Sony recently announced aggressive price points for its all-new XBR 55" and 65" 4K Ultra HDTVs. Sony will be launching the 55" base model for a seemingly jaw dropping $4,999, while its largest 84" set continues to drop jaws for the exactly opposite reason, coming in at $24,999.
Rumors continue to swirl about Apple entering the market with an all-in-one Apple TV plus HDTV device rumored to be called "iTV." Assuming Apple dives into the living room, a recent article by Mark Hibben sheds some light on why Apple would be wise to jump into the game with its own 4K set (displays with 4x more resolution than current 1920 x 1080 HDTVs).
When breaking into new markets, Apple has a history of leapfrogging the competition’s incremental steps. The iPod’s amazing storage capabilities delivered Apple MP3 domination. The iPhone single handedly destroyed the once dominate physical keyboard phone market, and the iPad quickly wiped out the netbook world.
Today’s buzz is all about how Apple will take on the stalwarts of the TV display industry — and win?
One approach is for Apple deliver an onslaught of well designed interface tools. Siri control, built-in Facetime or getting ABC/Disney and others to join up in selling networks al-a-carte through Apple’s iTunes service. Direct content and interface enhancements are strong arguments that could prove successful for an Apple HDTV, but Apple’s core strength when entering new markets has been the ability to blow away the competition with new hardware that just can’t be ignored.
Hardware is what grabs the attention of the low-information consumer, forcing them to tune in and engage. It is Apple’s new hardware that continues to pull sales their direction over and over again. The sexy marketing hook that will simply be too powerful to ignore is an Apple 4K set. And while many have unsuccessfully tried to predict when Apple will launch into the living room with their own branded TV, Apple has shown that timing isn't always critical for their success. Apple let the MP3 player, the smartphone and netbook develop for quite some time before they unleashed game changing products. Whether Apple strikes this fall or next spring makes little difference, because Apple has one weapon the rest of the industry will not be able to compete against.
When Apple launched the iPad, the industry was lead to believe that any form of tablet Steve Jobs were to introduce would start around $999, reaching towards $1,500 or beyond. Apple sent the entire industry back to the drawing board due to the iPad's $499 pricing. By the time Android tablets found their low-end niche, iPad had become the de facto tablet world wide.
Regardless the number of 4K sets that enter the market this year, when Apple arrives it is likely to best them all with an amazing price. LG currently sells an 84" 4K set for $20,000 ($16,999 at Amazon) and Sony's 84" set retails for a staggering $24,999, which won't bother Apple either.
Apple has no interest in targeting niche segments or bleeding into markets at a snails pace, as traditional technology companies like Sony do in order to mitigate risk while slowly paying off high R&D costs. While Sony is content to continue the tradition of bleeding new technology into markets, Apple disrupts them. Pricing is the very reason Apple has invested billions into Sharp. When Apple arrives with their 4K TV, it will be at price points the average family can find ways to justify.
Sony is trying its hand at being aggressive by launching their XBR 55" 4K set at $4,999, but this doesn't approach the mass market. Instead, Sony is only helping to turn heads towards the 4K market, setting the table for Apple dominance with a 60" 4K TV, around $1,999. Demand for an Apple branded set at the right price is also in the mix. The consulting firm Accenture recently released a report revealing 29% of US consumers would purchase an HDTV if Apple made one.
When Apple enters the HDTV space, it will leapfrog most of the industry with 4K resolution, while delivering a price point no rival will be able to compete with for at least or more. And even when others do begin to catch Apple on price, what integrated device will work like Apple's solution? None. Sony may be able to turn heads, but Apple will be the one selling sets.
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