Will Apple Change Television Forever?

Not now. Maybe never.

Steve Jobs introduces iTV

A month ago, I said Steve Jobs had no plans to unveil an iTV—the hypothetical iTunes video gadget for big-screen TVs. Wrong! This week His Steveness invited me to the iTV demo at Apple’s Tuesday press event in San Francisco.

What’s iTV? It’s a living-room iTunes player for movies, TV shows, music, talk radio (in podcast form), and high-res photos. It connects to big-screen TVs or home theater centers, and pulls content from a PC or Mac in another room over a wired or wireless network. You sit back on the couch with an iPod-styled remote control and thumb through menus on your television screen. Click to buy TV shows and movies from the iTunes Store or schedule downloads of future episodes and new releases. It’ll play DVDs and CDs from the computer.

Just as important is what iTV doesn’t do. It doesn’t hook up to cable TV or tune in to broadcasts. So, it won’t record events off the air for you like a TiVo does—you’ve got to hope there’s an available download in the store. It’s not clear how it will handle television coverage of live events, if at all. And so far, Jobs has managed to convince only Disney and its substudios (Miramax, Pixar, and Touchstone) to sell movies through iTunes. As the Washington Post reported last week, other Hollywood studios balked at his proposed pricing for their wares.

The most surprising thing about iTV is that it won’t be out until January. Jobs usually hauls his awesome gadgets on stage the day they go on sale, rather than promising something that’ll be awesome next year, as Intel did with its disappointing Viiv video platform earlier this year. On the way out of the Apple presentation, business reporters pondered whether he was trying to build buzz to win over major studios like Universal and Warner Bros. before the big launch.

Will iTV rock your world? Not in the form I saw on Tuesday. There’s not enough to watch on it, and what you can watch is below DVD-quality in video resolution. The iTV will allow iTunes addicts to watch Battlestar Galactica on a bigger screen, but it won’t make anyone unsubscribe from Comcast.

Not yet, anyway. As summarized by software engineer Kevin Marks, iTV’s real potential will reveal itself down the road: “Delivering TV by real-time streaming … can be completely short-circuited by downloading movies and TV over current broadband.” What he means is that instead of waiting for cable companies to build out ever-fatter networks, Hollywood studios should deliver shows over the Internet. They should serve them as downloads rather than real-time streams that look awful if they sputter for even a fraction of a second. Replacing streaming video with take-your-time downloads is exactly what iTunes does.

The biggest hurdle—and the biggest difference between iTunes music and iTunes video—is that high-definition video requires a lot of bandwidth to download, especially if everyone’s downloading a different show at the same time. That’s why for now, iTunes movies and shows are restricted to a resolution of 640 x 480 pixels, less than a movie you watch on DVD. On a 5 megabit connection, they’ll still take half an hour each to download.

How do they look? A letterboxed 640-pixel clip from Pirates of the Caribbean looked fine to me on the big screen at Tuesday’s event, but I doubt it would win a side-by-side test against HDTV at Best Buy. Unlike iTunes music downloads, you don’t need to be a connoisseur with snob-level gear to spot the difference between a download and a disc.  Normal people who’ve spent thousands on 1,920-pixel plasma displays might feel cheated stretching one-third-size videos to cover them. As Séan Captain recently explained in Slate, by the time the video quality of downloads catches up to HDTV, there’ll already be a higher-definition replacement for it. And Apple still hasn’t explained if and how they’ll deliver live sports and news.

If Hollywood studios sign up with Apple, there’ll be two different approaches to the future of mainstream TV: Higher Definition (cable and discs) versus More Titles (downloads). I wouldn’t dream of saying one is better than the other. Rather, I think they’ll coexist, just as downloaded music sales are still a fraction of the disc market owned by Wal-Mart, Best Buy, Target, and Amazon. The choice is yours. Which would you rather pay for and watch from the couch—500 channels of cable, or 500,000 downloads on iTunes?