Apple pushes ahead with plans to launch streaming TV service despite balky content providers

“While Apple harbors big TV ambitions, it’s having a tough time getting media companies to play along,” Claire Atkinson reports for NY Post. “Apple is pushing ahead with plans to launch a streaming TV service by Christmas — despite making little headway in its negotiations with content providers, The Post has learned.”

“For months, Apple’s point man, Eddie Cue, has been leading talks with content providers, which have largely balked at the tech giant’s efforts to exert control over all aspects of the video service, including pricing, sources said,” Atkinson reports. “Apple’s negotiating stance can be summed up as ‘we decide the price, we decide what content,’ according to one source familiar with the talks.”

“Apple is pitching the idea of offering channels as apps for its devices, including its Apple TV set-top box. It’s unclear whether it would group the apps together and charge a fee — similar to a cable-TV subscription — or offer the channels on an a la carte basis,” Atkinson reports. “Apple hasn’t given up, however, and is said to be pursuing deals with telecom companies such as Verizon and AT&T. It hopes to get traction with a single player in hopes of pulling the rest of them along. While Apple is also rumored to be working on its own actual TV set, sources believe its first priority is to bring a TV service to the market.”

Read more in the full article here.

MacDailyNews Take:

“Content producers should get to work then on producing their own apps… We’ll make a folder of them on our iOS devices and it’ll look and act just like the channel lineup in the cable companies’ iPad apps.” – MacDailyNews Take, April 11, 2011

[Thanks to MacDailyNews readers too numerous to mention individually for the heads up.]

31 Comments

  1. I imagine the fear of the content producers and channels is that a la carte channels or shows without commercials eventually leads to less and less consumer media consumption, which leads to fewer channels and fewer programs being created, which leads to less and less consumer media consumption.

    That’s what I hear when people boast on this and other blogs about cutting the cable and going a la carte. “There are just a few shoes I wantto watch” folks say. “I don’t want to pay for all that other stuff” they say.

    Well, that’s a situation where not much $ is going into the network coffers and not too much gets produced.

    What COULD happen on the consumer upside is that everyone is enabled to become an indie show producer, like what iBooks Author is enabling. It would be YouRube, but with people getting paid.

    But how is that good for Hollywood or NBC/ CBS/ Fox, erc? It’s not.

    So I fail to see how Apple controlling tv through apps and a la carte will ever ever gain traction with the establishment. It’s not good for them, and I dot see how it ever would be.

    1. Nerd… you are on the spot on, but I’ll make it even simpler. IT’S ALL ABOUT THE SIZE OF THE POT AND WHO GETS IT.

      There are roughly 120 million TV households in the US today. Lets say each household currently pays $50-100/month (we’ll call it $75 average) for cable, satellite or other forms of TV. That’s approx $9bil dollars/month spent on TV consumption.

      Apple’s model won’t get the average consumer to spend more than the $50-100 dollars per month, so there is no benefit to anyone involved (except Apple and the consumer) to switch to this model.

      One of the ways that it can work is if Apple can get a foothold and cause people to start spending less (by dropping them completely) with the Cable/Satellite providers. Then Apple can come in and cause them to spend more just like they did with Music. That’s why iTunes worked for the Music industry… people weren’t spending for music anymore (mostly because of pirating).

  2. An app for every channel would be cumbersome…. An app with groups of like channels would be better but still not as convenient as the way it is now …. Apps are not the solution…. At least not as described do far

    1. Read the rest of MacDailyNews Take from April 11, 2011 which contains:

      “Sure, it’s not optimal to have channels groups strewn among several apps, but it’s certainly better than nothing.”

      The kernel of the idea is right there. Maybe MDN’s Take was even what led Jobs to “crack it” as it’s well known that he read the Apple-related blogs religiously.

    2. Such a limited vision. Do I need to open up an app to check the weather somewhere new or do I just ask SIRI, “What is the weather in ___”. SIRI is the secret channel surfing controller not the apps. The apps are the links or hooks in to the media source.

      You need a bigger vision on this. Apple is going to do something different. “Think different” and you may start to see where Apple is going with TV media content. Maybe iCloud VCR. Stream the content when you want to watch it. You can already watch past episodes using a Mac mini connected to a HDTV from the ABC, NBC, FOX, … web sites. That is what I do when something didn’t get recorded at my house and I want to watch it. “Think different!”

    3. When I look at the channels that I actually watch, I can’t see who they would be grouped. BBC America, Discovery, Comedy Central and AMC don’t have any kind of crossover other than being part of the basic cable bundle. But I don’t want basic cable, I only want those 4 channels, so I would rather have an app for each than get stuck paying for bundled content I don’t want.

    4. What if it was an iBooks type app from apple and the TV channels were an in app purchase? TV Store perhaps?

      You buy the network channel and get so many episodes or shows and then they in turn offer “premium” shows or content for additional purchase within the channel. They could conceivably charge for channel, and for highly rated shows attach a premium?

      Or perhaps they will have an AMC channel app and the shows will be in app purchase.

      or perhaps the shows will be free with embedded commercials,or premium versions available for a charge with no commercials.

      I think it is a very workable situation with multiple options.

      I just cannot wait to see what Jobs cooked up. He did tell his biographer he had cracked the formula and it sounds like he was excited about it.

    5. And I don’t think it is cumbersome at all. You are holding on to an old method for finding and launching apps I think.

      I have over 100 apps on my iPhone, I long since forgot what is in what folder. I don’t need to, home screen, swipe right start typing, BOOM there it is.

      Siri can make this even faster and easier.

  3. Apparently content providers don’t have a clue on how much money they could be making. Only worried about piracy and pricing to high for anyone to want to afford online content.
    Apple knows how to get this done, why don’t they listen and give it a try for once. The music industry doubted Apple with iTunes, now look how online music has taken over and is making money for both the artists and the music content providers. Oh sure, they still whine they aren’t making money, that’s because if they had there way everyone would have to pay $20 for an album download instead of $9.99. For them more is always better because they don’t think about the consumer like Apple does. Like Steve Jobs did.

    1. Beyond not having a clue, content providers are true dinosaurs in an age of instant connection and social media. They have demonstrated this prehistoric trait since the iPod was first introduced. Ultimately, they’ll either move into the 21st century with a new business model, or they will fail.

  4. Each channel is an app, but they are also each a subset of (able to be plugged into) a “control app” (Apple iTV app) and linked together via APIs so that they are all searchable as one, able to be grouped, sorted, filtered, etc.

    Each app can do whatever it likes on its own, but its video and program data (info: description, rating, running time, etc.) are accessible by Apple’s Siri-enabled “control app.”

    Users simply download the “channels” they want and they are automatically “plugged” into their “TVs” (iPad, iPhone, Apple TV, AirPlay) via the master control “Apple iTV” app.

    One master app to control them all.

  5. I’m waiting until the time when I can view just the channels I want to see – when I choose to view them. Maybe ‘channel’ is the old way of thinking, (think different).
    Could we ever get to being charged by the hour? If i don’t watch I don’t get charged? That’s the direction car insurance should go. I get charged when I’m driving, then pay a different rate when parked in my garage. GPS can be used.

    I know! – I know! Insurances companies will never offer that. I can dream, like S.J. can’t I?

  6. “I’m waiting until the time when I can view just the channels I want to see – when I choose to view them. Maybe ‘channel’ is the old way of thinking, (think different).”
    I don’t see much difference between this statement and how I manage my Sky HD satellite box. There are dozens of channels, but I just select the channels I’m interested in and list them as favourites, the same as I do on the app that allows me to remote record programmes and series link them when I set up the record. I can select a grid view just like on my TV as well. Sure, that’s not quite as good as an a lá carté service, but I’m ok with it, as channels come and go, series swap channels as well, so just having a favourites list suits me.

  7. It’s math

    CONcast and others rip off/charge customers $100+ (sometimes a lot more) to watch a package of channels owned by a small cartel that air mostly reruns, old movies and shitty low budget reality shows. And commercials- lots and lots of commercials.

    Your money gets handed over to the cartel even if you do not watch. Disney gets your money for espn 1-50 even if you don’t give a shit about watching adults being paid to play children’s games. Or talking heads blathering about it. Same for non-music MTV, non-history History Channel, non-Arts & Entertainment A&E, non-travel Travel Channel and now even the non-weather Weather Channel.

    Don’t even get me started on the non-news “news” channels…

    The simple fact is that the media empires are built upon debt- lots of debt and they cannot sustain their model on a la carte. They have wedged themselves into a financial corner and protect it with a cartel for production, an effective monopoly for distribution and a bought and paid for government for oversight. The customer is told in essence to bend over and grab your ankles.

    Until we break up the cartel or get a government not wholly bought and paid for by the cartel-like BOTH dominant parties-the whole thing is mental masturbation.

  8. I’d like to eventually get away from channels entirely – watch what I want (old or new content), when I want. The broadcast channel model was built originally for a one-way analog system. The incumbents want us to fit “old wine into new wine skins”. We need a new model for a new age. Right now the money flow (advertising revenue, broadcast rights payments) is entrenched in the current model and no one (except Apple) wants to move forward because loss of revenue by some of the players is inevitable as the model shifts. There is no impetus for the incumbents to change, and the consumers have little to no leverage, unless we all agreed to cancel our cable until they come around to offering what we want.

  9. The overall fear is because the compensation model for TV shows is so much different than for music and movies sales (DVD). For music and movies, people have always bought a la cart. 50 years ago people bought singles on 45 records.

    The problem with TV shows is that they really make their money from advertising. Networks buy shows to air because they can sell ad space. So the change to selling shows at $1.99 per episode or $20 for a season pass is pretty scary. What if people won’t pay?

    The other point is moot – Apple is not going to hold off on its devices waiting for the content providers to come around and agree, and THEN produce its device. It will get things mostly in place for content, then let consumer demand for the device and the promise of services force the content providers to play ball.

    Nothing is more powerful than creating demand, and Apple certainly knows how to do that.

    1. The $1.99 per episode isn’t very appealing for me, at least. I agreed with Steve Jobs back when iTunes began with regards to owning rather than renting music. I own 25 GB or so of music (CDs and iTunes purchases), so I don’t care now, as much about music subscription. But, I would love to have a content subscription service for TV and movie content – streamed content, not broadcast channels. “Siri, I’d like to watch a Marx Brothers movie”, or “I’d like to watch the 1992 World Series”, or “I’d like to watch the latest episode of Fringe”, etc… I have about 300 DVD’s – I’d much rather have access to a comprehensive online digital library. Netflix is good, however much more limited in Canada than the U.S..

  10. Why apps for channels? Who watches channels? Give me apps for the shows I want to watch! The producers of the popular shows should get my money not the network that decided the show was good enough for broadcast. Notify me with a badge on the icon when a new show is available and let me watch the reruns that I want to watch. A show could get cancelled on a network but still have enough of a following on app to keep going.

    1. A stand alone show app works as well as a stand alone channel app; both aggregate content around interest.

      The video podcast is a basic example of this idea, except that the app would add more potential.

      MLB.com may be a worthy example of an episodic show/network scenario with all the extras an app allows, including statistics, social media and target marketing.

  11. The problem with all the talk about cutting the cable/cord/dish is… how is the content supposed to get to whatever Apple device (or whatever) is being used?

    Oh, I get it!

    You don’t mean cutting the cable/cord/dish completely… just for receiving TV content directly.

    You’ll continue to use the cable/cord/dish in order to receive TV content… only through the indirect, roundabout method of the internet connection… that is furnished by the cable/cord/dish service provider.

    If this takes off, like so many appear to want, look for cable/cord/dish ISPs to drastically increase rates for internet service… along with increased caps and throttling.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.