Each week, there are dozens of Apple rumors, reports, and patent filings that hint at what’s coming out of Cupertino next. Some are legit, but most are totally bogus. We’ve parsed the week’s rumors, ranking them in order from “utterly ridiculous” to “duh, of course.” First up…
ASK AGAIN LATER: Apple Inventing Solar Charging Accessory Apple’s been dabbling in the solar power game for a while — at least according to its intellectual property filings. The company’s latest invention to come out of the U.S. Patent and Trademark Office is a solar panel accessory that doesn’t need a power converter and would work with a MacBook, iPhone, iPad, or iPod touch via USB or a power connector. They key part of the patent is the power management circuitry, which could be embedded in the device itself. Could we start seeing partially solar powered devices or accessories from Apple in the not too distant future? It’s definitely possible.
ASK AGAIN LATER: Retina iPad Mini Could Launch November 21 Target.com let slip in a product listing that the iPad mini with Retina display would be released November 21, a week before Thanksgiving. This particular release date is interesting — Apple usually releases products on a Friday (like the iPad Air, which just went on sale today). However, with holiday travel, Black Friday, and all that jazz, it could make sense for Apple to give iPad mini admirers some extra time before the weekend officially lands to get their hands on the new tablet. Or maybe the 21st isn’t the real date after all.
SIGNS POINT TO YES: Job Listing Indicates Apple Working on Maps’ Transit Directions It’s about time: Two job listing seem to show that Apple is working on adding transit directions to Apple Maps. The positions are “Maps Public Transit Engineering Manager” and “Public Transit Software Engineer,” and both would (logically) work on the Maps team to improve its “Transit Routing” platform. If it wants to be competitive with mapping app leaders like Google, transit directions are a must. It makes complete sense that Apple would want to beef up its team on this front.
WITHOUT A DOUBT: Apple Experimenting With Curved Glass Wrist-Worn Devices According to The New York Times, Apple is exploring a wristwatch-like device made of curved glass. Between the company’s recent wearables-related hires, other whispers from employees and suppliers, and CEO Tim Cook’s frequent teases, it’s almost a given that Apple is working on some sort of wearable device. Apple has also patented a means for bending glass, providing evidence the company is taking some time to explore the curved glass space. (Corning has been working on curved Gorilla Glass for a while now too). As for when we’ll see these devices and what they’ll look like, that’s still anyone’s guess
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Although Netflix remains committed to offering HBO titles to its rent-by-mail customers — the company can simply acquire the latest releases of Boardwalk Empire and True Blood via other retail outlets — this move underscores a trend we’ve written about before: The content battle taking place between online streaming and TV Everywhere, the initiative from content providers to offer their products directly to subscribers online.
Brad Adgate, senior vice president and director of research at Horizon Media doesn’t think HBO’s decision to refuse discounts on its discs will have much of an impact on Netflix’s subscriber base, in part because “DVDs are kind of on its way out and Netflix has moved its core business to streaming.” He describes the relationship between HBO and Netflix as “frienemies,” noting that “they are competitors but also offer the other a source of revenue.”
According to Adgate, the real challenge is the success of HBO’s streaming app, HBO Go, and the broader impact that might have on Netflix’s new core business.
HBO Go vs. Netflix
HBO’s parent company, Time Warner, has famously refused to license its popular and critically acclaimed content to Netflix (excepting early HBO programming like The Larry Sanders Show that are bound under different home-video agreements). Instead, HBO has pursued its own TV Everywhere initiative with HBO Go.
HBO Go is an app that offers subscribers access to current HBO programming along with a back catalog of original series. This content is available on iOS, Android, Roku and video game consoles. HBO Go is a huge hit, with more than 5 million downloads in 2011. Time Warner Cable and Cablevision, two early TV Everywhere holdouts, have both agreed to start support HBO Go in 2012.
As I’ve argued in the past, the success of HBO Go has shown content owners that they don’t necessarily have to bypass traditional distribution platforms like cable; instead content owners can augment their current cable deals with online/tablet/phone access.
The Content Battle Continues
When it comes to content, Netflix is in a bit of a catch 22. On the one hand, it needs a viable, robust and ever-increasing library of streaming content to keep its customer base. On the other hand, the success of Netflix — and indeed the broader success of Hulu Plus, HBO Go and online subscription in general — has made acquiring content much more expensive.
As Adgate pointed out, Netflix’s deal with Starz expires next month. When the Starz agreement ends, Netflix will lose its streaming access to almost all of its Walt Disney, Pixar and Sony Pictures content. Netflix has tried to spin the loss, pointing out its content deals with AMC Networks and DreamWorks Animation, but as Adgate pointed out, the company is now paying the same amount for a small selection of titles that it used to pay for an entire year’s worth of Starz content.
Adgate thinks Netflix’s next step will be to sell advertising “similar to the way Hulu does and what YouTube is trying to do” and in the process “create a second revenue stream” in addition to subscriber fees. Adgate argues that while many compare Netflix to ad-free pay cable à la HBO, the better comparison is traditional cable networks like FX or ESPN. As Adgate notes, “Consumers already pay $5 a month for ESPN and you get ads with that.”
It’s an interesting proposition. While Netflix might have a hard time integrating advertising into its main catalog of titles, the company is increasingly investing in original programming. Its first original series will debut next month, with future projects — including the continuation of Arrested Development to follow into 2013.
Viewers Still Love Netflix
Of course, even with the content growing pains, viewers still love Netflix. The company reported 2 billion hours of streaming content was consumed at the end of 2011. Analyst Richard Greenfield told Variety that by his estimations, that would make Netflix the 15th most watched network.
The real question is, what impact will new content deals (or a lack of deals) have on these viewership numbers.
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