Will Apple Douse Fire TV?
Amazon is going all out with its new set-top box. The company recently announced the release of Fire TV with big fanfare, including an ad starring actor Gary Busey that was shown during the NCAA men's college basketball championship game.
Will the device move the needle for Amazon? Should investors of fellow tech giants Apple and Google be concerned?
The success of Fire TV may lie in how much Amazon has learned from its foray into the tablet market. The Kindle was primarily an e-reader at first, but has evolved into an all-purpose device intended to drive users to access Amazon content.
But, Amazon has lagged behind other manufacturers in shipments. The iPad has outsold the Kindle by a factor of 7:1.
The real measure of success in content sharing might be how much Web traffic is generated by a device. Apple leads in that category, too. The iPad had a 78% share in 2013. The Kindle finished near the bottom of the list with 7%.
Amazon now wants to provide consumers another way to access its content, this time from the living room, and has included a few features in Fire TV that will make it easy for users to do just that. The voice-activated control seems like a nice feature, but it can only be used with Amazon applications, so it won't be a big seller with Apple or Netflix fans. The device has a beefy processing system that will allow super-fast access to programming and content. Amazon offers an optional game interface, too.
Conversely, Apple TV users have to use a cumbersome remote or go through a Siri-enabled iPhone or iPad to access applications, which don't include Amazon offerings.
Apple TV doesn't contribute much to the company's revenue. But, CEO Tim Cook recently eluded that TV will become even more important to the company going forward. There are indications that Apple is in talks with Comcast regarding a video streaming service that will send business Apple's way. Comcast and technology analysts have also reported that Apple would develop a more formable set-top box or TV. If that happens, it could be a win for Apple investors.
Google's TV offering is the Chromecast, a small device that plugs in directly into a TV and wirelessly interfaces with a computer, smartphone, or tablet. It is priced as low as $35. Both Fire TV and Apple TV will set you back $99. But, based upon available data, Chromecast is not a big seller and it isn't contributing significantly to the company's success.
Google may have to find ways to squeeze more cash out of its main cow, Seach, or work hard to ensure one of its other products, such as Google Glass or the driverless car, pays off.
Speaking of payoffs, Google doesn't seem to be getting it from hardware. The company had to divest its money-losing smartphone business, and the recent purchase of Nest, a maker of smart-home products, has come across a potential safety issue. Nest recently suspended sales of its smoke and CO detectors until the problem is fixed. This has not been a good start, to say the least.
Foolish bottom line
Fire TV, intended to route more traffic to Amazon, probably won't be a blockbuster itself, but it has the potential to attract new users to the company's digital content. It will help contribute somewhat to Amazon's current growth path, but won't change it radically.
Apple has plans in the TV arena, trying to attract more entertainment dollars by partnering with Comcast. This could limit the upside of Fire TV if the experience in the tablet market, where iPad is king, is any guide.
Google seems lost in the TV space. Its product is not a big seller, and the company has had problems with hardware, too. It is probably best that Google focus on growing Search and trying to score with one of its other efforts.
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The article Will Apple Douse Fire TV? originally appeared on Fool.com.Mark Morelli owns shares of Apple. The Motley Fool recommends Amazon.com, Apple, and Google (C shares). The Motley Fool owns shares of Amazon.com, Apple, and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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