The rumors about Apple (NASDAQ:AAPL) developing a full-fledged television set have fallen off in intensity over the past few months, but according to one rival, the tech company would do well to enter the business.
Anthony Wood, chief executive officer of set-top box maker Roku, told Investors’ Business Daily in an interview that Apple would need to create an additional source of revenue and that television was an obvious answer. “If I were Apple, I would be looking at doing that, because they’re a huge company and need big new revenue streams to expand their sales, and TVs are a good revenue stream,” Wood said.
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According to Wood, Apple had the wherewithal to make a successful entry into what is otherwise a hypercompetitive business. “The difference compared to their existing businesses is that TVs traditionally are a low-margin business,” Wood said. “And also, the main differentiator of a TV is usually the display. So the question is: Could they somehow do such a great job on user experience that they would transition people to thinking that’s the main differentiator?”
And not only does the Roku chief not foresee such a product from Apple undercutting sales of his device, he thinks his company’s set-top box may actually receive a surprise boost. Wood said a full-fledged television set from Apple may help Roku sign up new manufacturers. “I do think if Apple were to come out with a TV, they would end up competing with the top brands like Samsung,” he said. “And as we expand our platform into working with other OEMs [original equipment manufacturers], Apple’s entrance into the market would just expand the interest of companies in working with Roku to compete with Apple.”
Wood was also optimistic about the future of Netflix (NASDAQ:NFLX), which Roku offers as a service. “We see Netflix usage continuing to grow,” Wood said. “If you believe, like I do, that the future of all TV is going to be streaming over the Internet, then companies like Roku and Netflix have many years of good growth ahead of them.”
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