Amazon Set Top Box Competitors: Apple TV
Over the years since the Apple TV’s initial release in 2007, Apple has honed the Apple TV experience, dramatically shrinking the hardware, adding 1080p HD support, cutting the cost, improving the UI and building content — not just from its own iTunes, but also through third-party support from Netflix, YouTube and others.
Apple iOS owners can also stream Amazon Prime video from their iPads and iPhones to their Apple TV via the Prime iOS app and AirPlay.
Amazon may find the Apple TV a tough nut to crack. An Amazon set top box could boast Prime video without having to undertake the extra step of streaming from a tablet. Adding game support (as an Android box connected to Amazon’s app store) as rumored would definitely be an advantage, although Apple seems likely to eventually counter that with an iOS games-enabled Apple TV. Pushing original content — something Apple lacks — is also a possibility.
In these days of bandwidth and download speed uncertainty, adding a USB 3.0 port and support for plugging in a thumb drive or external hard drive to physically store purchased video (instead of having to stream it each time or connect to a computer with an iTunes library) is a feature than many Apple TV owners have requested over the years — in fact, the first-generation Apple TVs had a 160GB hard drive built in for just this purpose, a feature lost during cost-cutting and device-shrinking. Amazon could offer it.
AMZN’s best play may simply be to repeat what it does with its other hardware: Undercut the Apple TV’s $99 price tag by selling its Amazon set top box at cost or a loss. It may not capture existing Apple TV owners, but that could take a big chunk out of Apple’s future sales.