Gene Munster Admits Defeat On Apple TV

In a report published Tuesday, Piper Jaffray analyst Gene Munster discussed various media reports that suggested Apple Inc. (NASDAQ: AAPL) has shelved a program to make a television.

"Given how adamant we have been about the reality of an Apple television, it's hard to accept the reality of no Apple television," Munster wrote. "Our latest thinking prior to this story was that Apple would launch a television in 2016."

Munster admitted he has been expecting an Apple television for the better part of the last decade. He said content was the reason for an ongoing delay in the television, however the true reason for the delay was a lack of "perceived killer features." In fact, the analyst previously believed that a combination of Siri, FaceTime, a TV app store and PrimeSense based motion control could prove to be "compelling enough" as a unique feature set for the device.

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Munster said Apple still plans on maintaining a presence in the living room and will continue to develop its set-top box that hasn't been "meaningfully" updated since early 2012. The analyst is expecting Apple to possibly preview some software or content around the Apple TV at WWDC on June 8 and ultimately launch a new device in months to follow. A new and updated device could incorporate Siri, HomeKit and possibly an Apple TV app store.

In addition, Apple may be working on early virtual and augmented reality products for the living room, although new product launches in this domain are at least five years away.

Bottom line, Munster stated that expectations for a TV were "low" while Street estimates did not reflect a television. As such, the analyst argued that there will be "no sustained impact" to shares of Apple.

Shares remain Overweight rated with an unchanged $162 price target.