If you think everything is converging, Apple’s Cinema Display line is approaching and exceeding small television sets. So I can see how Apple might have the factories available to manufacture a true Apple TV.
Most pundits look at whether or not Apple thinks there’s a market or a some other economic reason for building a product. I don’t think that’s true. If Apple cared about the market, Safari would be going toe-to-toe with Chrome on features and functionality. If Apple cared about the market, they’d be much more aggressive trying to get Macs on everyone’s desks instead of PCs. If Apple cared about the market, they would have set a much higher goal for the iPhone than just 1%.
I’m sure whether a market exists or not factors into their decisions on products, sure, but they don’t start there and build a product. They start by identifying what sucks and then identifying the market potential.
Apple thought IBM computers sucked, so they built the Mac. Apple thought Internet Explorer sucked, so they built Safari. Apple thought notebooks sucked so they built the iBook. Apple thought keyboard and mouses sucked, so they made their own (hold your “the mouse still sucked” jokes for later). Apple thought routers sucked so they built Airport. This can go on and on with iPods, software like iMovie and iPhoto and more.
There’s one product that I think Apple will base their approach on: The Apple Hi-Fi. Remember that thing? Apple thought stereos sucked so they built one to use an iPod instead of a radio, CD or cassette. There were plenty of third-party stereos with iPod docks on the market, but Apple evidently thought they sucked. I can imagine Steve Jobs wanted to listen to his music in a room and he probably cringed at having to stick his beautifully crafted iPod into an alarm clock/AM, FM radio/CD player/white noise machine/flashlight thing.
I think the TV is the same. Apple’s curated this wonderful content into iTunes and they wanted a beautiful way of sharing it with a person’s living room TV and rather than build their own glass box, they went with the comparatively ugly TV screens that abound and made what is now the Apple TV. They learned their lesson from the Apple Hi-Fi and I don’t see them making the same mistake over again with TVs. People sometimes have more than one stereo in the house and they don’t upgrade it every year. The same goes for TVs.
Steve Jobs has said the Mac is the center of your media universe. That’s not likely to change despite most people claiming the TV is the center of their media universe. Apple’s where they want to be: your Mac is the center of the universe and you control everything in iTunes from there. Apple TV, iPads, iPods and iPhones are arms of that. They just happen to be able to access the same content.
While I don’t doubt that Steve probably cringes every time people fire up iTunes in their Apple TV on their boxy Sony Trinitron, Apple’s created the ecosystem they’ve said they wanted. I suspect they’ll stay there and focus their attention someplace else. Personally, I hope to see them put some pressure on cable companies by getting everyone to think differently about the content they watch and purchase.