From PCs, Phones and Tablets to Cars and TVs?

Word is out now that Apple will not be making a TV, and may have decided to shelve the project (if it existed as anything beyond an experiment) over a year ago. The rumours continue to swirl about Apple designing a car, but don’t be surprised to find out that is also not going to happen. I was reasonably confident Apple wasn’t going to release a television. I’m pretty confident they won’t create a new car. Not all shiny objects are created equal.

A TV Is Not A PC

No matter how hard you try to make a traditional television a PC, it isn’t one. Sure, a modern TV and a PC share a lot of common technology. Both run sophisticated operating systems, both are powered by traditional CPU’s, and have memory and local storage. Like an iMac, a TV also includes a built-in screen. But what makes a TV a “television” isn’t the technology, it’s the way it the content is consumed, and how the television is viewed in the pantheon of devices in the home. The technical similarities are superficial.

First, a TV is an “appliance”, in that we buy them and use them for a very long time. I have a flatscreen TV in my house that is 13 years old, still does the job it needs to do, and won’t be replaced anytime soon. I replace my TV’s about as often as I replace refrigerators, dishwashers or microwaves. That is to say, not very often. PC’s don’t last nearly as long. Even my parents, a fairly conservative demographic known for holding on to PC’s for longer than “typical”, replace their one laptop 3-4 times before they end up replacing a major appliance, including televisions.

People use a television to display content. We have developed a traditional way of watching traditional television that hasn’t changed much in about 60 years. We still deal with channels and fixed schedules. It is limiting, and discovering new content can be a challenge. But it is also dirt simple for people to understand. In the simplest case, all I need is channel up/down and volume up/down. I can add a number pad and a simple guide navigator. It takes seconds to figure out, and one you’ve learned it, you never forget.

To get other content, what people are doing is connecting other things to their TV to make it a display for other devices. This isn’t a “television” anymore, and the physical machine isn’t the main focus (other than you look at it). The idea is to consume content differently, whether connecting to your iTunes library or some other local media server, or using streaming services like YouTube, Netflix, Shomi or Crave. This isn’t about the hardware, it’s about the content. Making an Apple “television” wasn’t going to change that conversation, and would instead trap Apple into a quagmire known as the appliance business: low margins, low turnover. The AppleTV is a better solution. A full-on television set is not.

A Car Is Not A Tablet

Which brings us to cars, the second-biggest purchase a consumer can make, and the most technologically sophisticated product most people will ever own. Consider a car: it has all the attributes of a PC or tablet (computing, phone, storage, navigation, apps) plus most of the attributes of your house (furniture, climate control, windows, doors, structure). It has to work in environmental extremes (+50 to -50, rain, snow, sleet, hail, fog, dust). It has to keep the occupants protected from that environment, as well as provide safety protection from impact with other cars travelling at high speeds. And it has to do this while safely, quietly and efficiently moving said machine down a road (sometimes of questionable quality) at speeds over 100 km/h.

The car may be the most heavily regulated piece of consumer technology you own, except for maybe your house (check out building codes sometime. It’s pretty crazy). It has to meet all the same FCC-type rules that all phones have to follow. It must conform to engineering standards set by the Society of Automotive Engineers (SAE). And it has to follow a host of rules at both the federal and provincial/state level (safety, functionality, emissions, etc). They are subject to mandatory recalls by the government at a scale few other products can see. And they have to be reviewed and even certified by outside regulatory bodies before you can even sell one. Imagine an industry where you have to supply 4-6 copies of each product just so it can be destroyed in testing, and if you don’t, you can’t sell your product.

It can take 5 years to design a new car, whether from scratch or a major redesign of an existing model. As Tesla is finding out, the status quo to sell one is mired in politics and red tape, namely in the form of the “dealership network”. In North America, the car is the one product that cannot be legally be sold directly from the manufacturer to the consumer via a physical storefront. The dealer lobby is still plenty powerful, and those rules are going to change very slowly.

If a software update breaks someone’s tablet, that is an inconvenience. If a software update makes a car dangerous, it can kill people. That right there is the starkest difference between a car and consumer electronics. Most smartphones and tablets can’t kill you if the OS has a bug. A defect in the car’s system can result in death. That’s the reason why updates and changes to car software comes out so slowly: they have to test it to an extent few other software systems see (avionics software is even harder to get out the door). The testing iOS, OS X, Windows or others see is nothing compared to the testing done on real-time systems in things like cars. And even with all that testing and process, bugs will still make it into the software.

Apple will not be selling millions of cars. Apple might, if they are lucky, sell tens of thousands of cars globally. Tesla sold just over 21,000 Model S cars globally in 2014. Consider that about 14 million new cars were bought in North America last year. There are typically 75 million new cars sold globally. Toyota is currently the largest global car manufacturer, and sold 10.2 million cars around the world. Tesla’s share amounts to 0.0003% of the global car market. It took them 2 years to get there.

Experiments Are Not Products

Companies like Apple, Boeing, GM, McDonald’s, Kraft and others experiment with stuff all the time. In the car industry, we often see those experiments as concept cars toured around each year. In the technology world, a lot of those experiments never see the light of day. But word of those experiments will leak out. It’s inevitable: the larger the group that knows a secret, the more likely the secret will be divulged. The more compelling something appears, the more likely it will be leaked.

Apple may have experimented with a television, but it really wasn’t going to come to be. It simply didn’t make sense. Apple may be experimenting with cars. That doesn’t mean they are going to spend the billions it takes to fully develop a car, create the factories and set up the dealer network. If they are trying to better understand the automotive world, then it does. So does hiring people with experience in the industry. But that helps them to build technology that could be in every car sold, not the paltry 0.0001% of the market that an Apple car might hope to capture one day, eventually.

Apple wants their products front and centre with millions of people, not thousands. A technology like CarPlay get them into millions of new cars. There is no real “commitment” needed from the consumer to get it as part of a new car purchase. The AppleTV gets them into millions of living rooms and home theatres with modest effort from the consumer. The commitment to add the AppleTV is minimal. Buying an Apple car or television? A much harder sell and a bigger commitment from the consumer. One approach scales to be potentially ubiquitous. The other approach does not.

Advertisements