GFK data shows that Apple TV has been losing share among
streaming-audio/video devices and that the biggest seller at retail stores is
Google Chromecast.

Earlier this week Apple chose to not pass on to Australians
the $40 price cut being offered to US consumers with insiders now claiming that
the exercise is more about clearing out stock in the US in preparation for a
brand new Apple device that delivers streamed music and movies, some insiders
even tipping a new Apple Beats content service for both video and music in
July. 

IHS Technology said that the selection of streaming-video
devices at A$109 and less has grown increasingly crowded, slowing Apple TV’s
growth rate, said senior analyst Paul Erickson.

To compete better, Apple will have to expand Apple TV’s
overall capabilities, continue expanding the selection of marquee content
partners, release updated hardware, or executive a combination of these
options, he said.

 Another problem for
Apple TV is its ability to use only iOS mobile devices as controllers and
stream audio and video only from Apple devices, IHS said.

Google’s $25 Chromecast HDMI stick, on the other hand,
offers multi-platform compatibility as well as a much lower price point, IHS
said. As a result, for the near future, Google Chromecast shipments will
continue to exceed those of Apple TV by a close margin, said IHS.

The company estimates that 8.7 million Chromecasts shipped
in 2014, outselling Apple TV’s 8.3 million units.

 Only a few years ago,
Apple TV was number one in a market in which only Roku was a true competitor,
the company said.

Today, the market is filled with competing devices,
including Chromecast at $49, sub-$50 full-featured HDMI sticks from Amazon and
Roku, and a range of more powerful streaming boxes from several manufacturers
including Google, and Amazon, and several niche competitors, IHS said

Growing support among app developers for Google Cast for
both iOS and Android apps “has the potential to open the market up even more
strongly in favour of Chromecast,” IHS added. Built-in Google Cast support in
Android-based smart TVs arriving this year from Sony, Sharp, and Philips “will
also chip away at the need to purchase Apple TV within iOS households
purchasing new smart TVs from these brands,” IHS continued.

To beat back the Google threat, Apple also needs more
powerful hardware, IHS said. Apple TV’s dual-core ARM-based A5 processor,
PowerVR GPU, and 802.11n wireless capability “have thus far been sufficient to
handle the 1080p video streaming and AirPlay duties that the device is
primarily used for,” the company said. But the device “is due for a likely
hardware revision this year given age, increasing iOS complexity, and evolving
market needs.”