Apple Collects 15% of Revenue Generated From HBO NOW and Other Apple TV Apps

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Apr 12, 2001
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While the terms of the Apple-HBO partnership behind the launch of the HBO NOW streaming TV service on Apple TV last month have not been disclosed, Re/code reports that some Apple TV content providers, including Netflix, Hulu Plus and MLB.TV, provide Apple with 15% of revenue generated from monthly fees for subscribers that sign up through the set-top box.

Apple collects 30% of revenue generated from the sale of iPhone, iPad and iPod touch apps, including in-app purchases, so the commission for Apple TV apps is half the amount developers are forced to hand over through the App Store. While the difference does not make a difference for consumers, the lower cut could make Apple TV a more attractive platform for HBO and other cable channels.
"But it's even more interesting to think about Apple's tiers of fees as we enter a world where lots of people are going to be selling Web video subscription products via platforms like Apple's. Whether Apple is charging 15 percent or 30 percent a month, it's giving distributors a much better deal than the 50 percent that pay TV providers usually charge premium networks like HBO. That makes the platform even more enticing to cable channels that are thinking about stepping outside of the traditional pay TV bundle -- and it puts more pressure on the cable guys to sweeten the deals they already offer."
The report adds that HBO is in negotiations to reach HBO NOW distribution deals with its existing pay TV distributors, enabling them to sell the service to their existing subscribers as an add-on. HBO is said to already have a deal in place with Cablevision and is reportedly in talks with Cox and Verizon as well. HBO NOW is exclusive to the Apple TV among streaming boxes for three months, at which point it should expand to other devices and platforms.

Article Link: Apple Collects 15% of Revenue Generated From HBO NOW and Other Apple TV Apps
 

teslo

macrumors 6502a
Jun 9, 2014
928
598
i've yet to successfully search for the answer to this: is HBO NOW a full HBO catalog above and beyond GO? i've seen most HBO shows so i wouldn't get much value there, and the A-Z movie listings on GO are kinda paltry.
 

tasset

macrumors 6502a
May 22, 2007
568
192
Seems like pieces are falling into place now for the AppleTV subscription service. 10-15% makes sense especially if the content providers have to provide the streams (and therefore all the bandwidth) as rumored.
I also have been much more inclined to sign up for HBO, Netflix, and Hulu through Apple due to how easy it is to cancel at will. THAT is great customer service unlike the traditional providers.
 

bushido

Suspended
Mar 26, 2008
8,070
2,754
Germany
i've yet to successfully search for the answer to this: is HBO NOW a full HBO catalog above and beyond GO? i've seen most HBO shows so i wouldn't get much value there, and the A-Z movie listings on GO are kinda paltry.
its the same catalogue in fact I have yet to find anything that I haven't already seen lol
 

teslo

macrumors 6502a
Jun 9, 2014
928
598
its the same catalogue in fact I have yet to find anything that I haven't already seen lol
thats.. really not a tempting offer for anyone who has had HBO in the recent past, mooches an HBO GO account, or has Netflix and a handful of streaming URLs.
 

Gasu E.

macrumors 601
Mar 20, 2004
4,621
2,629
Not far from Boston, MA.
i've yet to successfully search for the answer to this: is HBO NOW a full HBO catalog above and beyond GO? i've seen most HBO shows so i wouldn't get much value there, and the A-Z movie listings on GO are kinda paltry.
Since you can subscribe to HBO NOW by the month, I can well imagine many users choosing to subscribe to NOW for 1-2 months only and binge-watch recent exclusive content.
 

bbeagle

macrumors 68040
Oct 19, 2010
3,406
2,665
Buffalo, NY
wow! How the hell they got HBO on board with those margins is shocking.
The article states that cable companies take 50%, not just 15-30%. Apple is giving HBO a big discount to what it is used to

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Since you can subscribe to HBO NOW by the month, I can well imagine many users choosing to subscribe to NOW for 1-2 months only and binge-watch recent exclusive content.
Exactly what people with cable or satellite can do now
 

FrizzleFryBen

macrumors 6502
Dec 14, 2009
401
6
Charlotte, NC
When you are able to create a closed ecosystem with a near cult following, you get pay-to-play. It's nothing new and nothing out of the ordinary. The key factor is that consumers are choosing to join the ecosystem. Apple deserves their just rewards for that
 

rohitp

macrumors regular
Oct 9, 2003
156
25
Austin, Texas
TV via internet?

Let me state up front that I have cut the cord myself. Get my broadcast stations OTA here in Austin and have Netflix/Hulu Plus. Got rid of a big monthly TWC bill.

HOWEVER... this is not a model that can work. Each and every customer receiving streaming video adds to bandwidth demands. That is NOT the case with Cable TV - only one signal goes out over the network regardless of how many people are tuned in. But for internet streaming, each stream is unique and demands bandwidth.

Do that math... that simply does not work out if enough people "cut the cord." What we'll find in the end is that either these prices have to rise for the infrastructure to keep pace or cable TV prices will drop or go a-la-carte.
 

JonneyGee

macrumors 6502
Jun 8, 2011
348
1,208
Nashville, TN
Two requests from Apple and I'm sold:
1. Make the channels a la carte and not a package.
2. Get ESPN and Fox Sports on board.

Can't wait for some good news at WWDC!
 

Anonymous Freak

macrumors 603
Dec 12, 2002
5,250
603
Cascadia
Interesting.

When I signed up, I tried on my AppleTV, but the sign-up page for AppleTV was apparently having problems, so I gave up and signed up through the iPhone app instead. Does this mean HBO just lost out on $2.25/month (and Apple gained $2.25/month)?
 

ArtOfWarfare

macrumors G3
Nov 26, 2007
8,845
4,622
Whether Apple is charging 15 percent or 30 percent a month, it's giving distributors a much better deal than the 50 percent that pay TV providers usually charge premium networks like HBO. That makes the platform even more enticing to cable channels that are thinking about stepping outside of the traditional pay TV bundle -- and it puts more pressure on the cable guys to sweeten the deals they already offer."
Here's hoping that the increased margins for the distributors means lower cost for us, the consumers.
 

BruiserB

macrumors 68000
Aug 9, 2008
1,561
434
Interesting.

When I signed up, I tried on my AppleTV, but the sign-up page for AppleTV was apparently having problems, so I gave up and signed up through the iPhone app instead. Does this mean HBO just lost out on $2.25/month (and Apple gained $2.25/month)?
I'm guessing that all signups through iTunes billing pay Apple 15%, no matter what the device is. The original post isn't very clear on this.
 

ArtOfWarfare

macrumors G3
Nov 26, 2007
8,845
4,622
Make the channels a la carte and not a package.
I'm okay with a package so long as the package isn't full of crap I don't want.

Some kind of Build Your Own Package, where you can buy 1 channel of your choice for $10/month or 10 channels, each of your choice, for $60/month, would be pretty sweet. (I'm just making numbers up, but you get my point. More channels = lower cost per channel.)
 

justmewhoelse

macrumors newbie
Apr 1, 2015
26
25
Sure. Anyone can charge what they think market will pay them. All for it.

I cut cord over five years ago. With two teens at the time blessing (TV Sucks they said) Saving $104 per month on cable TV. When I was using original AppleTV's at the time. Now on 3rd generation of them. Netflix we use a lot. So much available on the internet too, which we can just airplay to AppleTV on big screen.

But if the "cord cutters" are going to end up paying $15 per month ala carte - paying a cable company starts to make sense. HBO Go - $15, Sling $20 per - etc…

Not sure the the best way… but I would pay say $1.99 per month for a news channel - CNN or a Fox News. HBO charging $1.99 or whatever per episode go Game of Thrones only etc… I think people would pay for that true choice. And I image we will get to something like that in a couple of years. But if HBO, Fox, CNN are going to bundle channels - cable companies just might not have much to worry about.



When you are able to create a closed ecosystem with a near cult following, you get pay-to-play. It's nothing new and nothing out of the ordinary. The key factor is that consumers are choosing to join the ecosystem. Apple deserves their just rewards for that
 

Staindsoul

macrumors 6502
Apr 13, 2010
382
31
Texas
Just no worth 15 per month. HBO is nuts.
When Game of Thrones is on, $15 for HBO is well worth it! A close second is True Detective. That is 50 cents a day to watch those shows and the entire HBO catalog.

To me this is a huge bargain. To each their own.
 
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