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Apple won't sell TVs alongside iTV set-top box - analyst

While Apple Computer is expected incorporate some additional flat screen displays into its retail store layouts in order to promote its iTV set-top media box beginning early next year, the company is not developing a line of its own TVs to coincide with the product, according to one Wall Street analyst.

In a report released on Thursday, PiperJaffray analyst Gene Munster said the Cupertino, Calif.-based Mac maker plans to leverage its retail stores as 'launch pads' for the new iTV, using a few LCD TVs to demonstrate the features of the device. However, the analyst told clients he does not believe Apple will "sell 3rd party televisions, nor will the company develop Apple-branded TVs to sell in the retail stores."

Munster estimates that about 60 percent of the square footage at the company's stores represents Macs with the remaining 40 percent geared towards iPod products. "The iTV will draw slightly from each, but over the long haul we believe Apple will continue the focus on Macs at the stores," he said.

Because iTV does not fit neatly into the Apple's Mac or the iPod+iTunes sales segment, Munster sees the device as the start of third product category called "the digital living room," which he believes will bridge the gap between the company's two main growth engines.

"The iTV lets users access iTunes content stored on a computer and view it on a television. Whereas the iPod gives portable access to the same content, the iTV brings the content into the digital living room," the analyst told clients. "Therefore, the iTV provides further integration between the Mac and iPod sales segments, by adding a 3rd significant growth driver to the mix."

Meanwhile, Munster sees a release of an iPhone in the next 6 months adding a fourth product sales driver, as part of Apple's continued goal of creating new ways in which media content stored on a computer is accessible to users "anywhere at any time."

Rumors of an Apple-branded plasma TV line ran rife in the days and weeks leading up to this January's Macworld Expo in San Francisco and were recently revitalized in a Mac-based Internet radio broadcast. However, little if any evidence has ever surfaced to add credibility to the rumors.