Apple's TV Plans Fell Apart Over Content Owners' Resistance to Skinny Bundles

[MacRumors]

Following comments made by CBS CEO Les Moonves on the state of Apple's rumored television service, news leaked confirming Apple has put plans for such a service on hold for the time being due to difficulties securing content deals.

While Bloomberg spoke to a source that chalked the failed negotiations up to media companies demanding more money than Apple wanted to charge for the service, Re/code's Peter Kafka has added some additional context, pointing towards a reluctance to unbundle channels as another factor that killed the service.

Apple was hoping to offer a limited bundle of approximately 25 channels at a price of $30 to $40 per month, but even early on, there was pushback from content providers who wanted Apple to offer all of their content rather than just a few select channels. A rumor in April concerning negotiations between Disney and Apple suggested Disney was pushing Apple to include most of its content, including ESPN, Disney Channel, Disney Junior, Disney XD, ESPN2, ESPN Classic, and more, while Apple wanted to offer just a few of Disney's channels.

According to Kafka, the situation with Disney happened with other content providers, many of whom did not want to offer just a small selection of channels from their content catalogs.

Apple's beef with the TV Industrial Complex is a bit more nuanced. It's also a significant one: If Apple gets its way, TV will undergo a significant change, just like the music business did when Apple launched its iTunes store in 2003. [...]

If Apple gets its way, it means the traditional pay TV package, which averages around 100 channels, will get shrunk by nearly 80 percent. And while TV executives will say that they understand that consumers don't want to pay for channels they don't watch, all of them will argue that their channels are must-haves.

iTunes chief Eddy Cue offered media companies an option to sell additional tiers of channels (such as a sports package) alongside a core service, but refused to compromise on offering a larger number of base channels. "He doesn't want to have filler," a TV executive told Re/code.

According to Re/code's TV industry sources, Apple has been "quite vocal" about the end of negotiations with media companies, which stopped a couple of months ago. While Apple has suspended its plans for the time being, rumors have suggested the company isn't "giving up entirely" on a television service.

For the time being, Apple will focus on its tvOS App Store, offering content providers a platform to sell content to customers. As Kafka says, Apple may be able to change the minds of media companies if it can prove the Apple TV is a "transformative platform," but the company has a long way to go to reach that goal.

Article Link: Apple's TV Plans Fell Apart Over Content Owners' Resistance to Skinny Bundles

 

[sudo1996]

Of course. Many have tried and failed to do this, and I didn't think Apple had any special way to make it work.

 

[macintologist]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

 

[duffman9000]

Of course. Many have tried and failed to do this, and I didn't think Apple had any special way to make it work.

I agree, but I don't think the fight is over just yet.

 

[duffman9000]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

I know. I have to pay for a bunch of crap just to watch the handful of channels I do want to watch.

 

[gotluck]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

$30-40 will only end up getting you maybe 5 channels when all this a la carte stuff is all said and done I wager

 

[jekyl]

Even the package Apple hinted at is of no interest to me. OTA, YouTube, and twit.tv give me all the entertainment I need and do it for free. If the media companies don't want me in their audience, I'm good with that.

 

[mlabonte21]

For the love of Pete,

Here's what you do Apple:

Figure out a way to integrate this:

into this: ------->

and also add this:

to this --------------------->

Pour your billions of dollars and engineering to perfecting OTA reception. Slap on the usual Apple interface polish (7.1 WHABC-TV listing = ABC) and....

Voila! The TV industry will collectively **** its pants and will come back to the table and reason for a more acceptable price.

This would terrify them.

 

[yaxomoxay]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

What if you had a pool of 150 channels, and you could choose the 15 you want for $30, and $2 for each extra channel that you might want to add?
(of course this would include "on demand" for stuff that has been on the air already).

 

[Lesser Evets]

People are bailing the cable/satellite game because content is useless on almost all channels. Pick-n-choose entertainment like Netflix has begun to rule. The dinosaur media, corrupt with useless content supported by package schemes, is going to have to rot off a few limbs before it limps into the bandwagon of the future.

 

[BrentD]

You mean to tell me that networks want to continue requiring a bundle of a bunch of channels you don't want tacked on the the few channels you actually do want so they can charge more for the "privilege"? Shocking, I tell you!

 

[naeS1Sean]

I'm sure I'm not the first to point out that Steve would have gotten it done...

 

[teknikal90]

Turns out some guys finally figured out game theory.
The music execs didnt against apple with itunes..
the telecom carriers didnt against apple with iphone
and the book publishers didnt against apple with ibooks (although the lawyers did)

The network execs did.
As soon as one network buckles, everyone will be forced to buckle.
But if everyone bands together, apple will have no power and everyone will continue to enjoy being able to charge customers for channels they dont want.

Eddie Cue didn't manage to conjure his magic this time

 

[H2SO4]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

I’m just wondering how this is any different from paying for Apps that you don’t want or use……….Stocks, Game Centre, Tips, Watch - in fact anything you don’t want that could be replaced with something better or not at all.
Their business model depends on including some useless crap. Just like Apples.

 

[jekyl]

Even the system that Apple was working toward is too fat for me. I would opt for a solution that would give me all of the shows, up to date, watchable when I want it, for under $10/month. Anything other than that does not interest me. I can get enough entertainment using an antenna, YouTube, and TWiT.tv, all of which are free.

 

[easy4lif]

I'm sure I'm not the first to point out that Steve would have gotten it done...

I don't think he could have. A lot of other media industries were weary of apple after what they did to music

 

[tuslaw12]

I really hope apple continues to fight for better tv control. We have a basic tv package and it's way more channels than what we'll ever need. I'd switch to a new service like this in a heart beat

 

[AdonisSMU]

There's no way I'm spending $30-40 for content. No way. There's a reason I don't pay for cable, I don't want to pay for a bunch of channels that I'll never watch.

Right. Apple wanted to allow the user to choose what they wanted rather than offering up 100s of channels worth of content people aren't here for. I'd rather pay per channel. Then I can decide how much product I want.

 

[Mr. Donahue]

Only time will tell

 

[SteveJobs2.0]

Turns out some guys finally figured out game theory.
The music execs didnt against apple with itunes..
the telecom carriers didnt against apple with iphone
and the book publishers didnt against apple with ibooks (although the lawyers did)

The network execs did.
As soon as one network buckles, everyone will be forced to buckle.
But if everyone bands together, apple will have no power and everyone will continue to enjoy being able to charge customers for channels they dont want.

Eddie Cue didn't manage to conjure his magic this time

Based on his general level of competence I doubt that he conjured much of anything in the past.

 

[Rogifan]

Of course. Many have tried and failed to do this, and I didn't think Apple had any special way to make it work.

This isn't like the music industry in the early 2000s. Media companies have all the leverage and they're not dealing with people steeling their product.

Eddie Cue didn't manage to conjure his magic this time

I get the feeling Steve was the closer not Eddy and Tim is hands off.

 

[TheRealTVGuy]

I just like the pert of the article that states "Eddie Cue... Doesn't want filler". Which shows there's still hope that Apple is in the consumer's corner. (Even if it helps their bottom line)

 

[BSben]

I am thinking getting rid of my cable tv channels. I don't want to pay for channels that I don't watch. With the technology we have it should be extremely easy to pick the channels I want to watch, but unfortunately it isn't. I pay for children channels, and if there is one thing I never want in my house is children, nor do I want to finance crappy sports channels.
I think I will cut cable telly off and go just Freeview or even Freesat (they are a UK thing). A big shame Apple didn't get their way on this.

 

[AdonisSMU]

I’m just wondering how this is any different from paying for Apps that you don’t want or use……….Stocks, Game Centre, Tips, Watch - in fact anything you don’t want that could be replaced with something better or not at all.
Their business model depends on including some useless crap. Just like Apples.

Apple's depends on bundling useless stuff to your iPhone/iPad/MacBook?

 

[Romey-Rome]

Same thing as music industry back then. "You want two songs? Buy the whole album."

No cable for at least 5 years now. Hulu/Netflix/Kodi/HDHomerun/Usenet for early releases. Suck it.

 

[dwsolberg]

I'm doing my part as a cord cutter. I get the OTA channels plus HBO, Netflix, and Amazon Prime.

My prediction is that when Netflix and Amazon Prime start scaring cable and broadcast channels, we'll see some deals. Until then, they will continue the slow bleed.