“Apple has been rumored to be making the TV network rounds once again, in order to build an affordable and disruptive streaming service,” Mark Reschke writes for T-GAAP. “Sounds great, but there is one mammoth hitch. If pricing is not aggressive enough it will not be well received.”
“Consumers dislike their communications companies as much as they disliked their mobile phones before iPhone. Comcast, Time Warner and DirecTV bundle packages are overpriced and deliver far too many programming options people do not care about,” Reschke writes. “If Apple can bring to market a set of desired network options at affordable rates, Apple TV and its service would force cable entities to offer more choices, or lose subscribers.”
MacDailyNews Take: The cable/satellite box interfaces that come with every single cable system we’ve tried make Microsoft look like genius UI designers in comparison. Yes, they’re that bad.
“The most recent information comes from JP Morgan’s Rod Hall, who reported that Apple’s TV package will provide 25 channels along with a monthly fee of $30 – $40,” Reschke writes. “Millions of U.S. cord cutters pay $40 – $60 a month for 10mbps – 25mbps internet access and download speeds. Adding another $40 for a streaming bundle pushes the combined price nearly to that of cable bundled cable packages, which provide hundreds of channels, multi-channel DVR capabilities and superior image quality over that of live streaming solutions. If Apple cannot provide a pricing model that makes sense to cord cutters and current cable subscribers alike, what is the motivation to change habits and purchase Apple’s network bundle?”
Read more in the full article here.
MacDailyNews Take: We’ll have to see what the offer is exactly, but it’s highly doubtful that Apple would bother if they couldn’t deliver something unique.
What I am willing to pay depends on what is offered and how it is configured. If I can select the channels I pay for and opt out of stuff I have no interest in- good. If all they are offering is a net delivered miniature bundle of the same crap Comcast offers I am not interested.
I watch only a handful of live sports events and have no interests in subsidizing ESPN by buying the whole bundle of talking heads. Pay per view on College Football would be nice.
I still want to pick my own channels. Not packages! I have dish right now and use a custom list and maybe watch 20 channels or so. What scares me is if each channel is $10, then you are right back in the same pricing range! But why pay $20 for this package and say you want this other channel in the $40 dollar package, its just not right!
That of course is the joke. We finally get ala carte and it ends up costing the same, but with far fewer channels.
I would happily pay .99 cents per channel, and I get to pick what channels I want. I don’t think I’ll want more than ten.
so is that .99 cents per channel per month?
if so you got the right idea !!!!!
why — because if Apple plans to set monthly rates at 40 – 60 bucks a month – add in the cost of your internet, and if you do not have unlimited data – its gonna hurt. If not it will all seem no different at first form the Cable company’s offerings.
If you can be lucky to have unlimited data for 40 bucks.
And then start paying Apple for channel bundled at 40 bucks. Simply you are at 80 bucks a month.
What was the cable companies price again, oh gee 80 bucks.
Now if you happen to not have unlimited data, your cap will easily exceed your monthly allowance and sky rocket. Expect to see 200 bucks for internet a month.
This guy’s logic is flawed. Why is he including the cost of Internet in cord-cutting costs? Everyone already has Internet, and would-be cord-cutters already have cable AND Internet. The cost of Internet is irrelevant for this topic whatsoever.
I have Charter for cable, internet and home phone. I pay $125/month for all three – the break down on my triple play package is $65 for cable, $40 for internet, $20 for phone. A little over a year ago, I considered converting to a Mac mini as a media center, and doing away with my cable service. When I contacted Charter about ditching the cable portion of my triple play my bill would still be $125/month – the internet jumps to $85/month, and the phone jumps to $40/month. If I did away with the phone also, the internet alone was $105/month. The cost of internet is not irrelevant … because the cost of just internet service goes sky-high, and they’ll make it even more expensive if enough people drop their cable – from which they make some money in advertising – for just internet service.
Based on the numbers they quoted me last year – it doesn’t make sense for me. My current cable package includes just about everything – including HBO, Showtime, Cinemax and Starz. If I go with just internet at $105/month, and HBO NOW at $15/month, I’ve only got $5/month left to spend before I’m paying more than I am now with everything.
Which is a business model that will slowly change as IP become more predominant for video than RF. Yes, you will still have to pay more for bandwidth for several reasons, one being to make up for lost revenue of video to maintain the plant and another the ISP’s need to CONSTANTLY upgrade equipment from the headend to the node to the amps to the drops to handle frequencies better to allow the heavier internet usage.
One thing that is being deployed (I hear…) are servers for companies like Netflix to cache the most heavily played movies, etc, locally at the ISP to free up one bottle-neck (to said main servers of Prime, Netflix, iTunes, Hulu….). Things like this will help smaller markets to a degree..
I was paying $74.99 last month for 15/15 FIOS internet. For $10 more I have 50/50 for a 2 year agreement. But after that it will probably go up to $105 and I probably screwed myself because 15/15 won’t be available then. I don’t think you can get it now if you ask. These prices are ridiculous just for internet access! $40 sounds more fair to me!
Most ISPs- including Comcast and AT&T- have capped the data your landline internet account can use without being charged extra. Currently Comcast caps data at 300GB and sees extra data at a $10 per 50GB block on residential accounts.
HD video can easily swallow that amount of data in a month.
And yet that is way more DATA than it’s systems could handle 5 years ago.
Keep in mind it is evolving, and the caps were aimed at hogs. 500GBs will probably be the norm in the next couple of years.
The bigger point is that On demand (TiVo & Cable Box on via CableCard) are not counted against your data cap. Streaming services like Netflix, Apple TV and Hulu are counted against your data cap. I do not see any of the writers factoring that in the equation in articles like this.
Bravo DavGreg.
As most of the Cable companies up here in Canada actually offer Internet, and Companies like Rogers and Bell sublease connections through what seems like, independent smaller companies disguised as competitor. What essentially happens is, the Cable companies can simply adapt – and get their money in the end anyways.
Can not see Apple doing anything about this at all.
Offering a selection of channels is interesting but will solve nothing. Netflix will be seen as doing a better job if Apple merely offers packages. And since we all still pay for (the other wire to our homes – the Internet – controlled by Cable companies – what out.
Mike has a point. Its just that he might not know of other situations. As his and mine are different.
Cord Cutting refers to cutting the Cable Television companies of the bundles and forced feed channels they offer.
There are alternatives to Rogers and Bell here in Canada.
We can find INTERNET providers alone. And Unlimited service from the likes of Teksavvy, Acanac, Primus etc.
And paying all about 34 – 45 bucks a month.
We have 3 HD satellite boxes in our house, all cable of watching and recording at the same time. Since the internet in our area maxes out at 7 meg with no sign of improving, it doesn’t matter what Apple offer, it’s just not going to come close. The problem is, with Amazon, Netflix, Hulu, Yahoo, and others all offering exclusive content, the same problem is arising online. To get everything you want is still going to cost.
Depending on what channels are available–anywhere from $25-$40. Definitely has to have ESPNU, SECNetwork, ESPN3 and the major networks. Also a break on bandwidth costs would be huge imo..
I do not wish to subsidize ESPN and certainly not the SEC Network. If you wish to, be my guest.
I watch at best 8-10 College Football games a year- including bowl games. I just have better things to do with my time and am a weekend worker.
I don’t want a bundle. And I’ll only pay up to $9 a month per channel, like I do for Hulu and Netflix, and odds are the only other network I’d want would be HBO, but it’s just not worth $15.
RevDrX you are so very RIGHT!!!!!
Agreed on HBO. There’s one, or maybe two series I watch there. One season per year each, so for $180 a year I could buy both seasons to keep forever, and still save $100.
It has to be under five dollars a month otherwise, why bother changing?
Well some confusion there.
Netflix is not a Channel its, 9 bucks for a huge variety of ON Demand content. As is Hulu and HBO.
Channels, come from the Cable Company where they place a particular Network to be showcased on. Channel 5 Cable 10 for more confusion of the past… but that channel has a variety of News, Entertainment, Sports and Shows. Just not as Huge variety or ON demand content as Netflix is.
However, Netflix and others ON Demand do NOT offer LIVE coverage.
That is, five bucks a month per channel…
Yes, but only a dollar per month for each of the broadcast channels (I doubt the local affiliates will play along with this plan): ABC, NBC, CBS, FOX, PBS and the CW. 😃
I’m not optimistic Apple will offer a competitive price for what DISH sells me.😰
Almost $100 a month including HBO & Showtime.😱
the max i will pay is $20 per month. i only need espn, the nerdy channels, and truTV
You “need” ESPN?? Great, you’re the reason cable is so expensive in the first place. I hope apple never bundles ESPN with anything, and they charge you $50 a month for just just one channel.
Local pro sports are still a must in most months. If they don’t have that, it will be very limited or most likely continue to use as I do now. For music, You Tube, Netflix, iPad/iPhone streaming.
No doubt the UX will be vastly improve but still will no trump content. Ie local news/sports
Have no desire to subsidize the NFL, MLB, the NBA, the NHL or whatever Soccer league is currently operating in these United States. I certainly do not care to watch the ratchet jawed sports spokesmodels that fill the hours on ESPN, Faux Sports, CBS Sports Network & NBC Sports Network.
$20 for all 5 broadcast networks on demand plus USA, TNT, SyFy, WGN, AMC, TCM, and ABC Family. Plus $5 for LIFE, SCI and FX.
There are six broadcast networks: ABC, CBS, NBC, FOX, PBS, and the CW.😃
Yeah no. Not paying for PBS at least not two or three times.
DirecTV costs us $68 per month for the least expensive package. We watch only 8 channels. I would buy any Apple package if (1) we got those 8 channels, (2) if we could record shows for later viewing with the ability to skip over commercials, and (3) the cost was less than our current DirecTV contract. We record virtually all shows and almost all in HD. Without these conditions, we’ll stick with what we have.
I only need about 10 channels which covers things like Discovery and Science channels. I’ve got a good OTA antenna for all local stations. I’d only want to pay a max of $5 a month per channel. None of this is going to happen, but it’s nice to dream about.
Paying for a cable service should only account for the cost of bandwidth. The shows themselves are perfectly capable of making their monies from ad revenue.
Nothing. Because until bandwidth becomes affordable outside of metro/suburban areas (the bulk of the US landmass) a “TV” subscription is useless when the bandwidth costs $10/GB or more.
I’d pay $20/month to get rid of the god-awful Comcast remote.
Right? Why is the comcast so awful?!?! Every other remote i don’t have to look at the buttons after a period of use. With Comcast remote, the layout is horrible, the buttons are unresponsive, and it is impossible to use in the dark. With the billions they bring in, you would think they could design a usable remote.
$3.50
“…. and superior image quality over that of live streaming solutions.”
Current DIRECTV subscriber (at $120/mo without a single movie channel – and this does not include the $78/mo I pay for 45mb internet) – previous Comcast and AT&T Uverse TV subscriber. I can tell you that not one of these services has “superior picture quality”. Their compression has gotten so bad that we’ve stopped DVR’ing most of our favorite shows because the picture quality is actually MUCH better on Hulu Plus.
Not a big sports fan so we’ve finally decided to drop DIRECTV and live off Hulu Plus, Netflix, Amazon Prime and HBO Now – all services we’ve already been paying for. If Apple can add channels we care about for $25-$40/mo with picture quality as good or better than these – I’ll happily hand them my money.
I wouldn’t pay much as I’m on the comcast 300GB limit, you burn through that real fast when you get all your media over the internet. You’ll see all the ISPs going to limits and will kill the internet TV/movie revolution.
for a subscription? NOTHING. For a la carte, I would pay just as much per month on average as the typical 200-channel cable TV subscription.
Apple needs to think about user experience rather than becoming just another middle man in the TV market, as they have become with music and iTunes.
I DO NOT WANT CHANNELS!
I don’t watch channels. I watch specific shows. Or a specific sporting event. Or a specific movie.
With movies and TV series, I’m very fine with what iTunes offers, thank you (except that it needs to be more complete and more consistent, language track wise, here in Germany).
For other programming, I could be talked into a stream. However, this stream needs to be highly individualized and configurable. My own sports channel, so to speak, that only shows the sports and events I actually want.
I don’t want others to decide what I can watch NOW.
Exactly! Me too, I only watch interesting shows, and HBO has done a great job with their pricing to illustrate how it’s much much less expensive to just buy the seasons of the shows I want to watch than to subscribe to their one channel. So will be the case for everything else. The ONLY thing I’ll pay for as a channel is CNN or some other form of news, so I can know what’s going on in the world. But even CNN has junk TV shows taking up half their air time.
IOW, the only way I could be talked into a subscription is when the product I’m subscribing to is vastly different than traditional TV programming.
I’d want every frakkin’ program (not channel) there is now or will be available to me at all times, as long as I could choose which one to watch, or record, with no limits. For this I’d happily pay what I’m paying now for my limited cable stations. But, not more.
Apple needs their own satellite capable of handling your phone calls, internet browsing, and HD streaming video needs. If they could pull that off while delivering a smooth experience they would kill the cable, telecom, and internet companies.
Apple TV’s current interface is also terrible. If you have a large music or video library, navigating through all that is a major pain on Apple TV. And turning on features like repeat isn’t intuitive. Apple will hopefully shore this up. Most of the issues I have with Apple TV are due to the extremely dumbed down remote. But even the Apple Remote App doesn’t make things much better. This article complains about Cable and Sat interfaces without mentioning how ill-suited Apple’s interface is currently. Hopefully they have something great in the works.