Let’s leave out the Bill & Ted jokes and instead talk about the third generation Apple TV. It’s still in many stores, like Target which displays a 4”x5” price tag for $69 and a tiny, little shelf-edge-sized tag for the $149 one. Apple’s site has “TV” in the bar across the top, and devotes almost all of the page to the new model, but at the bottom there’s a link to buy the previous generation, and a link to a comparison chart. The chart is entertaining because Apple couldn’t make it any clearer that they do not want you to buy the third generation model.
That is the Bezos graph of comparison charts.
A few possible reasons, in no particular order:
- They don’t want to say “Starting at $149”.
- They want to continue offering a sub-$100 AirPlay video experience.
- They want to use the large install base of the previous generation as a bargaining chip in negotiating content deals, potentially for their OTT service as well.
Remember that they made a big deal out of this price reduction in March at the same event when they made a big deal out of HBO Now. It’s not entirely unreasonable to assume that while the device will never see a significant update, it might still receive “channels” of content.
It’s still possible to argue that those arrangements could be done without selling the current device at all, but maybe those content partners are skittish about deals for a $149-199 box?
Let’s not forget that Apple has the second-most expensive streaming media box. Only the Sony FMP-X10 4K Ultra HD Media Player is more expensive at $699.99, but no one’s really buying that one so we’ll set it aside.
Many have made the case that next year, the fourth generation Apple TV will receive a discount to $99, when a fifth generation premieres. Everyone pulled $99 out of their butts, but it sounds like a good number. We don’t actually know if the device is even on a yearly refresh cycle at this point though since there’s no pattern. It is still conceivable that it may be the case, but that’s still a 40% price increase to the entry point.
Regardless, that still means they’re selling the third generation TV for a full calendar year until that happens. Does that seem absurd to anyone else?
On a recent episode of the podcast Clockwise, Anže Tomic posed the question about why Apple doesn’t have something more like the Chromecast, or like the streaming sticks of Amazon or Roku. If there really is a customer that just wants to stream stuff to their TV, then they’re currently best served by the third generation box — as sorry as that sounds. Jason Snell coined the term “AirPlay Express” as a half-joke to describe such a thing, and I agree that it would certainly help make the lower end make a bit more sense than the current situation.
My cohost on Unhelpful Suggestions, Marko Savic, has argued against such a thing because he doesn’t think Apple needs to compete in the low-end space. Apple doesn’t make $200 netbooks, so why sweat it? Why not just drive those people toward spending a little extra? The merit of spending any time or effort on an entry-level streamer is debatable, I just happen to fall in favor of Apple doing it. A large volume of streaming-only service devices that aren’t 4-5 years old seems like a decent thing to do to appeal to many people.
Let’s not forget people live in homes with more than one TV set, and while people like Bradley Chambers and Zac Cichy buy up fistfuls of fourth generation devices for every TV, there’s a market of people that will only buy one $149 device for the household. Why not fill every room a fresh Apple scent?