21 OCT 2022

Is Apple TV failing to compete with rivals’ similar and cheaper devices?

Sales of new Apple TV 4K will remain low as it fails to compete with rivals’ similar and cheaper devices, according to Ardit Ballhysa, Technology Analyst at GlobalData.

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Days ago, Apple announced the next generation of Apple TV 4K which, according to the company, is “more powerful, entertaining, and affordable than ever, and offering impressive cinematic quality.”  Driven by the A15 Bionic chip that delivers faster performance and more fluid gameplay, the new Apple TV 4K features more entertainment options for everyone to enjoy on the biggest screen in the home.

“Compared to rival offerings, Apple’s TV lineup is lacking in diversification as it does not have its own competitively priced streaming stick, which would better compete with its competitors. By not having a streaming stick in the same price bracket, Apple is overlooking the budget-conscious consumer base and those looking for a more affordable way of building deeper integration across their existing Apple devices,”  analyzed Ardit Ballhysa, Technology Analyst at GlobalData.

According to Ballhysa, the company would therefore stand to benefit from differentiating its Apple TV lineup by releasing its own competitively priced streaming stick to better compete with its rivals. For example, it could position the Apple TV 4K set-top box as direct competition to the Roku Ultra, which retails for US$99.99, and the Fire TV Cube, which retails for US$139.99.

“Aside from the high price limiting adoption rate, smart TVs are also a headwind for Apple. With smart TVs becoming increasingly smarter and coming pre-loaded with thousands of apps, and streaming platforms such as Roku, Google, and Amazon licensing their software to TV manufacturers, streaming devices are gradually losing market share and this will prove a challenge in Apple’s smart home push,”  Ballhysa said.

“A noteworthy redaction in the entry model Apple TV 4K is the support for the Thread networking protocol. It could be the case that Apple omitted support for the protocol in its entry-level model to encourage customers to purchase the more expensive higher-end model or to keep component costs down. However, by doing so, Apple has potentially dampened its prospects in becoming customers’ platform of choice for their smart home hub,”  the Technology Analyst at GlobalData added.