Television today features very large high quality displays that get into 4K HDR capability; remarkably inexpensive, and with more ways to view video than ever; cable TV, antenna, Apple TV, AirPlay, various and sundry connected devices from Google, Amazon, Roku, and others.
Why is it that so-called smart televisions are less expensive for similar hardware than stupid televisions? It’s simple. Smart TVs have applications and what you watch and when gets tracked. Stupid TVs are, well, just that. Stupid.
How does all that tracking work? Whatever the TV screen shows can be tracked. If you opt in. Vizio CTO Bill Baxter:
If the user has gone through the setup process and opted in to content recognition, then we will enable that for certain use cases, because there are restrictions, and we don’t want to violate the customer’s privacy rights and we certainly anonymize that data and we don’t try to, in any way, infringe on their privacy.
Not every television manufacturer does that, of course, and most are worse than Vizio. Samsung, I’m looking at you. Google and Amazon, too.
Apple TV is a different animal because it offers a variety of TV shows, movies, networks, applications, games, and takes feeds from devices using AirPlay.
Does Apple monetize data collected from Apple TV? The company says no. That’s not the case with Vizio, Samsung, and other smart TV makers.
It’s about post-purchase monetization of the TV. This is a cutthroat industry. It’s a 6-percent margin industry, right? I mean, you know it’s pretty ruthless. You could say it’s self-inflicted, or you could say there’s a greater strategy going on here, and there is. The greater strategy is I really don’t need to make money off of the TV.
Someone is making money from the information they collect from what you watch.
Certainly Apple uses some of that collected data to help it better understand what customers and users want, need, and view, but it’s a different ballgame with Vizio, Samsung, Google, and others who live from the proceeds of such data collection.
Apple TV is a smarter device but television viewers remain mostly in the dark as to what happens to collected data on each TV and connected device.
What if more TV viewers opt out from data collection?
What it would do is, we’d collect a little bit more margin at retail to offset it. Again, it may be an aspirational goal to not have high margins on our TV business because I can make it up downstream. On the other hand, I’m actually aggregating that monetization across a large number of users, some of which opt out.
I like Apple’s business model better than anything from Samsung, Vizio, Google, Amazon, Facebook, Netflix and friends.
Apple could be more forthcoming about what personal data is collected and how it compares with the list above.