On Sept. 1st, most of the tech world was waiting for a moment that would change everything. Even before Steve Jobs unveiled the newest version of Apple TV, there was rampant speculation that it might include the ability to purchase apps for your TV. It didn't. Why would apps have changed everything? Why didn't Jobs include them? And now that Apple has dropped the ball, who is positioned to pick it up? The logical successor is Google, with their new Google TV peripheral. But why is no one talking about Microsoft?
Arguably, the most exciting possible feature of the new Apple TV was the inclusion of apps. It seemed like the perfect combination. A device that would not only allow you to stream movies and TV shows from iTunes, but would also allow you to buy apps from the app store. Sure, you could install a weather app or a few games, but it really gets interesting when you think about TV and movie apps. Install the Netflix app, and suddenly you have streaming movies. Install Hulu, and you have first run and classic TV shows. But what happens when TV stations start creating apps that will stream entire channels to your TV? The CBS app, NBC app, ABC, FOX, HBO, The Food Network! Viewers would finally have the ability to only purchase the channels they wanted to purchase. And without a cable company as the middle man. Now take this a step further, as Twit.tv's Leo Laporte postulated. What happens when Universal Studios puts out an app? And Warner Bros? Now you have movies distributed directly to your TV without the networks as the middleman. Suddenly, it's a whole new ball game.
With such exciting world-changing possibilities, seemingly within Apple's grasp, why would they choose not to exercise them? Is it possible that Apple can make more money with their existing rental model? Regardless, the world didn't change, and Apple doesn't seem eager to shake things up. So who will? Google will release their set-top box called Google TV in time for the 2010 holiday season. They've announced that it will include apps, but no one knows to what extent. Is there a third player that may be positioned to run with the idea?
Microsoft already has the Xbox 360 installed on roughly 30 million TV sets around the world. They don't have apps or an app store, but they will very soon with the release of the first Windows Phone 7 in October. And they already have a mechanism in place for independent third parties to create and sell games on the Xbox 360. How much would it really take to incorporate apps into this system? Suddenly, the company that's arriving late to the phone party could beat everyone at their own game. In one move, they could achieve a huge head start in the set-top box market, while using that lead to bolster phone sales. Maybe they create an app that lets people on Windows Phone 7 video chat with people on an Xbox. Or maybe if you buy the HBO app on the Xbox, you get it free on the phone. I'll leave the other ideas up to them.
Now I don't think Microsoft can capture the hearts and wallets of the general public overnight. For one thing, Microsoft needs to train people to think of the Xbox as not simply a gaming system, but a home entertainment device. I don't think they can do that with the present device. But it's not too soon to grab those hard-core gamers.






