How Apple will turn the Net’s top into TV’s bottom

Apple TV (whatever it ends up being called) will kill cable. It will also give TV new life in a new form.

manhole coverIt won’t kill the cable companies, which will still carry data to your house, and which will still get a cut of the content action, somehow. But the division between cable content and other forms you pay for will be exposed for the arbitrary thing it is, in an interactive world defined by the protocols of the Internet, rather than by the protocols of television. It will also contain whatever deals Apple does for content distribution.

These deals will be motivated by a shared sense that Something Must Be Done, and by knowing that Apple will make TV look and work better than anybody else ever could. The carriers have seen this movie before, and they’d rather have a part in it than outside of it. For a view of the latter, witness the fallen giants called Sony and Nokia. (A friend who worked with the latter called them “a tree laying on the ground,” adding “They put out leaves every year. But that doesn’t mean they’re standing up.”)

I don’t know anything about Apple’s plans. But I know a lot about Apple, as do most of us. Here are the operative facts as they now stand (or at least as I see them):

  1. Apple likes to blow up categories that are stuck. They did it with PCs, laptops, printers, mp3 players, smartphones, music distribution and retailing. To name a few.
  2. TV display today is stuck in 1993. That’s when the ATSC (which defined HDTV standards) settled on the 16:9 format, with 1080 pixels (then called “lines”) of vertical resolution, and with picture clarity and sound quality contained within the data carrying capacity of a TV channel 6MHz wide. This is why all “Full HD” screens remain stuck at 1080 pixels high, no matter how physically large those screens might be. It’s also why more and more stand-alone computer screens are now 1920 x 1080. They’re made for TV. Would Steve Jobs settle for that? No way.
  3. Want a window into the future where Apple makes a TV screen that’s prettier than all others sold? Look no farther than what Apple says about the new iPad‘s resolution:
  4. Cable, satellite and over-the-air channels are still stuck at 6MHz of bandwidth (in the original spectrum-based meaning of that word). They’re also stuck with a need to maximize the number of channels within a finite overall bandwidth. This has resulted in lowered image quality on most channels, even though the images are still, technically, “HD”. That’s another limitation that surely vexed Steve.
  5. The TV set makers (Sony, Visio, Samsung, Panasonic, all of them) have made operating a simple thing woefully complicated, with controls (especially remotes) that defy comprehension. The set-top-box makers have all been nearly as bad for the duration. Same goes for the makers of VCR, DVD, PVR and other media players. Home audio-video system makers too. It’s a freaking mess, and has been since the ’80s.
  6. Steve at AllThingsD on 2 June 2010: “The only way that’s ever going to change is if you can really go back to square one and tear up the set-top-box and redesign it from scratch with a consistent UI, withall these different functions, and get it to the consumer in a way they are willing to pay for. We decided, what product do you want most? A better tv or a better phone? A better TV or a tablet? … The TV will lose until there is a viable go-to-market strategy. That’s the fundamental problem.” He also called Apple TV (as it then stood) a “hobby”, for that reason. But Apple is bigger now, and has far more market reach and clout. In some categories it’s nearly a monopoly already, with at least as much leverage as Microsoft ever had. And you know that Apple hasn’t been idle here.
  7. Steve Jobs was the largest stockholder in Disney. He’s gone, but the leverage isn’t. Disney owns ABC and ESPN.
  8. The main thing that keeps cable in charge of TV content is not the carriers, but ESPN, which represents up to 40% of your cable bill, whether you like sports or not. ESPN isn’t going to bypass cable — they’ve got that distribution system locked in, and vice versa. The whole pro sports system, right down to those overpaid athletes in baseball and the NBA, depend on TV revenues, which in turn rest on advertising to eyeballs over a system made to hold those eyeballs still in real time. “There are a lot of entrenched interests,” says Peter Kafka in this On the Media segment. The only thing that will de-entrench them is serious leverage from somebody who can make go-to-market, UI, quality, and money-flow work. Can Apple do that without Steve? Maybe not. But it’s still the way to bet.

Cable folks have a term for video distribution on the net Net. They call it “over the top“. Of them, that is, and their old piped content system.

That’s actually what many — perhaps most — viewers would prefer: an à la carte choice of “content” (as we have now all come to say). Clearly the end state is one in which you’ll pay for some stuff while other stuff is free. Some of it will be live, and some of it recorded. That much won’t be different. The cable companies will also still make money for keeping you plugged in. That is, you’ll pay for data in any case. You’ll just pay more for some content. Much of that content will be what we now pay for on cable: HBO, ESPN and the rest. We’ll just do away with the whole bottom/top thing because there will be no need for a bottom other than a pipe to carry the content. We might still call some  sources “channels”; and surfing through those might still have a TV-like UI. But only if Apple decides to stick with the convention. Which they won’t, if they come up with a better way to organize things, and make selections easy to make and pay for.

This is why the non-persuasiveness of Take My Money, HBO doesn’t matter. Not in the long run. The ghost of Steve is out there, waiting. You’ll be watching TV his way. Count on it.

We’ll still call it TV, because we’ll still have big screens by that name in our living rooms. But what we watch and listen to won’t be contained by standards set in 1993, or by carriers and other “stakeholders” who never could think outside the box.

Of course, I could be wrong. But no more wrong than the system we have now.

Bonus link.



  1. Andrew Leyden’s avatar

    Cable’s death, or medically-induced coma with ESPN as the feeder tubes, has been hinted at for years now, as more and more geeks ‘cut the cord’ and throw up everything from Rokus to Apple TVs to Mac Minis on their televisions. But lately, and rather quietly actually, a much clearer path to ‘what is coming’ has been apparent from Apple in the guise of “AirPlay”.

    For those who have an Apple TV, or using software like AirServer on their Minis, the ability to ‘AirPlay’ content from an iOS device to the television has been revolutionary. Suddenly each of those television apps, from France24 to NHK International to Al Jazzeera has become ‘a tv station’ that can be played back on the big screen with the simplicity of using a remote control. When you start using aggregator apps, like PPTV and the like (and fwiw, the Chinese are light-years ahead of us on this) you start to see entire ‘packages’ of TV channels being available through app-based, iOS interfaces. Apple TV is basically ‘Direct TV without the satellites’ and the juggernaut that is coming down on cable and satellite providers is going to be huge.

    And who is next? Trying playing Angry Birds on your widescreen via AirPlay mirroring, and then think about the console game industry. It’s not going to be instant. Not now, not next year, but soon? Hell yes.

  2. francine hardaway’s avatar

    From your lips to God’s ears. I Airplay Gillmor Gang and TWIT and old episodes of The Big C. I never watch my TV except in a news emergency. Streaming news like Al Jazeera that covers more than the Middle East will finish me off for cable.

  3. Doc Searls’s avatar

    Thanks, Andrew. Thought about bringing up Airplay, but have had no experience with it, so passed. There is so much that can be said here. Thanks for clue-ing us into some of the most important stuff.

  4. Steve McNally’s avatar

    Excellent headline.

    We all want Apple to blow up CableCos, set top boxes and TV OSes. This is partially why there’s wishful thinking here.

    When Isaacson’s Steve Jobs bio came out, Jean-Louis Gassée jumped on the “I’ve finally cracked it” quote with solid insight and analysis.

    There’s similar thoughts in that piece as this one. I hope you’re both right sooner rather than later.

  5. Rex Hammock’s avatar

    I use Airplay / Apple TV so I glimpse the future, also. However, then I remember that I’m getting my broadband access via Comcast and I realize KableTown will still be in the equation.

  6. Doc Searls’s avatar

    Thanks, Steve. The Jean-Louis Gassée piece is astute, revealing, and points in a very Steve-ian direction. The comments are all good too. People should go there and read through it.

    Rex, the scene that comes to mind is the one in the board room in the movie “Network,” where Mr. Jensen explains to Howard Beale, his hyper-idealistic visionary anchorman, how the world really works. The particulars are dated in the extreme, but he could as easily be talking about Comcast, AT&T, Verizon, Time-Warner, Disney, the FCC, the FTC — and Apple. Because Apple is in fact one of the Big Boys. As of today, it may be the biggest. Gone are the days when Apple gear had single-digit market shares. Outside of large corporations that have to use Windows, Apple’s market shares are now huge enough to bring real leverage.

    Still, Comcast could be a Bad Boy-enough company to screw up whatever Apple wants to do. But the sand in cable’s hourglass is flowing steadily, and each grain is a cut cord. At some point all Tim Cook has to do is look Comcast in the eye, point to that hourglass, and raise one eyebrow.

  7. abm’s avatar

    Please don’t make us go back to square aspect ratio! I assume you are just talking about the amount of pixels in point 3, not the distribution of them.

    But that does bring up the point, where is all this ultra hi-res content you refer to come from? Last I checked my Apple TV HD was way less pretty than my 1080p bluray disks.

  8. Doc Searls’s avatar

    abm, correct, I was talking about exceeding 1920 x 1080, not deviating from 16:9. But I wouldn’t put anything past Apple. No telling what they have in mind, other than breaking a mold that’s going on 20 years old.

    The content is another thing. Movies, including all your BlueRays, are 1080p these days. But other days will come. I am sure that Steve Jobs coveted 4K resolution; and I would be surprised if that’s not on Apple’s roadmap already, even if it’s years out.

  9. Jim’s avatar

    I’m thinking of dropping my ridiculous UVerse TV and just keeping the data. Or going to another provider for that bandwidth, while getting one of those Hoppers with satellite TV. Anything to strangle the “bundling” idiots.

  10. Dana F. Blankenhorn’s avatar

    I think you’re absolutely right, Doc, and WWDC 6 seems like the logical place for this announcement to be made.

    But higher resolution doesn’t necessarily mean higher quality. People can look worse with higher resolution, for starters.

    So we will see what happens. But I’m going to bookmark this and check in again after the announcements.

  11. Jim Spencer’s avatar

    I read a recent article on the Wrap about the major studios and how they earn about ten times the revenue from TV as compared to movies. This came on the heals of an Atlantic article explaining the tight revenue model between the cable company and HBO and why television viewers will never see HBO Go sold separately. It seems there is a revenue model here that is like a vice-grip. How will Apple dodge that ball?

  12. William Maggos’s avatar

    Are you predicting that this revolution will boil down to trading in Cabletown for whatever is on iCrap?

  13. francisco’s avatar

    I do agree mr Searls, I call TV “that thing u used to call TV set in your saloon”

  14. Doc Searls’s avatar

    William, in the short run, yes. In the longer run, we trade in Cabletown for Internetworld.

    Jim, Apple won’t dodge that ball, any more than they dodged a ball with the music recording industry. Instead they’ll pose a new distro system that will not only outperform the old one revenue-wise, but look a lot better and be a lot easier to use.

    BTW, to other commenters: I’m not advocating this, just predicting it.

  15. Doc Searls’s avatar

    Dana, WWDC didn’t produce what I described, but I didn’t expect it this soon, either.

    The main point stands, however. I cannot believe that Apple will sit still and tolerate a world contained in 1080p.

    BTW, over the weekend I talked with a producer who said the most innovative movie-makers are aiming toward not only higher resolutions but higher frame rates as well.

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