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Ovum’s new Apple Smart Device Vendor Profile assesses Apple’s position in the smart device vendor market and offers some recommendations for Apple.

In the TV space, Apple needs to create a subscription model for content to complement its per-show purchase model and create a more compelling offering, and it also needs to create an App Store and SDK for the Apple TV to drive innovation on that platform.

It needs to evolve the UI for iOS in the short term to provide more information on the home screen, rather than burying such information in apps or the notification drawer. More importantly, it needs to start planning now to evolve the core of the platform for future applications. Lastly, it needs to replace more of the third-party services currently in use on the platform with Apple-provided services, as it will do with Maps in iOS 6.

Apple TV needs to move beyond the hobby stage

The development of television is currently in a temporary diversion from its natural course, in that content is not being viewed on the biggest screen in the home because the business models for consuming video content are more attractive on computers and mobile devices than they are on televisions. Apple is benefiting from that trend as consumers view content in iTunes or on iPhones, iPads and iPods, but the time will come when that viewing migrates back to the TV, and Apple needs to be part of that picture.

This emphatically does not mean that Apple needs to make a television, but rather that it needs to make its content offerings more fit for purpose for the living room and the largest screen in the house. This means moving away from the relatively unattractive per-show purchase model it uses at present and towards a subscription model with a flat monthly fee and access to a wide range of content. In the US and elsewhere there is a gap in the market for a subscription service that combines a large back catalog with nearly live content, and Apple could fill that role.

Beyond that, though, Apple also needs to make the Apple TV platform more attractive by moving beyond video content and towards gaming. Most consumers only make room for one input port on their television for live viewing, one port for pre-recorded viewing (DVD or Blu-Ray today) and possibly one for a gaming device. Apple TV’s challenge is that for most consumers it will never displace one of the first two, but there is a large untapped opportunity in that third slot. Just as Apple has created a new category of gaming devices by offering a compelling offering for games on mobile devices, it has the potential to do so in the home with a device attached to the television.

Apple has arguably already blazed a trail here with iPhone and iPad mirroring, which allows games designed for those platforms to show up on the big screen. But that relies on having someone in the room with the more expensive and battery limited device, and is principally a single player experience. An Apple TV with games could truly transform the home gaming space.

Evolve the iOS UI, which is beginning to feel dated

Apple pioneered the “screens of apps” UI, which launched in its original form in 2007 and evolved the following year with third-party apps, and which was copied by almost every other platform since then. But whereas other platforms have evolved (e.g. Android) or even pioneered entirely new models (Windows Phone), Apple has left the basic UI largely untouched since launch, with static icons limited to showing a single number as an indication of what lies beneath, and no widgets or other dynamic elements on the home screens. While the Notification Center enhancements in iOS 5 provided some improvements, they are limited and the widget functionality in the notification bar needs to be extended to third-party applications.

On both the iPhone and iPad, but especially on the latter, Apple should give consideration to home screen widgets, which could present much more useful information on the home screen itself rather than chasing users into the notification bar. Lastly, Apple also needs to emulate the Intents model in Android or the Contracts model in Windows 8 to provide better cross-application interaction. Today, there’s no easy way for third-party apps to send a wide variety of file types and information between each other beyond the fairly basic and limited “Open in…” dialog, and this limits the functionality of many apps unnecessarily.

Apple needs to wean itself off all third-party services, not just Maps

In iOS 6, Apple will replace Google’s mapping and location data and tiles with its own. This is an important step, as it removes its arch-rival from one of the most important elements of the platform – the mapping and location function. However, both Google and other providers remain deeply entrenched in a number of other places in iOS, and Apple should prioritize getting these functions replaced with its own where possible.

The most obvious examples are email, where iCloud (formerly MobileMe) offers basic functionality but has far fewer users on iPhones and iPads than Google’s equivalents; search, where Google is still the default option; payments, where Apple’s own infrastructure only supports official App Store or iTunes store purchases at present; and social networking, where even CEO Tim Cook recently. acknowledged that its own effort, Ping, was a flop.

The good news is that Apple has the rudiments of offerings which could eventually meet these needs in place already. Siri provides a foundation for an increasingly sophisticated search application, which may in time reduce the need for Google searches in the browser significantly. Passbook, the wallet app which is part of iOS 6, could be the basis for a mobile payments service in future.

But Apple still needs to make core personal information management applications such as email, calendar and contacts more compelling than Google’s equivalents. Partnering with Facebook and Twitter for social networking at least spreads the risk around and avoids Google, but Apple still needs to figure out its own strategy for social networking post-Ping. The social sharing features in the iOS 6 version of Photostream could be the beginning of an offering here.

Some of these are easier to fix than others, but Apple needs to find ways to remove Google in particular from other elements of its devices, so that it is not reliant on a partner which would rather be selling its own devices than helping Apple sell iPhones and iPads.