This presentation was developed as a team assignment for MSCI 602 course in the Management Science Department, University of Waterloo.

1. 1

2. Comparison of
User Perceived Value:
Apple TV Vs. Google TV
28th February 2012
Business Intelligence
Technology Evaluation (BITE) Team 8A:
Ahmed Ali Asad
Umer Shaheen Malik
Syed Sohail Javaad

3. Our Objective
• To perform a head-to-head comparison of
Google TV vs Apple TV with a focus on 'user-
perceived value'
• Methodology for planning, gathering and
summarizing the end-user evidence
• Analysis
3

4. Google TV
4

5. Google TV
• Available as a stand alone device and integrated with major TV brands like
SONY
• Supports up to 1080p resolution
• Wi-Fi, Ethernet, HDMI and Blu-ray player
• Picture-in-Picture (PIP)
• Wireless controller
– QWERTY based keyboard
– Android devices and IPhones
• Android based (open source) platform
• 5.1 and 7.1 audio supported to give a real surround sound experience
• Supports One Touch DVR recording
• Browser with full HTML and flash support
• Costs around USD 400
5

6. Apple TV
• Launched in March 2006; 2nd Generation introduced in 2010
• No hard drive; but cloud based storage available
• AIRPLAY and Mirroring technology
• Wi-Fi, Ethernet, HDMI port and “stylish” wireless controller
• Smaller size with iPhone as remote control
• Ad-free HD 720p movies and TV shows from iTunes
– Rental from ITunes: For an HD movie from iTunes - 4.99 USD and a TV
show 0.99 USD
• Music and Pictures can be accessed through icloud or other iOS devices
• Apps for YouTube, Vimeo, Flickr
• Apple TV does not support Flash
• Cost: USD 100
6

7. Apple TV
7

8. User Perceived Value
• “consumer’s overall assessment of the utility of a product
(or service) based on perceptions of what is received and
what is given.” (Zeithaml, V. A. 1988)
– Implies: “Quality” and “Price”
• “superior value to the buyer in terms of product quality,
special features, or after-sale service.” (Porter, M. E.
(1990))
– Implies: User perception is much more than quality and price
• A four-dimensional conceptualization of user value is
adapted from other studies (Sweeney Jillian C, S. G.
(2001); Wang Yonggui, L. H.-P. (2004); Zeithaml, V. A.
1988); and applied to internet TV
8

9. User Perceived Value: Dimensions
Functional
The utility a market offering provides through its expected
performance and perceived quality
9

10. User Perceived Value: Dimensions
Economic
The utility an offering provides in proportion to
the overall costs
10

11. User Perceived Value: Dimensions
Emotional
The utility an offering creates through feelings
or affective states
11

12. User Perceived Value: Dimensions
Social
The utility a market offering provides through
its ability to enhance the individual’s social
self-concept
12

13. Methodology
• Approach used by Sweeny and Soutar (2001)
– Focus groups for variable identification for measuring
User Perceived Value
– Survey administration
– Use of statistical techniques (Principal Component
Analysis) for identifying four dimensions for measuring
perceived value:
• Functional
• Emotional
• Economical
• Social
13

14. Our Methodology – Step 1
Variable selection:
• Used Internet Research for identifying variables
• Examined about 3000 comments from:
– Selected YouTube videos of Apple and Google TV
– Selected blogs from websites like wired.com, pcmag.com
• From these comments, identified about 40 different
aspects that the users valued
• Converted these 40 aspects into 17 variables
14

15. Variables
Var 1 Overall this product is value for my money
Var 2 The content on this product is going to be very expensive
Var 3 This device is expensive
Var 4 Superior design
Var 5 Overall content being offered is great
Var 6 Faced/likely to face technical problems
Var 7 I will buy this product because I like this company
Var 8 Portability - Seamless Integration with other home devices
Var 9 Adequate live TV programming is available
Var 10 Open source / Software portability
Var 11 Better quality and performance
Var 12 This product is more like a real TV
Var 13 This product is more like a computer; I can do anything that I want to do
Var 14 This product is easy to use
Var 15 This device has more features
Var 16 It is cool to own this product
Var 17 I want this product because this company is a leader and an innovator
15

16. Methodology – Step 2: Survey
• Questionnaire:
– Likert Scale (1-5): 1 strongly disagree and 5 strongly
agree
– Respondents were asked:
• To rate their preferences for Apple TV and Google TV
• To identify their intent of purchase
– Apple TV, Google TV or Other Product
– No personal information was collected
16

17. Methodology – Step 2: Survey
• Survey Administration:
– In store: selected randomly across Ontario
– Respondents who showed their interest in either
Apple TV or Google TV were approached before they
left
– 200 responses were gathered
17

18. Methodology – Step 3: Analysis
• Data Analysis
– Basic Statistics
– Principal Component Analysis (PCA) to identify
underlying factors
• PCA is a an statistical technique that identifies underlying
dimensions based on correlations within variables
• First PCA was done using SPSS software to identify and
verify dimensions related to user perceived value;
separately for Google and Apple TV
• Then PCA was performed on combined responses to
identify product-related trends
18

19. Results: Basic Statistics for Apple TV
I want this product because this company is a leader and an innovator
It is cool to own this product
This device has more features
This product is easy to use
This product is more like a computer; I can do anything that I want to do
This product is more like a real TV
Better quality and performance
Open source / Software portability
Live TV programming is available
Portability - Seamless Integration with other home devices
I will buy this product because I like this company
Faced/likely to face technical problems
Overall content being offered is great
Superior design
This device is expensive
The content on this product is going to be very expensive
Overall this product is value for my money
0 5 10 15 20 25 30 35 40 45
Strongly Agree Agree Neutral Disagree Strongly Disagree
19

20. Results: Basic Statistics for Google TV
I want this product because this company is a leader and an innovator
It is cool to own this product
This device has more features
This product is easy to use
This product is more like a computer; I can do anything that I want to do
This product is more like a real TV
Better quality and performance
Open source / Software portability
Live TV programming is available
Portability - Seamless Integration with other home devices
I will buy this product because I like this company
Faced/likely to face technical problems
Overall content being offered is great
Superior design
This device is expensive
The content on this product is going to be very expensive
Overall this product is value for my money
10 20 30 40 50 60
Strongly Agree Agree Neutral Disagree Strongly Disagree
20

21. Results: Intent to Purchase
Apple TV Other
29% 16%
Will not buy
any thing
15%
Google TV
40%
Almost 16% said that they will buy other devices like Xbox, Wii, PS, Boxee
etc
21

22. Results: PCA for Apple TV
Total Variance Explained
Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
Component % of Cumulative
Total Variance % Total % of Variance Cumulative % Total % of Variance Cumulative %
1 3.694 23.089 23.089 3.694 23.089 23.089 3.566 22.288 22.288
2 2.590 16.188 39.277 2.590 16.188 39.277 2.641 16.504 38.791
3 1.868 11.673 50.950 1.868 11.673 50.950 1.814 11.335 50.127
4 1.795 11.216 62.166 1.795 11.216 62.166 1.730 10.814 60.941
5 1.378 8.610 70.776 1.378 8.610 70.776 1.574 9.835 70.776
6 .800 5.000 75.776
7 .721 4.507 80.283
8 .565 3.529 83.812
9 .548 3.422 87.234
10 .495 3.096 90.330
11 .376 2.349 92.678
12 .342 2.136 94.814
13 .256 1.599 96.413
14 .234 1.462 97.875
15 .212 1.325 99.200
16 .128 .800 100.000
Extraction Method: Principal Component Analysis.
22

23. Results: PCA for Apple TV
Variance
Variable Component Explained
Overall this product is value for my money
The content on this product is going to be very expensive Economic 11.6%
This device is expensive
Superior design
Overall content being offered is great
Emotional 16%
Faced/likely to face technical problems
I will buy this product because I like this company
Portability - Seamless Integration with other home devices
Adequate live TV programming is available
Open source / Software portability Functional 23%
Better quality and performance
This product is more like a computer; I can do anything that I want to do
This product is more like a real TV
Personal 11.2%
This product is easy to use
It is cool to own this product
Social 8.6%
I want this product because this company is a leader and an innovator
23

24. Perception: Apple TV
• Functionality is most important
• Has an emotional attachment with apple
• Attaches equal importance to personal and
economic reasons
• Economic reasons are at a lower level
24

25. Results: PCA for Google TV
Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
Component Total % of Variance Cumulative % Total % of Variance Cumulative % Total % of Variance Cumulative %
1 5.605 32.971 32.971 5.605 32.971 32.971 5.505 32.383 32.383
2 2.796 16.450 49.420 2.796 16.450 49.420 2.748 16.165 48.548
3 2.248 13.221 62.642 2.248 13.221 62.642 2.380 14.000 62.548
4 1.576 9.269 71.911 1.576 9.269 71.911 1.592 9.363 71.911
5 .859 5.055 76.966
6 .713 4.197 81.163
7 .593 3.488 84.651
8 .566 3.329 87.980
9 .425 2.502 90.482
10 .404 2.375 92.857
11 .336 1.979 94.837
12 .270 1.591 96.428
13 .186 1.091 97.519
14 .156 .918 98.437
15 .121 .710 99.147
16 .078 .460 99.607
17 .067 .393 100.000
Extraction Method: Principal Component Analysis.
25

26. Results: PCA for Google TV
Variable Component Variance
Explained
Overall this product is value for my money
The content on this product is going to be very expensive Economic 14%
This device is expensive
Superior design
Overall content being offered is great
Emotional 16.2%
Faced/likely to face technical problems
I will buy this product because I like this company
Portability - Seamless Integration with other home devices
Adequate live TV programming is available
Open source / Software portability
Better quality and performance
Functional 33%
This product is more like a real TV
This product is more like a computer; I can do anything that I want to do
This product is easy to use
This device has more features
It is cool to own this product
Social 9.4%
I want this product because this company is a leader and an innovator
26

27. Perception: Google TV
• Functionality is most important
• Showed an emotional attachment with Google
• Attached more importance to economic reasons
as compared to Apple users
• Social reasons are at a lower level
27

28. Results: Comparison*
Google TV Apple TV
Variable Disagree Neutral Agree Disagree Neutral Agree
Overall this product is value for my money 65 34 - 5 31 64
Economic The content on this product is going to be very expensive 64 35 - 4 35 62
This device is expensive 7 32 60 78 18 5
Superior design 69 30 - - 35 66
Overall content being offered is great - 18 82 34 33 34
Emotional
Faced/likely to face technical problems 16 36 47 70 30 -
I will buy this product because I like this company 38 33 28 - 13 87
Portability - Seamless Integration with other home devices 100 - - - 39 62
Live TV programming is available - 47 53 63 38 -
Open source / Software portability - - 100 82 18 -
Better quality and performance 48 40 11 - 36 64
Functional This product is more like a real TV 78 21 - 12 15 74
This product is more like a computer; I can do anything that I want to do - 39 60 77 23 -
This product is easy to use - 38 62 6 45 50
This device has more features - 33 67 43 26 32
It is cool to own this product 31 39 29 - 28 72
Social I want this product because this company is a leader and an
68 32 - - 14 87
innovator
*1-5 scale transformed to 1-3 scale for better comparison; comparison based on
Principal Component Analysis of combined cases 28

29. Perception about Apple TV
• Functionality is most important:
– Quality and performance of Apple TV is better
– It integrates well with other (Apple) home devices (probably Airplay)
– While the device has less features, it is more closer to TV and is easier to
use
– Adequate live programming is not available
• Has an emotional attachment with apple
• Apple TV has superior design and they are less likely to face technical problems
• And they will buy this product because they like Apple brand!
• Economic reasons are at a lower level but think that:
– Apple TV is value for money!
– While the device is not expensive the content is!
• It is socially cool to own this device
• Want Apple TV because the company is a leader and innovator!
29

30. Perception about Google TV
• Functionality is most important
– The device is like a computer with more features
– It is easier to use
– Software is open source and more live TV content can be accessed (probably
because of HTML and Flash)
– But the device may not be superior in quality and performance
– The device is not portable with other home entertainment devices
• Showed an emotional attachment with Google
– Content is better than Apple…
– …but design is not great and they are more likely to face technical issues
– Brand “Google” is less likely to play a significant role in purchase decision
• Attached more importance to economic reasons as compared to Apple users
– More people thought that the device is very expensive but the content is not!!
– However, two-third think that the device is not value for money (and one third
remained neutral)
• Social reasons are at a lower level
30

31. Apple TV Vs Google TV
• Apple is a stronger “brand” than Google
• Apple TV is more likely to perform better than
Google TV
• Apple TV is more like a TV but Google is more like
a computer (strategic intent!!)
• The cost of content (software, movies, TV shows
etc) on Apple TV is more than Google TV
(probably Google will be free!!)
31

32. What Google is doing?
• Released Improved version 2.01
• Updating its TV Software2
• Will shortly release its new app for You Tube3
• Partnering with more TV manufaturers4
• There are even “rumors” that Google is introducing
new hardware changes (Tungsten) that would serve
as a hub for integrating all Android devices5
1. http://techcrunch.com/2011/11/03/google-tv-v2-review-its-getting-closer/
2. http://www.bloomberg.com/news/2012-01-12/google-readies-next-version-
of-tv-software-for-2012-release.html
3. http://googletv.blogspot.com/
4. http://www.forbes.com/sites/elizabethwoyke/2012/01/10/lg-on-google-tv-
beating-samsung-and-sales-targets-for-oled-tv/
5. http://www.pcmag.com/article2/0,2817,2400159,00.asp 32

33. Recommendation – 1:
• Steps in the right direction
• But Google need to spread the word better!!
• Improve availability of in-store device
information
• Improve brand image
• Reduce cost and improve perceived economic
value!!
33

34. Recommendation – 2:
• TV live (and time-recorded) content will be the
most important factor in the war of IP-TVs
• because…
34

35. Market Analysis: TV Viewing US
Source: http://www.slideshare.net/genarobardy/nielsen-crossplatform-report-q1-2011
35

36. Market Analysis: US
Source: http://www.slideshare.net/genarobardy/nielsen-crossplatform-report-q1-2011
36

37. A Threat and a Weakness:
• Huge opportunity for Google in TV
Market but….
• Only about 50% of the respondents think
that adequate live TV programs are
available on Google TV as compared to
Apple TV
• Worse: About ¾ of respondents think
that Apple is more like a TV as compared
to Google
37

38. Recommendation - 2
• Content is the KEY!!!1
• Google TV just can’t rely only on You Tube
• It has to enter into strategic partnerships with
(major) studios for live content including sports
• But it might not be an easy task2
• More importantly it has to use its core
competency (aka “AdSense”) and provide ad-
free content to consumers at even lesser cost
than Cable TV or (or even Apple TV)
1. http://www.pcmag.com/article2/0,2817,2364068,00.asp
2: http://www.wired.com/epicenter/2011/02/cable-google-tv-revolution/
38

39. Recommendation - 3
• Remember: Almost 15% of respondents
think that they will buy other devices
(Xbox, Wii, Play Station)
• Gaming is important too!!
• Consider strategic partnerships with
gaming companies too
• Provide Gaming hardware too but only
as an add-on option
39

40. Work Cited
Porter, M. E. (1990). The competitive advantage of nations. New York: MacMillan
Press.
Sweeney Jillian C, S. G. (2001). Consumer perceived value: The development of a
multiple item scale. Journal of Retailing, 77(2), 203-220.
Wang Yonggui, L. H.-P. (2004). An Integrated Framework for Service Quality, Customer
Value, Satisfaction: Evidence from China's Telecommunication Industry. Information
Systems Frontiers, 6(4), 325-340.
Zeithaml, V. A. (1988, July). Consumer Perceptions of Price, Quality, and Value: A
Means-End Model and Synthesis of Evidence. The Journal of Marketing, 52(3), 2-22.
40

41. That’s all from us…
Questions are Welcome!!
41