With streaming wars between content providers in full swing and a growing number of households watching content on their TVs, there is a strong market need not only for streaming services, but also for set-top boxes enabling convenient access to services –  replicating the ease of using a regular TV. Apple, alongside companies such as Roku and Amazon, has entered the OTT market as both hardware manufacturer and – more recently – a streaming platform provider. The Apple TV Plus service costs $4.99 monthly, but is free (for the first year) for those who recently bought an iPhone, iPad, Mac or an Apple TV 4K.

It’s a smart move to monetize the company’s impressive market presence and undercut veteran competitors like Roku and Amazon through leveraging Apple’s established position on the market and experience producing high-end hardware.

In this short article, we will take a closer look at the Apple TV hardware, give you a quick overview of the OTT landscape and help you understand how Apple TV fits into it.

Apple TV

Source: Apple

What is Apple TV and how does it work?

Much as we’d love to see Apple make their foray into the TV market, Apple TV is not a TV. Instead, it’s a set-top box which allows consumers to access OTT content on their TVs. 

Apple TV uses the HDMI port to connect to your TV and brings the magic of streaming to the big screen in your living room. It also comes with a Siri-enabled remote which further integrates the TV watching experience with the Apple ecosystem.

But first things first…

What is OTT?

OTT content is offered to viewers via the internet, bypassing cable, broadcast, and satellite television platforms, and increasingly bypasses all the companies which traditionally acted as controllers or distributors of such content. Examples of OTT content providers include Netflix, Hulu, Disney+ and Amazon Prime Video. 

Because the number of households not yet connected to OTT services is dwindling, many of these providers are now also focused on creating more advanced hardware and producing their original content to lure new subscribers.

You can access OTT content using:

  • Internet-connected devices (Android and iOS mobile phones, smart TVs),
  • Set-top boxes connected to TV (such as Apple TV, Nvidia Shield, Fire TV, and Roku)
  • Gaming consoles, 
  • Tablets, desktop computers and laptops. 

The state of the OTT market

The global OTT market size (both devices and content) was valued at USD 56.40 billion in 2019 and from 2020 to 2027 it’s expected to expand at a compound annual growth rate (CAGR) of 18.6%. 

As of 2020, Android and iOS users make up more than 45% of the total OTT content streaming audience, while 39% of users use the web to access OTT content.

The increasing growing demand for high-quality streaming content is driving the growth of the OTT media services. Customers are after higher accessibility, connectivity, convenience, and portability.

Do I really need an Apple TV to access OTT content?

With Apple TV connected to your TV via HDMI, you gain access to a variety of streaming apps and services on your nice big TV screen. 

Apple TV is behind the other OTT players such as Amazon Fire TV, Roku, Google Chromecast in terms of 4K and HDR capabilities. Also, don’t expect a USB port for playing your personal media on an external drive (a typical Apple move). Needless to say, Apple TV devices also carry significantly heftier price tags than the competition.

But do you really need it? What are the alternatives? There are many ways to get your streaming Web video on the TV other than through Apple TV. Let’s have a quick look:

  • Your good ol’ gaming console

If you own a Microsoft Xbox or Sony Playstation, you most likely can access a variety of streaming video apps like Netflix, YouTube, Amazon Instant Video, ESPN and more without spending a penny. The gaming pad will serve as a remote just as well.

  • Smart TVs

Most TVs manufactured today are “smart”, and while you can install streaming apps on the TV itself and will be just fine, the experience is far from Apple’s signature, class-leading user experience. This explains why so many people still decide to purchase an OTT device like Apple TV in spite of having a smart TV which provides an array of streaming apps like Netflix or HBO out of the box.

  • Google Chromecast TV

Google’s recently released Chromecast TV is a direct competitor to Apple TV which seamlessly integrates with the Google ecosystem.

  • Other OTT boxes and TV streaming dongles

In terms of other set-top boxes, Apple’s biggest competitor in this space is Roku. The cheapest Roku Stick costs just $50. Amazon Fire TV and other less popular streaming media players offer the same basic features at much lower price points. Amazon’s Fire TV stick costs just $39 and streams a lot of the same popular apps. You can also get the $30 Amazon to use voice to search for videos and other content. This only goes to say that Apple has lost the bleeding edge in many areas and the choice of the OTT box is not as important as one might expect.

Bottom line: Apple TV is certainly not leading the charge in OTT and there are plenty of alternatives on the market. The key differentiators for Apple is the AirPlay feature and the possibility to use Siri to use voice to input text with your voice. Apple TV can be recommended to those users who are heavily invested in the Apple ecosystem (own an iPhone, iPad, lots of purchased iTunes, Apple Music content etc.) 

Do I need an iPhone to use Apple TV?

While it might make all the sense to buy an Apple TV if you’re invested in the ecosystem, you certainly don’t need an iPhone to use it. You do, however, need an iTunes account to log in and buy stuff like TV shows and movies on Apple TV.

With Apple TV you can stream stuff from popular streaming services such as Netflix, YouTube, HBO Go, Hulu Plus, Disney+ and many, many more. Of course, an active subscription is needed to access the content – Apple TV is just a platform used to display the content of your TV screen.

Works better with Apple

Although – as mentioned in the paragraph above – you don’t need an Apple device to use Apple TV, non-Apple users will lose some of the features. For example, Apple TV supports AirPlay, a feature which allows you to mirror your MacBook or iPhone screen on the TV (provided these devices are on the same Wi-Fi network).

The Apple TV line-up

Apple’s OTT offering is definitely on the more expensive side when compared to the competition:

  • Apple TV 4K, 64GB: $199.00 
  • Apple TV 4K, 32GB: $179.00 
  • Apple TV HD: $149 

The 4K model supports 4K Ultra HD and HDR video, while the HD only supports 1080p HD. The ‌Apple TV ‌4K box comes with a gigabit ethernet port which offers faster speeds over the ‌Apple TV‌ HD’s 10/100 ethernet port.

While processing power is not necessarily the key concern in OTT boxes, the second-generation ‌Apple TV‌ 4K features the A12 Bionic chip, which is significantly more powerful than the dated 1.5 GHz dual-core A8 chip first introduced with the ‌iPhone‌ 6 and ‌iPhone‌ 6 Plus in 2014. 

The benefit? Faster launch speeds, and a more responsive interface overall. Also, with future updates to tvOS, the A12 in the new-gen Apple TV 4K is more future-proof, ensuring great performance for years.

The Siri‌ Remote

With the second-generation ‌Apple TV‌ 4K, Apple introduced the redesigned ‌Siri‌ Remote. It is also included with both of the current ‌Apple TV‌ 4K and ‌Apple TV‌ HD models. 

Apple Siri Remote

Apple Siri Remote (source: Apple)

The new ‌Siri‌ Remote features a clickpad control for five-way navigation. It is also touch-enabled for fast directional swipes and better accuracy. The ‌Siri‌ button is now located on the side of the remote for convenience.

So, what is Apple TV good for anyway?

Unfortunately, Apple doesn’t list all supported apps on their website – if you’re wondering if an app is available on Apple TV, it’s best to Google the answer for yourself. Here’s the gist of the types of content you can access:

  • Streaming video. Apple TV is built to primarily stream their proprietary content, but the device also supports apps of the leading streaming content providers like: Netflix, YouTube, Amazon Video, Hulu, HBO GO/HBO NOW, etc.
  • Streaming audio. From Apple Music to services such as Pandora and Sirius XM, Apple TV supports music streaming. However, to access Spotify, you’ll need to use the AirPlay feature.
  • Games. Download games from the App Store and play them directly on your TV screen.
  • Other apps. Like with games, the App Store has a bunch of other types of apps: social media, photo sharing, media server, shopping, weather.
  • Apple AirPlay. With AirPlay out of the box, you can mirror your phone or tablet screen on your TV – but the feature only works with Apple devices. 

 

Summary

The growing popularity of Smart TV’s pushes more people to enjoy various activities on the large screen and opens a whole list of opportunities for mobile entrepreneurs.

As tvOS and the Apple TV become more popular, a growing number of content providers will start exploring new ways to take advantage of what the medium has to offer. And it will present challenges: monetization models, app discovery, and customizations will be things that brands should consider in their long term strategy should they choose to enter into the platform. 

If you’re looking to develop for Apple TV, it’s best to find a trusted OTT development partner. Drop us a line, tell us about your project and see what we can do for you!

As the Apple TV matures and adds more features and functionality, we will see new use cases and experiences emerge, driven by the early adopters who are quick to capitalize on the new opportunities the platform opens up.


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