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Can Apple’s next big innovation be the ‘one box for TV?’

Apple’s purchase of Israeli technology company PrimeSense for $360 million is perhaps an indication of where-next the technology king is headed. Given that PrimeSense is a global pioneer in ‘gesture technologies’; seen in smart phones and gaming consoles, it may be more than just an indication.

The Israeli company has previous success in this market as it provided some of the technology behind Microsoft’s hugely successful, Xbox, motion-sensing device; Kinect. Despite this Apple finds itself in slightly uncharted territory as it plays ‘catch up’ in the TV devices market.

The latest financial commitment is not a sudden lurch in a new direction but part of a two year old hint by chief executive Tim Cook, “as an area of interest.” Apple has previous in this market with its TV box released in March 2012, selling 13 million devices to date at $100.

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Yet even those who have purchased the device are wary of the underwhelming response with founder and CEO of Audience Bloom, Jayson DeMers are asking if, “anyone uses Apple TV any more?”

Apple will face problems with broadcasters and connected TV devices

A large portion of iTunes sales of movies and TV episodes come from Apple TV.  It has gradually acquired channels such as Sky News, HBO and ESPN among others to attract consumers. Yet many of these however are through ‘cord cutters’, who have replaced their cable subscription with Apple TV.

The problem for Apple is how far broadcasters and service providers will allow it to cannibalise their markets.  This will be the first major hurdle to clear as it aims to become the “one box for TV”, something which, the latest generation of consoles from Microsoft and Sony are at present better designed for.

Apple’s upcoming talks with Time Warner could perhaps involve a conversation about such an ambition. Given the brand reputation it carries, cable companies may well sense an opportunity to sell more expensive services through Apple.

The precedence of joining forces in teaming up with AT&T to sell the much vaunted iPhone is already there.  Yet as tempting and perhaps scary this all sounds for its competitors there are two major concerns that Apple has to contend with.

Firstly striking such deals are more a long-term project and given the latest consoles on offer, Apple is not the lead innovator it is so used to being.  If anything it is many moons behind.

Second and perhaps more significant is the tactic of joining forces which would mean Apple relying on competitor networks for quality of service. A risky bargain for a company which has so carefully crafted and managed its image of innovation combined with reliability.

Apple must develop ‘game changing’ device

It will also have to innovate away from simple connected TV devices given the hugely successful Google Chromecast, which at $35 has devalued the market. Google’s intervention has meant that increasing functionality of Smart TV devices to compete with laptops and PC’s does not really pay like many had hoped.

Furthermore the question Apple has to ask is what more can they give apart from the already expected? This is important for a company whose loyal consumer base has been built on game changing products, from the iPod to the iPhone and then the  iPad.

There have been voices calling for the next generation of TV’s to be more about the watcher as opposed to the machine being watched from. Apple may well move into the uncharted territory of creating the first social television network or making the arm-chair spectator an active agent in any event or action.

If it was to do such a thing it would continue the tradition of game changing offerings and conceivably become the dominant force in the TV market.

The purchase of PrimeSense could be the beginning of another of Apple’s never ending innovations that leave its rivals trailing. Just as likely perhaps is that TV alchemy may be one step too far.

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