Today there is an interesting report regarding Apple (NASDAQ:AAPL) on TheStreet.com discussing the company's plan to produce an HD Smart TV. As we initially hypothesized in "Apple Revolution" over two years ago, an Apple brand television is the next logical step for the Apple ecosystem. We expect Apple will be the first to truly utilize the two way communication capabilities of an Internet connected TV.
Expect a new App Store for the TV, expect cloud functionality of MobilMe, expect FaceTime, etc. ... all of it will redefine what consumers expect from a television. The iPod turned the music industry upside down, the iPhone turned the mobile phone industry upside down, the iPad is dominating the tablet computing market and the Apple TV will follow suit. Those who claim that Apple’s best days are behind it fail to understand that this is no longer a product based company. Apple has become a platform. This platform is the best in tech and it opens the door to unlimited expansion into TVs, cars, appliances ... whatever they want. We don’t anticipate this TV will arrive in 2011 as TheStreet.com suggests. However, we do think it will launch in 2012 along with Apple’s first 4G iPhone and iPad.
The unspoken truth regarding Apple is that as a platform company it doesn't need new products as often as it currently provides them. Current users are more than content with regular software updates that keep them up to date with the latest platform enhancements. Hardware launches actually disrupt the global supply chain more than they help as it freezes potential buyers and subsequently causes new product shortages. On a global scale Apple is doing all they can to meet demand. We still don’t think they can meet the iPhone 4 demand in China. And everyone is worried about the iPhone 5? Sometimes the things investors worry about are so trivial. Apple as a platform company is best judged by quarterly earnings reports rather than product launches.
Disclosure: I am long AAPL.