The move makes the set-top box cheaper than its closest rival, Amazon's (NASDAQ:AMZN) Fire TV, which the company sells for $99 and the Roku 3 which is being sold on Amazon for $76.99. Apple cutting the price so severely is almost certainly in response to Amazon's aggressive moves into the streaming box space which also includes the $39 Fire TV Stick.
Apple's new price makes it the cheapest full-size, full-function streaming box with a cost that's low enough where it might lure people away from the cheaper "stick" offerings from Amazon, Roku, and Google. Price however is not the only deciding factor when it comes to set-top boxes so it's worth comparing Apple's offering to Amazon's top-of-the-line Fire TV.
How do the devices compare?
Both Fire TV (which I purchased) and Apple TV (which The Fool sent me for review purposes) are elegant little boxes with Apple's device having slightly more visual appeal due to its rounded edges as opposed to Amazon's plain box look. Aside from that slight distinction, both devices are pretty similar. Each comes with a power cord and both require the user to supply an HDMI cable in order to hook up to a television or monitor.
Each company also packages its set-top box with a remote. Amazon's has more buttons, but Apple's accomplishes the same things with a familiar feeling, multi-purpose menu wheel. There is one key difference in that Fire TV has a button which allows for voice commands -- a useful feature which Apple TV lacks completely.
As for apps, both companies offer a similar selection including Netflix and Hulu, among other major players that you'd expect. Amazon has the advantage of being able to offer its Prime Instant Video service to its Prime members. While both offer HBO Go, Apple will initially be the exclusive home for people who want HBO without a traditional cable subscription. That deal is only for three months from the April launch of the HBO Now service and it seems likely Amazon will ultimately get that app too.
Fire TV also has a deal with DISH Network's Sling TV which allows it to integrate that service's live TV content. Apple does not offer that, though CNET and others have reported that the company is working on its own Sling-like service.
Amazon definitely offers more apps as it's possible to search for apps on the device and download them. Apple has a closed system where new apps are offered when the company updates the device, but users cannot manually add any. They can however use Airplay to stream apps from an iPhone or iPad. Fire TV also has a selection of games and an optional joystick while Apple offers no such thing.
What are they like to use?
Amazon does an amazing job for its Prime customers by having their Fire TV boxes pre-configured right out of the box. That makes setup little more than just plugging the box in. There is a reasonably helpful video tutorial included as well, but the device is intuitive enough that it's not really needed.
Apple TV was not pre-configured to my Apple ID but that hardly mattered because Apple asks for that info the first time you attempt to access iTunes or any Apple apps. After that, if you allow it to, the app remembers your login and never asks again.
Both services are very easy to use, but Amazon has a slight edge in that its voice search can be very handy. If, for example, you say "George Clooney," it will show you all paid, free, and owned content available starring the actor.
Which should you buy?
While both are top-notch, easy-to-use set-top boxes, Fire TV simply does more. If you're really just looking for a clean way to stream the top apps to a TV then Apple TV is a fine choice -- especially at the new, lower price.
Otherwise, Amazon's device has more apps, games, free video for Prime members, and better search. Both devices are good looking and small as well as intuitive and easy to use. Amazon simply offers more experiences with Fire TV. The games alone are an important differentiator and could replace a console for families with young kids or those more into tablet-style gaming than blockbuster titles.
Apple has sweetened the deal by lowering the price for Apple TV, but it's not enough to make it a good value over the more robust Fire TV.
Daniel Kline owns shares of Apple. The Motley Fool recommends Amazon.com, Apple, Google (A shares), Google (C shares), and Netflix. The Motley Fool owns shares of Amazon.com, Apple, Google (A shares), Google (C shares), and Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.