Analyst predicts lower-cost Apple TV on the way

A version of the HBO Max app running on an Apple TV device.
A version of the HBO Max app running on an Apple TV device. (Images courtesy Warner Bros. Discovery/Apple, Inc.; Graphic by The Desk)

Will Apple release a new, low-cost version of its streaming device Apple TV? That largely depends on whether you believe the rumors or not.

Last week, technology blogs were alight with news that Apple may release a cheaper version of the Apple TV in the future, which would help it better compete with budget devices offered by Roku, Amazon and Google.

Each of those three companies sell powerful streaming devices, with the average price of a 4K-capable streaming dongle hovering around $50 (Roku sells streaming devices for as little as $20, and sometimes less during Black Friday, while Amazon’s Fire TV devices are often on sale for around $20 or $30 a piece).

Apple, on the other hand, has always chosen to target consumers who are willing to drop hundreds of dollars on its phones, tablets and computers — so why should streaming devices be no different? Its latest streamer comes in three variants, with the base HD model clocking in at a whopping $150.

Apple fans say the hardware is well worth the premium: The ad-free home screen sets it apart from everything else on the market, as does the premium internal circuitry that sports Apple’s own high-end processors found in many of its iPhones and iPads. Even the first-generation Apple TV HD device released in 2015 is still supported by the company, with regular operating system updates and the latest apps supported — some Roku devices can’t even make that claim.

Still, those cheap streamers have an outsized command of the space, with Roku Amazon together accounting for 80 percent of the domestic streaming TV market. Apple finds itself in the unusual position of being a distant fourth out of four — and a cheaper streaming device could help it move ahead.

Last Friday, Apple analyst Ming-Chi Kuo said that’s exactly where the company is headed, tweeting that Apple “will launch a new version of Apple TV that improves cost structure” later this year. He did not offer any insight into what that price point would be, nor did he suggest what the streamer might offer in the way of hardware or features.

Kuo, who weaves supply chain data with financial trends as the basis for his analysis, has a decent track record when it comes to predicting future Apple gadgets and features. Last year, he claimed new iPads would come with 20-watt charging bricks — and they did. He also forecasted the release of new MacBook Pro laptops with mini-LED displays — and that happened, too.

Other guesses sputtered out, including a prediction that Apple would launch an iPhone SE Plus in 2021 (the company instead released a new iPhone SE model that supports 5G networks) and one that said Apple would offer a wearable called Apple Glass in 2020 (it’s been two years and that still hasn’t happened).

Still, a cheaper Apple TV would not be without precedent: The second-generation Apple TV model, which offered access to Netflix and Hulu but didn’t come with an App Store, cost $100 and was eventually reduced to $70 when the third-generation, app store-capable third generation model was released.

But cheaper devices often come with compromises, and it’ll be interesting to see what Apple decides to reduce or eliminate for the sake of a lower price point — if the rumors are true.