Despite some rumours Apple published a 2nd generation AppleTV device and a HD video rental service today. It would be a good time take a quick look at how Apple has tackled the three crucial issues every online video provider needs to solve. You do not have to be a fanboy to acknowledge that the company is known for its attention to detail and with a good headstart from music they, if somebody, are likely to succeed in the global video services market.
The first generation video service flopped big time so now Apple has a lot to show. It would be fair to say that the earlier effort failed mainly due to the fact that you could not buy items directly using the device in the living room. Another issue that might have hampered a break-through was that the content selection was quite limited. The user interface was classic apple – simple and refined. However out of the three the first generation device obviously had trouble with two ie. content and authentication.
Now Apple has announced that all the major studios are taking part in the program. Naturally it will take a while before all content will be available through this distribution channel, but it is a very promising start. One can only wish that the platform will also open up to independent producers. Other than that there is very little to complain about. Apple has been working with iTunes and recommendations for so long that they will surely be able to leverage a sustainable competitive advantage from their experience with matching customer preferences.
In order to hone up the portal user experience it was essential that they made it possible to download movies directly without using a computer. Obviously users will still need to have an iTunes account. Whether the account can be created directly on the device is still unclear. Nevertheless Apple clearly believes it can count on a propriatory content protection and authentication systems. Being such a powerful player in media distribution today you have to agree that they will be likely to succeed using their chosen methods.
AppleTV really brings a new dawn in video distribution. It is perfectly obvious that the other players need to hurry in order to catch-up. It will not take long before all the same video services will need to be available throught-out all the device categories. There are only couple of global players that still make phones and home entertainment devices so competition will be scarce. Apple is doing a whole lot right now, so we will see if the final challenge, pricing (most likely dictated by the studios), will allow online video business finally flourish.