Piper Jaffray analyst Gene Munster has been predicting that Apple (Nasdaq: AAPL) would eventually roll out a connected Apple TV product for months, and he's at it again, saying in a note to investors last week that the company's revelation during its 1Q earnings call last month is a sure indication of what's percolating at Apple HQ, with or without Steve Jobs.
Apple COO Tim Cook, standing in for Jobs, who's away on an indeterminate medical leave, told analysts that the company had paid some $3.9 billion in prepayments to three companies. IHS analyst Vinita Jakhanwal speculates the three are LG (NYSE: LG), Toshiba Mobile Display and LG Display, which leads Munster to postulate that those investments are for LCD screens for its iPad, iPhone and Mac lines, and includes screen between 27 inches and 50 inches.
"While Apple's commitment to the living room remains a 'hobby', we continue to believe the company will enter the TV market with a full focus, as an all-in-one Apple television could move the needle when connected TVs proliferate," Munster said.
Munster forecast that in 2012, close to 50 percent of the 220 million flat-screen TVs expected to be sold would be connected TVs and that Apple could easily capture a piece of that market, at least 1.4 million units initially. That would add a hefty $2.5 billion to its bottom line in 2012 and grow to $6 billion in 2014.
The company has had modest success with its Apple TV product, of which it sold at least 1 million units in 2010. Netflix (Nasdaq: NFLX) has said the relatively limited sales of that Apple product still resulted in a big increase in use for its streaming videos, far outstripping streaming movies to the iPad in 2010. Netflix also predicted that connected TVs and Blu-ray players were "the big growth categories" for it in the future.
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