2% market share is the reality for Apple TV, but Apple still wants to realize the ideal of "Disney"

Apple has always been a leader in the industry. For example, the iPod revolutionized the music industry, and the iPhone+App Store model revolutionized mobile terminals...

However, with the iPhone successfully taking over the iPod, Apple is deeply saddened by the home video scene. According to Strategy Analytics data, in Q1 2020, Apple TV only accounted for 2% of the market share in the streaming device industry.

Although the iPad has shouldered this burden to some extent, with the gradual evolution of 5G and IoT concepts, the smart home market is likely to reach a trillion-dollar scale in the future. As a mobile terminal, the iPad is difficult to be highly compatible with smart homes, which further increases Apple's sense of powerlessness at the entrance to the home scene.

However, as Apple's understanding of this trend gradually deepens, it is also stepping up its layout of home scenes centered on Apple TV. Whether Apple TV will decline or "change the world" in the future depends on Apple's actions in the next stage.

Terminal is just a means

Although in the potential impression of consumers, Apple can be called a "hardware" company, in fact, hardware is just a means for Apple to succeed, while platform and software are Apple's goal.

For example, the reason why the iPod launched in 2001 became the "darling" of the 2010s was not only because of its eye-catching design, but also because of the subsequent launch of the iTunes Store, which could organically connect users and copyright holders.

According to official data from Apple, the iTunes Store sold 1 million songs in just 6 days after its launch. In 2007, the revenue from iTunes services accounted for 9.8% of the global music market revenue.

In 2007, Apple dared to abandon the iPod and launch the iPhone because it saw the explosive trend of mobile Internet and hoped to expand the "platform".

This can be seen from the launch of the first generation iPhone: At that time, Jobs introduced the iPhone as a device that integrates "iPod, mobile phone, and Internet communicator". In other words, the iPhone is a horizontal expansion of product functions based on the continuation of the iPod product concept.

In fact, Apple did hit the trend right. The iPhone not only ushered in the era of smartphones, but also brought Apple rich returns at the software level.

Take the App Store as an example. Since all categories of applications must reach consumers through this channel, it brought Apple $10 billion in revenue in 2013. By 2019, this figure reached an astonishing $50 billion.

Apple's consistent product concept does allow it to smoothly transfer platforms and has unique product advantages in different historical periods. However, once starting from the sub-items, Apple's product concept actually has considerable problems, and this may determine the life and death of Apple in the next era.

Apple TV is too dogmatic

Unlike later generations’ belief that Apple directly handed over the baton of iPod to iPhone, around 2005, when online video was booming, Apple saw the opportunity in digital video and hoped to move directly from music to video.

Although digital content in the Web 1.0 era was on PCs, Apple believed that it was more convenient to receive various content through targeted terminals, such as iPod for music and TV for video.

In September 2006, Apple launched a digital multimedia receiver called Apple TV. Although it is just a "box", as long as it is connected to a home TV, Apple TV can make the TV become Apple's "puppet" display device.

On the one hand, Apple TV has the Apple style, and on the other hand, it greatly reduces the replacement cost for users. It seems that it should become an innovator in the home scene. However, as mentioned at the beginning, over the past fourteen years, Apple TV has been declining step by step.

The main reason for this problem is that Apple is still rigidly applying the "platform" strategy of iPod to the video industry.

You have to know that in 2001, Napster pirated software was rampant in the United States. Although Apple would take 30% of musicians' revenue on the iTunes Store, it was at least better than going through Napster's "free channel". In addition, the traffic of iPod was high enough, so musicians chose the lesser of two evils and turned to the iTunes Store.

In contrast, in the video industry, which includes a variety of distribution channels such as Blu-ray discs, cinemas, and live TV, it is actually difficult for Apple to completely subjugate these stakeholders with just one device.

For example, in 2011, in order to expand its content library, Apple TV chose to cooperate with American sports leagues, allowing users to watch corresponding basketball and baseball games. However, since Apple was in a passive position in this cooperation, Apple TV could not obtain any share from the sales of sports game programs - this also meant that Apple could not get the "Apple tax" that it was proud of.

As a result, Apple TV has fallen into a vicious cycle from having no content hegemony to being unable to acquire users to weakening the platform's power. As a result, it can only huddle in the traffic pool of iPhone and Mac to acquire users transferred from the Apple ecosystem.

More importantly, with Apple TV struggling, Apple took a different approach by developing the iPad based on the iPhone in 2010. Although the iPad and Apple TV belong to two different product categories, the iPad can take over some of the functions of the Apple TV, becoming the most important video and gaming terminal in the home, in addition to mobile phones and computers.

The combination of these two factors made Apple forget the pain of Apple TV and focus on mobile terminals, which opened up a glorious decade. However, unlike other failed products in Apple's history, Apple TV will not be forgotten by the industry.

Industry forces Apple

If the technology industry develops linearly, then the failed Apple TV can be completely abandoned by Apple. Unfortunately, with the explosion of technologies such as 5G and IoT, home scenes are likely to become a big blue ocean in the technology industry in the future. According to the data of "Global Smart Home Market in 2019" released by Strategy Analytics, the scale of the global smart home market will reach 1.1 trillion yuan in 2023.

As the natural hub of smart homes, TVs and box products have also begun to become the target of technology giants. For example, since 2013, China's smart TV market has repeatedly welcomed players from the Internet, mobile phone and other industries.

Apple saw this trend as early as 2014, so it added features such as Homekit hub, Home App, and TV App Store to the Apple TV released that year.

Of course, Apple is more aware that no matter how the industry guides, the main reason users buy Apple TV is for its audio-visual experience. In other words, strengthening the content can attract users and drive a positive cycle of Homekit and other functions. Therefore, in 2018, Apple announced that it would spend $6 billion to create high-quality content for Apple TV+.

However, whether in terms of content quality or user volume, Apple TV+'s performance is not satisfactory.

First, in terms of content quality, the scores of more than a dozen original dramas on Apple TV+ are all below the passing line, whether on Rotten Tomatoes or MTC. Second, in terms of user numbers, Apple's financial report shows that Apple TV+ has only gained 10 million paying members in half a year since its launch, while Disney+, which was launched at the same time, has already exceeded 50 million paying members, which further increases Apple TV+'s sense of powerlessness.

Perhaps realizing that the risks of self-made content are too high and the returns are too low, Apple, which once arrogantly declared that "Apple TV+ will not rent content", spent $70 million in May 2020 to buy the World War II film Greyhound, which Tom Hanks co-wrote and starred in. But one drama obviously cannot save Apple. It can be said that Apple TV+ has a long way to go.

Of course, another core advantage that makes Apple Apple is the connectivity between its devices. After the setback of Apple TV+, Apple is likely to reversely support Apple TV by relying on other content advantages in the Apple ecosystem.

At WWDC 2019, Apple launched the game subscription service Apple Arcade and announced that it would be simultaneously available on Apple TV 4K; at WWDC 2020, Apple announced that Mac will move to ARM architecture in the future. One of the great benefits of this is that it can mobilize the full performance advantages of Apple's A series processors, and then share the rich content on the iOS side with other terminals, and allow other terminals to share higher-dimensional content.

According to online reports, the Apple TV 2020 will be equipped with an A14 processor, which is specially optimized for graphics display and supports running mobile games at 4K resolution.

Judging from Apple's various actions, it seems that it has seen the diversity of large-screen content and its own advantages and disadvantages, and thus hopes to let Apple TV 2020 show its prowess in gaming content and become a product similar to a home game console.

Newzoo data shows that the scale of iOS games reached US$33.5 billion in 2019, accounting for 49% of the global market share. For Apple, it is obviously a waste of resources for the iPhone to enjoy such a large piece of cake alone.

Of course, from this perspective, although the direction of Apple TV has changed, we can also find that Apple still hopes to operate Apple TV according to the successful "platform" strategy of iPod and iPhone.

However, under this strategy, the expansion of Apple TV's functions actually implies Apple's adjustment of its positioning in the next era. But whether this content and positioning will be consistent in the future remains to be tested by time.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.