be a tv with a sick display and connectivty to movies and games.

My opinion. The TV should basically be controlled by your phone or your ipad and yes, maybe some sort of norminal remote if need be. The TV though will not be a touch screen. If it is I’m shorting.

However, I think the TV will also and MORE IMPORTANTLY be controlled by something like siri. Why? Because I think you’ll be able to tell it do things around your house for you. Starting with the basic stuff that you can already imagine:

Siri, “Turn on CNN.” This is easier than finding or remembering which channel CNN is on especially when you have 400 channels. Easy for Siri to look up. Imagine going into a hotel room in a new city and being able to say, “Siri, find me skinimax or the PGA championship.” Would be handy.

Siri, “Let’s watch a the latest episode of ‘Entourage.’” This is easier than having to go through your on-demand cable and finding it. Might be tricky for apple to work this out with the cable providers, but certainly possible.

Siri, “Are there any good baseball games on,” This is easier than having to look it up yourself. Siri looks it up for you and comes up with recommendations based on your location. Easy.

Siri, “Record every episode of Gossip Girl between now and eternity and save it for later.”

The TV will have some sort of game functionality. Probably similar to the ipad which means you can have some decent games on it. I’m not saying it will compete with xbox. Don’t think it needs to.

Siri, Let’s play “Assasin Creed,” or “Angry Birds” and there you are. This is pretty much a given.

I also think that there is room for something a little more sci-fi in this. For ages we’ve been waiting for the automated computerized home. I think we are actually at the point where that could be done relatively easily and cheaply with the right technology and army full of smart ass engineers working on it.

“Siri, make me some toast.” Well, it probably won’t do that. But it probably could do other things like, “Siri, turn on the surround sound in the bedroom.” Siri, “Turn the Thermostat to 72 degrees.” “Siri, I’m tired, turn off the lights.”

It’s not such a leap to me that Apple couldn’t come up with something like this. The past 15 years of their product history has been around centralizing and integrating appliances and electronic devices into one system that you use. Rememeber how we used to have separate webcams, separate telephones, separate monitors, separate mice (we use touch screen now or just our voice), separate car stereos with cd players. Now we all do it with our iphone or our ipad.

I think if Apple did start to move in this direction people would buy it. I know I would. Because Apple has the high end consumers, the people who make appliances will no doubt cooperate with Apple the way Car Makers have using the iphone as a stereo, the same way printers now have wifi and bluetooth.

I think it is very feasible. It is relatively easy and cheap to connect just about anything to wifi these days. But how do you monetize it?

Simple, you make them buy your overpriced TV. Just like ipad can make telephones but doesn’t, could have siri, but does, apple will make you buy the ipanel just to get this service. Would you pay 2000 dollars for a TV? Probably not. But would you pay 2k for a TV if it did some of the stuff I’ve mentioned above? Yep. My guess is that the iPanel will be the brain of this household system. It will be a TV, a Multimedia Center, a Game Console, Web-browser, etc. But it will also control your whole house for you, just like those really sweet Asian hotel rooms with all the buttons that do everything. The benefit is there will be no buttons and no wires. Just voice commands and wireless signals. Wouldn’t it be nice just to walk into your hotel room and say, “Put on a porn, and turn off the lights?”

I’ve been waiting for apple to head more in this direction for years. They have actually been slower to do it than I imagined. But I think working with designers like Phillip Stark (even though he is now claiming it is a yacht) is evidence of where they are going. It might be awhile before our ipanel notices that we are running low on milk and orders some on amazon automatically, but I think that could be the future of apple post a shitty little phone.

A thought on a potential supplier:

  1. Im having a look at Sharp. I don’t own anything Japanese. Never have. I think thy are most likely going to provide the display technology for the new Macbooks and the rumored iPanel. Anyone have any thoughts on how much they could benefit from having Apple as a customer? The CFA would tell us that Sharp would get the majority of the benefit of the new technology’s profit. I’m doubtful, but wondering.

Here’s an article that seems to agree with me.

I really think this is so obvious that it has to happen.

You were long apple since HS? So…you’re up like 1000% on that one position?

I can imagine Apple devices controlling the TV in the future. However, I doubt that Apple will actually sell the TV. The production cost will be too high. It would be hard for Apple to maintain 35% margins for a $2000 TV. Also, consider that Apple wants to sell you a new device every 1-2 years. People keep their TVs for much longer than that - probably 7 years or more.

Instead, Apple will try to sell an advanced version of Apple TV - a box that controls the TV. It will be priced between $500 and $1000, it will connect to iTunes (so you can buy movies from them), it will sync up with iCloud, and it will talk to your iPad or iPhone.

Ohai, that already exists in the Apple TV. I think they’ll have a hard time selling that and charging a fortune for it which is what they want to do.

However, if I could talk to my TV like Siri and it had a beautiful screen to go wtih it then I might shell out some cash.

Upgrading it every 2 years is problematic. Not sure how that’ll work. My parents still have a TV from before I was born.

Yes, Apple TV exists. This proves that Apple is interested in the concept of a box that talks to your TV. It’s just that past technology did not allow for the applications that you imagined. If Apple is going to expand their TV business, it is likely that they will use new technology to improve Apple TV. Making an actual TV would be far more risky and would require much more research.

Furthermore, making a TV will put Apple in competition with other TV makers - Sharp, Panasonic, etc. Consumers will have to choose either an Apple TV or a normal TV. By pioneering a TV box, Apple will only have indirect competition (with XBox, Roku, etc.). This opens up a broader market for the new Apple device.

In addition, an Apple TV would not work with Apple stores. Apple wants to get you into stores, where they can impress you with shiny new things. You can also bring your i-Devices into an Apple store for easy service. All this helps pull you into the Apple world. It’s not practical to line up outside the Apple store and bring home a 50" TV. It’s also unpractical to bring this TV into the store when you need personalization or troubleshooting. It would be much more practical for Apple to just sell you a small box.

Finally (and most importantly), there is the upgrade cycle and cost associated with a big TV. Apple can mark up iPads 40% and make huge profits. However, they cannot mark up a $2000 TV by the same percentage. The economic case is just not compelling. An Apple TV might be conceptually interesting, but it would be a business failure, at least by Apple standards.

The problem with being able to talk to your TV is lack of control. I don’t want my kids to be able to yell out “put on Dora!” in the middle of a football game and change the channel. Controlling the remote is a very serious thing.

And, the iTV or iPanel or whatever will cost well over $2,000. Think about the first HDTVs that came out. I paid over $3,000 for both of mine. Since then they’ve come way down, but a truly revolutionary product will cost you. I’ll say it’ll be comparable to the first HDTVs…~$3,500. Then the trick becomes being able to significantly upgrade your iTV by purchasing software updates. The average useful life has to be at least 7 years before having to replace a monitor. But, I’d shell out $200 for a bi-annual upgrade if it added a lot of functionality. That’s where the margins are anyway.

TVs are still the center of every household. Being able to add it to your home network will be a huge boon for Apple and will drive additional iMac sales (just as the iPhone and iPad have done). iTV could be the gadget that brings it all together.

Or it could bring Apple down if it sucks. No pressure Apple.

I disagree that TVs are the center of today’s households.

First of all, affluent consumers (i.e. those targeted by Apple) are likely to have multiple TVs. It’s becoming normal for kids to have TVs in their rooms hooked up to XBox, etc. When 30" TVs cost less than $100 in the future, this will be increasingly so.

Second, devices like the iPad or even normal laptops are becoming more important and widespread. Once 5-year-old kids start watching Dora on their tablets, they will not want to share the TV with their dad who keeps switching to football.

I also disagree that Apple TV would be the most important device for Apple. An affluent household with two parents and two kids could potentially own 4 iPhone, 4 iPads, and multiple Mac PCs. However, they would only own one or two Apple TVs. The market for iOS or other personal devices is much larger than the market for a TV interface device.

Furthermore, buying Apple TV will be more or less contingent on already owning other Apple devices. Why would you buy Apple TV if you didn’t already have a library of content on iCloud?

I am also surprised that no one mentioned one very important point - you cannot take an Apple TV with you. If you can’t flash your new iPhone at other people, it is useless as a status symbol. (Come on, you know this is true.)

No new set top box or tv this year says this guy. Gotta wait till 2013 for the former and 2014 for the latter. Makes sense.

similar to my prediction. I think this will be the death of the desktop computer once and for all. Id still like it to do more but yep, I’d buy one, especially if it were well integrated with my cable, especially in lieu of buying a new iMac and desktop which I will never again buy under any circumstance as the ones I’ve had for nearly 5 years are fine.

the question i ask myself is if Apple can remain a global brand the same way Nike has been for the past 30 years… I continue to buy Nike Shoes without getting bored of the brand… there is a risk that after 3-4 generations of Iphones people will get bored of owning an Apple phone… i think it is an exception to the rule that people are “married” to a brand… like Nike. Ive owned a Toyota /BMW/ but now i want a porsche… people that buy the “new Honda civic” every 4 years are weird… Apple has relied on repeat customers for the past 10 years… but my my thesis is that this will end.

10 years ago… only hipsters and the anti conformity crowd bought apple. now EVERYONE has Apple (in the united states)… culture trends and fashion move faster than the market… at some point… it will be cool to NOT have an apple phone/laptop/tablet…

but but but… there is HUGE room for growth in developing countries… Apple products have next to zero market share in places like Brazil/China/India. once its not cool anymore in the United States the emerging markets will follow. i believe there is a product life cycle and a brand life cycle… Apple will trip up somewhere and die

likely cause the average income levels are only a few times the cost of an IPAD…i don’t think Emergining Market ppl are as stupid to pay so much for crap…

i never understood the appeal of aapl products…seems like overpriced gadgets…i figure eventually ppl will realize this…

As soon as everyone in the emerging marktets gets an iPhone I will know its the end. For now they haven’t diminished eir brand by trying to make a smart phone that your average Asian can afford. The moment they do, it will cease to be cool to own an iPhone.

its not cool now to use an iphone…only douche would think its cool…

It’s still cool here. I go to my country club here, which is filled with 75 year old Indian men, all hanging out listening to floyd on their ipads in the lockerroom.

do you go for indian babes?

Nah, not usually. Too much work. You gotta meet the family and do all that stuff. It’s a pain. There is an instant question of marriage etc.

I’d only date an Indian girl if her parents were both dead and she lived in a different city than the rest of her family.

so there are no Hot Trashy Babes in India? wtf you donig there then? go to russia or something…

Oh there are. Just usually the daddy thing. I bring Russia to me. Have you seen the weather there. No thanks.

i think Canadian weather is comparable to Russia?..