Apple poised to reinvent TV?

Apple Store“It seems Apple is rethinking its TV strategy, in a way that might—if the company can pull it off—give consumers the option to pay Apple less than half as much as they currently pay their cable or satellite provider for a monthy TV subscription,” Peter Burrows reports for BusinessWeek.

“According to All Things Digital’s Peter Kafka, Apple has been trying to convince programmerrs to make their shows available as part of a subscription, available via iTunes. The monthly price would be around $30, he reports,” Burrows reports.

“No company is as well positioned to satisfy this demand than Apple. Many carriers have plans to make their content available in more numerous, and interesting ways… But only Apple has iTunes. Hundreds of millions of people have tthis program installed on their PCs, Macs, iPods and iPhones, and more than 75 million have an ongoing billing relationship with the online store by the same name,” Burrows writes. “Rather than any one product, it seems to me Apple’s greatest imperative should be maintaining iTunes’ role in these consumers’ lives. The Apple TV may never be a hit. But consumers that decide to get their TV via iTunes rather than their current provider will be much more likely to buy new Apple products down the road. Certainly, many would consider a device for watching TV that is more portable than a MacBook, but larger than an iPhone. A tablet device, for example.”

Burrows reports, “All of this remains conjecture, and assumes that Apple iTunes chief Eddy Cue can land the necessary content deals. It won’t be easy, since these partners will be loath to cross their current distributors. But don’t count Cue out.”

Full article here.

37 Comments

  1. this will just give broadband providers a reason to increase the monthly fees and cap bandwith.

    For example, no way Comcast will tolerate losing cable tv revenue while that same customer starts hogging bandwidth to watch tv via iTunes.

  2. the puzzle is the need to maintain a cable or satellite account for live sports – shows and movies i would gladly drop cable for iTunes, but is the new data center going to be bad enough to stream live sports?

  3. Most of these content providers are same people that fought and lost to Apple in the music industry. Despite Apple having saved their asses and extended their corporate lives, they perceive that battle as lost and are determined to not cede control of their video and TV content to Apple as well.

    It will take a lot of effort and persuasion (perhaps even by Jobs himself) to get them over. Disney should provide for an excellent start. Once Disney is on board and successful (financially), others will have no choice.

  4. If Apple was going to do this, Apple would need a extremely large server farm to stream the media. Much like the billion dollar one that Apple is building in North Carolina.

    You would think that the talking heads could see the obvious clues!

  5. The model that is working for me is Netflix’s instant offering. I can watch content via my Netflix capable BluRay player or on my computer. I’m already paying for their subscription service and the instant stuff is free.

    The only downside is that offering are limited to older stuff and some content isn’t available all the time.

    Apple have the same capabilities with the AppleTV and your Mac or PC and iTunes. I just can’t see them getting a lot of content. I would gladly cut back on my cable but the reality is that the coverage would have to be wide to facilitate that.

    Apple do have a wide audience in iTunes. The question is can they offer a reasonably priced service with good content?

  6. I have my TV on for hours a day, even if I’m not watching it I’ll typically have it on in the background, no way my internet connection could handle that and that’s only 1 tv. Only a few countries could do this as a direct replacement for TV.

  7. No way Apple will be able to sign up ALL the channels that would allow people to ditch even their basic cable needs. And $30 is twice what I pay for cable already. USA, TNT, the networks, etc.. that’s a lot of ducks to get in a row. And are they going to charge more for HD? I refuse to pay extra just for that.

  8. I would like to see Apple (or anyone else) succeed in a *new* model. I still want a way to see live sporting events (with DVR functionality of course). I have DirectTV and there’s so much junk — there are really only a few programs worth watching. I’d be interested in a new model to get content. The current iTunes programming and per show model isn’t quite there for me yet.

  9. I’d love to live in a country where monthly cable bill is $15. Unfortunately, here in the US, it’s more like $80 (and that excludes any premium or local sports programming). That is, unless you are fortunate enough to live in an area where you are allowed to install a satellite dish, in which case you can get away with $50 or so… Still far more than $15.

  10. Here is how it will play out.

    With the economy in the dumpster for a few years, people will start dropping cable, because when the choice is: spending $85/month on cable TV or food, food wins out.

    The content providers will then see their income drop like a rock as cable TV delivers fewer and fewer subscribers. When the content providers’ income drops, they start to get real hungry for new sources of $.

    At that point Jobs/Cue walk in and mention that iTunes poured lots of money into the music industry–money that the industry thought was lost to piracy. iTunes can do the same for you boys in the TV industry. Why don’t you give us a try?

    The content providers then look at their spreadsheets again, realize the Apple/iTunes have a solid record of success and the most extensive customer base for media, and then sign on the dotted line.

    The bottom line is that the stars seem to be aligning for a new approach to delivering TV shows. Personally, I would love to pick the cable channels I want from iTunes every month and pay a reasonable subscription fee for each channel. In essence, every consumer could be his/her own cable company by putting together a package of channels that they want rather than the ones Comcast offers you.

    This could be nirvana for TV watchers.

    BTW, for the naysayers who state that Comcast will simply raise their broadband rates to stem the tide, well, that’s where the free market comes in with a little help from the FCC and net neutrality rules. I have four ways to get broadband internet into my home: Comcast, Verizon, Clear (4G wireless), and satellite. If Comcast raises their price, I’m sure their competitors will be happy to accommodate the new customers at a price less than Comcast.

  11. @MXNT41

    I have UVERSE and ALL their content is pushed through the pipe. HD looks great, stream NEVER stutters. I’m getting 25MB/sec pushed to my house.

    Perhaps apple is teaming up with ATT on this one as well and they can subsidize the appleTV (almost free) if the customer gets a UVERSE account? Seems like a double FU to Verizon.

    (1) iPhone remains ATT only

    (2) AppleTV/tablet remains ATT only

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