If you’ve been following tech for a while, you know that rumors about Apple building a TV ran rampant for years — mostly driven by former analyst Gene Munster, who asked about it so many times on quarterly financial calls that it basically became a bingo square. Steve Jobs fueled the fire by telling his biographer that he’d “cracked it” right before he died, and Tim Cook spent 18 months saying TV was an area of “intense interest” in 2011 and 2012.
But after all that, the only TV products Apple’s ever produced are a series of Apple TV boxes and a couple of extremely middling reality shows. The HD flat panel business just never made any sense for Apple at the time: it’s a cutthroat, low-margin business, it’s impossible to fully own the interface because consumers plug so many things into their TVs, and the upgrade cycle is glacial compared to phones and even laptops.
But after reviewing the new Apple TV 4K, I think it’s time to rethink some of those assumptions. A combination of changing habits around TV consumption, new technology, and consumer confusion means that there’s a big opening for Apple to upend the entire TV market.
New tech: Variable refresh rate displays are here
One of my biggest issues with the new Apple TV 4K is that it doesn’t automatically switch the mode your TV is in to match the content. It’s one of the biggest and longest-standing issues in the living room: you want to run the TV display at a refresh rate of 24Hz when you watch 24fps movies, but animating a user interface at 24Hz looks like garbage. Apple and others deal with this issue by running everything at 60Hz, but that creates visual issues for 24fps movies — kind of silly because you buy all this stuff to watch movies, not menu animations. There are endless forum threads about adjusting TV settings to handle the motion problems that come with playing 24fps video at 60Hz.
At the same time, Apple recently introduced the ProMotion display on the iPad Pro, which dynamically varies the refresh rate of the LCD panel to match the content being displayed. When you watch a movie, it slows down to 24Hz to match the 24fps frame rate of most movies, and when you’re scrolling around a web page or playing a game, it can ramp up to 120Hz for maximum smoothness.
Apple already ships more variable refresh rate displays than anyone
So, what if Apple made a TV with ProMotion that dynamically adjusted the refresh rate for the content being displayed, just like the iPad Pro? It would run at 120Hz on the homescreen and in games, slow down to 24Hz to display movies and TV perfectly, and ramp up again when you hit the home or Siri button to bring up the interface again. And live sports apps like NFL Sunday Ticket and MLB At Bat could run at 60Hz for smoother motion — the Xbox One Sunday Ticket app already runs at 60Hz.
Similar tech exists outside of the Apple ecosystem — TV manufacturers were already looking at AMD’s Freesync PC display system as the foundation of a new variable refresh standard for TVs. And variable refresh rate is actually part of the HDMI 2.1 spec, which was supposed to be out this year but has been delayed by the usual standards politics.
But building a variable refresh rate TV isn’t easy — it requires throwing a lot of assumptions about how a TV works out the window, and I’m told it can’t just be added to existing TV designs. Everything from the processor to the display panel itself has to be rethought and redesigned. If it shows up anywhere soon, it’ll be at the high end of the TV market.
That certainly sounds like an opportunity for a tech company that sells high-end hardware tightly integrated with custom software. Especially a company that’s already engineered ProMotion and is already shipping more variable refresh rate LCDs in its iPad Pros than anyone else.
Changing habits: Prestige TV streaming has ended the input one problem
For years, the biggest problem with Apple making a TV was that the cable box was the most important part of the overall TV experience — who cares about a really nice TV interface when you’re just looking at a cable box grid guide all the time? Whatever you plug into HDMI input one becomes the de facto TV interface, which is why, say, the Xbox One has an HDMI passthrough so it can sit between your TV and your cable box. Microsoft wants to live on input one.
But cable box dominance is over, and more people are cutting the cord every year. Hulu is out there winning Emmys. Amazon and Netflix have won Oscars. The built-in apps for these services on new 4K HDR smart TVs are actually pretty good — most of them run variants of mobile operating systems now, and the apps reflect that. Samsung TVs run Tizen; Sony TVs run Android. LG’s reworking of webOS for TVs features a delightfully tragic animated setup assistant named Bean Bird and an actually-good motion control remote. Amazon and Roku are building TVs that run their OSes as well; one of the best TVs of the year is a $600 Roku TV.
You don’t need any external boxes with modern smart TVs
So instead of turning on a TV and seeing a cable box UI, more and more people are buying a new TV and seeing the built-in OS and apps. Our tech team has been noting for a while now that you often don’t need an external box if you buy a new smart TV anymore: the built-in Netflix and Amazon apps will be just as good as anywhere else. As an external box, the Apple TV competes with those built-in apps and interfaces.
But building tvOS into an actual TV puts it front and center: you’ll turn on a new TV and see Apple’s TV app, which looks more like the future of the TV interface than anything else on the market. Compared to every other smart TV platform, tvOS is miles ahead: it’s based on iOS, which means it has tons of clever, polished apps and games. This would be no contest.
The other option is for Apple to make iTunes apps for other platforms to ensure distribution of its own original content, and that just doesn’t seem likely.
Consumer confusion: 4K HDR is confusing as hell
Figuring out what TV to buy and how to make it look good has always been confusing, but 4K HDR is a new kind of confusing, and that’s always an inflection point that creates opportunities.
HDR — particularly Dolby Vision — looks amazing. It represents a major upgrade over HD, and modern panels are thin, beautiful, and draw far less power than older TVs. If anything is going to drive another major upgrade cycle for TVs, it’s going to be 4K HDR.
But the competing HDR standards are confusing, various devices and services offer differing support, and a lot of early HDR content has mastering issues. And TVs come out of the box with insanely stupid default settings designed to make them look good in big box stores, not faithfully playing movies and TV in living rooms. Apple’s influence over the entire chain — from dictating how Hollywood studios encode content for iTunes to knowing how to properly calibrate LCDs — means that it could sell a 4K HDR TV that is guaranteed to work with Apple’s chosen standards and look exactingly perfect out of the box.
A TV that has a best-in-class interface, access to a full range of properly-mastered content, and requires zero trips to the settings menu to look amazing? I’d buy that in a heartbeat.
Now, I don’t think Apple is actually going to make a TV: the margins will always be low and it’s a lot simpler to sell external boxes people can upgrade every couple years than giant wall-mounted displays. But the window for Apple to make this kind of move is opening again right now. I hope Tim Cook and Eddy Cue see it.