Why Apple’s iTV Needs FaceTime

While there’s excitement over the supposed 99-cent TV show rentals on the new iTV, my belief is that won’t be enough to make iTV a success. As I write in my weekly analysis over at GigaOM Pro, there are a few other important things Apple needs to do to make this device more than just its hobby.

Besides the need for creative price bundles for shows and TV-optimized apps, Apple iTV needs FaceTime.

Those who follow GigaOM Pro know we consider video communication a big opportunity. In fact, we forecast the market will go from practically nothing today (less than half-a-million TV-based video calls in 2010) to 2.7 billion TV-based video calls in 2015.

Ok, it’s big, but why should Apple be involved in this market? It’s quite simple, really:

  • First off, it neutralizes Google and Skype. Google will most certainly push video chat into Google TV, and Skype is already pushing hard into this market. As we’ve written over at GigaOM Pro, Skype’s SkypeKit platform is Skype’s attempt to introduce its VoIP and video communication, as well as potentially other services and applications, onto CE platforms.
  • Second, it brings in a whole new demographic. While my mom and dad haven’t purchased an Apple product since the Apple IIe of my youth, I’m pretty sure they would consider a good, low-cost video-chat device like an iTV. Why? ¬†They can’t get enough of talking to my kids on Skype video, and I am sure that there are millions of others like them who would embrace high-quality video chat on TV.
  • It’s a differentiator from the cable company. Sure, Apple didn’t get all-you-can-eat $30 video subscriptions, but video chat done right could be hugely popular, and given how slow traditional cable providers move, Apple can establish themselves with a very addictive service while Big Cable spins its wheels.

I’m not entirely sure Apple will introduce Facetime next week at their big event, but they should. No one has been able to do video chat in the living room right just yet and, at least for the next six months, it’s Apple’s market for the taking.

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Image Source: flickr user james.thompson