Even as it leans increasingly on the strength of its insanely lucrative iPhone business, the year ahead will likely be one of renewal for technology powerhouse Apple .
While we all know iPhone sales have never been better, it is also imperative that Apple tap into fresh revenue streams in order to keep its sales and profits on the up-and-up over the long term.
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And as the upcoming Apple Watch and widely anticipated on-demand streaming product have garnered the bulk of media coverage lately, word recently broke that another long-awaited Apple product remains very much alive. Get excited Apple investors.
Apple TV project: Back from the dead? For those that do not follow Apple closely, the analyst community, investors, and media have all been predicting or hoping that Apple will launch some kind of TV for years now. Lately, the thinking has shifted away from Apple actually manufacturing a physical television (hardware) toward Apple creating some kind of IP-based content product (software). And according to tech site Re/code, that is exactly what Apple is hard at work trying to create.
Apparently, Apple executives are now in discussions with several content providers to develop an Apple-branded streaming service. At a high level, it appears this potential Apple TV experience would strongly resemble your cable package today. Apple would bundle content in a single package that it would then sell directly to consumers. The reports claim that Apple has shown some, but not all, major programmers demos of its potential software. Nonetheless, this certainly should come across as encouraging for Apple shareholders.
Why this time could be different Although it has gained momentum slowly, the cable industry revolution consumers and industry analysts have long called for has picked up steam over the past few months.
After years of stonewalling, it appears the cable industry and content providers are finally ready to allow over-the-top services into the marketplace. Without question, the best example of this is Dish Network and its recently launched Sling TV, which functions much like what Apple is reportedly developing. However, Dish is not alone. Tech giant Sony is also close to launching its own streaming cable service as well.
The real takeaway here is that the slow thaw of the largely unsustainable (great read here) cable industry appears to have finally given way to what is easy to see will be a significantly improved consumption model. It appears we have finally reached that critical mass moment where the obvious improvements to the TV industry experience actually begin to materialize.
And with the all-star media team at Apple looking stronger than ever in light of the Beats acquisition last year, it is exciting to think about the financial opportunity this could create for Apple shareholders.
Not disruptive but hugely exciting Obviously, the powerful cable companies are not going to go quietly into the night. According to Re/code, the content bundle deals they are offering stop short of allowing access to key programming, most likely the increasingly coveted live sports content.
However, so long as they are able to access most programming, it follows that these over-the-top services could create a new and compelling business for the likes of Apple. For starters, tech companies have a deeper expertise in software and user interface design, which they could leverage to create the optimal consumption experience modern cable utterly lacks.
Speaking personally, I hate my Time Warner experience in no small part, because the software that powers its service, for lack of a better word, sucks. It is no accident that Comcast and Time Warner consistently rank at or near the top of the annual Most Hated Companies in America lists. I wouldjump at the opportunity to jump ship should a better service present itself.
This also becomes exciting when considering not only the number of registered Apple users but also its massive iPhone installed base. It is fairly obvious that a dedicated Apple TV product could go a long way to increase the already-massive stickiness of the Apple ecosystem.
But it is important to remember that we are still in the very early innings of this narrative. However, the prospect of such a product is also so attractive that it is one Apple investors will want to watch closely as it unfolds in the coming months.
The article Apple Inc. TV Rumors Resurface: Here We Go Again originally appeared on Fool.com.
WhileAndrew Tonnerwatches his fair share of TV, he's no couch potato. Andrew also owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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