Apple arming itself for full-on assault in Internet content war

“Apple Inc appears to be arming itself for a full-on assault on the $150 billion-plus world of multimedia content and distribution,” Poornima Gupta reports for Reuters.

“The move would pit Apple more directly than ever against new-media rivals Google Inc, Inc, and even Netflix Inc, which all want to be an online hub for Web video, music and pictures,” Gupta reports. “Apple’s edge comes down to its record of striking deals for key content, most clearly seen in digital music service iTunes. It also has a big cash pile. Apple is estimated to be spending up to 5 percent — or over $5 billion — of its expected annual revenue this year on capital investments, most notably in a North Carolina data center that will dwarf its current one.”

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Gupta reports, “‘The future is … you want to be able to shift your content between all your screens and be able to do that pretty easily and seamlessly,’ said Peter Misek, Jefferies & Co analyst, who expects a fee-based video service from Apple in about a year. ‘I can think of no other company that would be better at making something really dummy proof than Apple,’ he added… The company is likely to address some of its cloud-based plans at its Worldwide Developers Conference next month… ‘They have made a big investment in this (cloud) space and so we expect it will be something substantial when they do it,’ said Channing Smith, co-manager of Capital Advisors Growth Fund.”

Read more in the full article here.

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  1. Meanwhile, the iTunes Store is missing 95% of the movies that I would like to rent or purchase. It seems like Apple only strikes video deals for NEW CONTENT and NEW RELEASES, and leaves the back catalogs by the wayside. That is why I will ONLY stick with Netflix… I get EVERYTHING — all old stuff and all new stuff — for only $9 per month.

    1. Kinda hard to say one gets “everything” with Netflix, unless you mean two or three days after you order it and on a piece of plastic. In terms of streaming, they pretty much only have old stuff.

      1. Let me clarify it for you, replace “everything” with “enough” or “more than anybody else for the price”. K – done arguing semantics now?

        NetFlix is AFFORDABLE, it works on just about EVERYTHING. There are 6 people in my house, all varying interests and ages, and yet every single person in my house loves it and uses it regularly.

        The only real problem I see is the ISP’s are getting greedy and want in on the party and are imposing bandwidth caps.

        1. “I get EVERYTHING — all old stuff and all new stuff” versus “enough” or “more than anybody else for the price” is not a matter of semantics. Everything (especially when yelling) has a far different meaning than “enough.” There is no “Truth” in “MacBill” in this case.

          I currently subscribe to Netflix streaming, but they definitely have a lot of gaping holes in their movie catalog.

          I see no reason why Apple cannot eventually surge past Netflix in terms of its movie catalog. But Apple may be better served by working with Netflix. The reverse is true as well, much to the dismay of Googlevil.

    2. But only for US-citizens. Netflix is US only, leaving 6.4 Billion people without Netflix. Apple operates globally (and thus more profitable). In other words : NO ONE, outside the US, and that’s the majority, cares about it.

      1. To be fair, I don’t think this new data center will have much impact internationally. You have to understand, media contracts vary from country to country. Why do you think you can’t buy content from iBooks in Mexico for example.

            1. Awww, that’s cute. Going after a typo. And yet, you didn’t really refute my statement. And the reason you didn’t refute my statement is because it is true.

              You may think Mexicans are precious, but I bet Brian Stow doesn’t.

              They’re taking over our country, and they’re going to ruin it – just like they ruined the place from which they came.

          1. “They’re taking over our country, and they’re going to ruin it – just like they ruined the place from which they came.”

            You do realize that a sizeable chunk of present day USA was taken from Mexico, right?

      2. KittyCat the Apple spokeswoman is on her hustle, lol. The original poster has a legitimate complaint about iTunes content and your response is “Well Apple is more profitable!” How exactly does that benefit MacBill if Apple can’t use its mighty profits to get the right content deals in place?

        1. Well, Major Pain-in-the-ass, perhaps because it was

          a) US centric?
          b) thus his suggestion useless for anyone else
          c) just plain wrong. (there ARE classic/older movies on iTunes. A lot of them)
          d) the profitable point was never THE point of my posting

          R2, the original lame troll no one likes….
          Now do your homework, kiddy. You won’t get you cookie otherwise.

    3. Hi MacBillGATES!

      It’s nice to see ya back once again with your wonderful disinformation, as always glaringly negative about Apple…

      RE: “I get EVERYTHING”

      lol! Everything? Really? I’ve found the online streaming Netflix selection is mostly older or ‘B’ movies, but they do have classics and SOME newer ones. The great thing about Apple TV is it gives you access to both Netflix and Apple movie streaming services. It should be interesting what the new data center adds to the mix.

  2. In Canada, Netflix is very limited. There aren’t any new releases and virtually no main broadcast TV at all. There is lots of cable channel shows but none of the majors. I think Apple could make a huge push in this market and effectively and quickly turn all of these content providers in to smoldering ruins. Ala Napster.

  3. Remember guys. Most, if not all, of the problem is the big media companies. They are the ones that place limits on when and how Apple gets content. I’m sure Apple would offer much more content if the media idiots had half a brain.

      1. This will luckily never happen. You completely miss the point of why apple is successful in this arena.

        Apple does not make content. They make the distribution. This is why Sony fails, and will continue to fail: Sony is a huge maker of music and movies, why would I sell my songs and movies on Sonys platform. They are my competitor. Apple is not any one in the media industries competitor.

        Apple should not, and will probably never create music or video content and instead build relationships with content providers.

        1. Wrong.
          The world wants content. It has an endless appetite for content. Sony floats because of its content royalties, in part at least. It bleeds money in areas where it competes with Apple et al.
          Content, or information of any kind, is theonly commodity that you can sell and sell, and still have it all in your ownership. Ask the Getty People. Because of piracy and consumption/repeat-fatigue, you have to keep churning it out, as you deprecate the old stuff.
          A distributor is just a pipe.

  4. If Jobs can get a deal to stream ESPN we would see a tsunami of cable cutters. I know so many people, myself included, that consider cable solely for sports. Apple, Inc has already shifted the power in the music industry, and the mobile phone industry. Here’s to hoping he can shift power in the cable/sat industry too.

  5. “If Jobs can get a deal to stream ESPN we would see a tsunami of cable cutters.”

    You are sooo right, anaknipedro. Can’t count how many times I’ve heard that from many types of people. While I don’t think it’s the primary domino, Apple getting ESPN would be huge.

    As gotwake says, the real villains in this story are the media conglomerates. Apple has jumped through many hoops – some it won’t ever admit to – just to get them to embrace the future, all for largely naught. The holders of video content don’t want to give control of their business model to Apple, as they think the record companies did by accident. And they all (music & video companies alike) want more than anything to turn us all into a nation of renters, where every time you watch a show, even the same show, on pads or phones or TVs, you pay them each & every time. Ownership, paying once for content, and fair use rights will all go out the window if they get their way.

    I’m not too sure Jobs is totally against this line of thinking (current Apple strategy indicates he sympathizes), but he should be totally against it.

    Take SONY as Exhibit A: SONY got huge in the 70s & 80s because it made innovative devices that allowed people to watch & listen to their paid for stuff in ways once undreamed of (VCRs & Walkmans), and they had to fight the content providers to do it. There would be no such thing as recordable audio cassettes, VHS tapes, CDs, or even MP3 encoding had companies like SONY not once fought vigorously for them, and the devices that used them. SONY went to the dark side when it became a content owner – it soon stopped making innovative products in lue of easy rent-taking.

    The same will happen to Apple if it goes down that road. As it is, they are dancing to the ‘parasite tune’ too much as it is. If Apple was smart, they would leverage Supreme Court rulings for Fair Use to the hilt. The AppleTV would become a monthly fee-free TiVo in addition to all the other things Apple has been using it for currently. You’d be able to record anything coming over the air or cable that you can record with 30yr old VCR technology, and AirPlay it to whatever device they can dream up & sell you, wherever you are in the world. As long as you aren’t re-selling the content your self, no harm/no foul to the content providers (you already paid your cable bill or watched the commercials). And Apple’s income on device sales would probably double or triple from it’s current rate.

    I’ve been saying this for a while now. Years and years. Often I’m told Apple has it all under control doing things the parasite’s way, I just have to be patient. Yet a new year comes & goes and we’re still lamenting the same shit – no content. The longer it goes the more I’m convinced: Apple needs to be SONY circa 1977 – balls to the wall & to hell with the content providers. Let them wallow in the wake of what the technology is capable of.

    THAT’S the primary domino. I just don’t think Jobs has the balls to tip it anymore.

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