Apple TV-Service Proposal Gets Some Nibbles

Discussion in 'Apple TV and Home Theater' started by fieldy au, Dec 21, 2009.

  1. fieldy au macrumors member

    Jan 12, 2009
    Could be interesting!

    Apple TV-Service Proposal Gets Some Nibbles
    By Sam Schechner And Yukari Iwatani Kane
    1133 Words
    22 December 2009
    00:16 GMT
    The Wall Street Journal (Online and Print)
    The Wall Street Journal - Print and Online
    Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved.
    CBS Corp. and Walt Disney Co. are considering participating in Apple Inc.'s plan to offer television-show subscriptions over the Internet, according to people familiar with the matter, as Apple prepares a potential new competitor to cable and satellite TV.
    The proposed service by the maker of iPhones and iPod music players could, in at least some scenarios, offer access to some TV shows from a selection of major U.S. television networks for a monthly fee, according to people familiar with the discussions. Apple is pushing to complete licensing deals and hopes to introduce the service in 2010, some of those people said. It is unclear whether any networks have signed on yet.
    Spokespeople for Apple, CBS and Disney declined to comment.
    If Apple signs up enough networks to launch a viable service—still a very big if—it could ultimately alter the economics of the television business. The service could undermine the big bundles of channels that cable, satellite and telecommunications companies, including Comcast Corp. and DirecTV Inc., have traditionally sold in packages to subscribers.
    Comcast declined to comment. A spokesman for DirecTV said, "It's difficult to gauge how competitive they will be without seeing the packaging, presentation and execution."
    The video strategy is part of Apple's plan to overhaul its iTunes store. The store currently sells downloadable music, video and applications like games, entertainment and productivity tools for its touchscreen devices, like the iPhone and iPod Touch. Apple recently said it was buying music-streaming service La La Media Inc. as part of its plan to offer consumers more ways to access and manage their music purchases. Similarly, the TV subscription service would be in addition to the way Apple sells individual TV shows.
    Apple is revamping iTunes as it finalizes its plans for a tablet device, which is meant to be a multimedia gadget, according to people briefed about the product. The multimedia tablet is expected to be larger than an iPhone but smaller than a laptop computer. People briefed by Apple say the company is aiming to launch it by the end of March.
    Apple faces an uphill battle assembling a critical mass of TV networks to sign up, a factor that could delay or scuttle a launch. A broad swath of media companies—including News Corp., Viacom Inc., Time Warner's Turner Broadcasting and Discovery Communications Inc.—appear to be opposed to or leaning away from signing on, at least to Apple's initial proposals, according to people familiar with the matter. It is unclear if NBC Universal, in which Comcast is buying a controlling stake, is interested.
    As part of the Apple service, CBS is considering offering programs from both the CBS and CW networks, according to people familiar with the matter. CW, a joint venture between CBS and Time Warner Inc.'s Warner Bros., airs shows like "Gossip Girl" and "Vampire Diaries" that are among the most popular purchases, per episode, on the iTunes video and music bazaar.
    Disney is considering including programs from its ABC, Disney Channel and ABC Family networks, according to a person familiar with the matter. Disney has in the past been among the first to jump into online video, including on iTunes. Apple Chief Executive Steve Jobs is Disney's largest individual shareholder and sits on the company's board.
    In at least some versions of the proposal, Apple would pay media companies about $2 to $4 a month per subscriber for a broadcast network like CBS or ABC, and about $1 to $2 a month per subscriber for a basic-cable network, people familiar with the proposals said. Those amounts are in some cases much higher than media companies receive from traditional distributors. The question is whether selling fewer networks at higher prices is better business.
    Apple's TV proposal may be changing as the company woos networks, according to people familiar with the matter. An initial version of the proposal had envisioned selling access to advertising-free shows from a bundle of top cable and broadcast networks—the "best of television"—with a consumer price tag of $30 a month, according to people familiar with the talks.
    Some media companies say the proposed Apple service could undermine the lucrative business of selling bundles of big and small cable networks to distributors like Comcast and Time Warner Cable Inc. That concern is less central to CBS, which owns few cable networks. But for companies with large cable-network portfolios, selling only some of those channels to Apple, even at inflated prices, could cut into revenue.
    Some executives are also concerned that the Apple service wouldn't include advertising, at least in some of Apple's proposals. U.S. broadcast and cable networks sold $43.4 billion in ads in 2008, according to TNS Media Intelligence.
    "You don't want to shoot a hole in the bucket to create another revenue stream," one media executive said.
    It is also unclear how many shows from each network could be made available through the Apple service. Networks' rights to TV shows online are snarled in a tangle of licenses with the studios that produce them. It is possible some shows produced by outside studios for a network could end up left out of an Apple offering, according to people familiar with the discussions.
    Apple's initial proposals were reported in November by the Web site All Things Digital, which like The Wall Street Journal is owned by News Corp.
    Even if Apple is able to launch the new service, it faces a good deal of competition. Movie rental company Netflix Inc. is expanding its customer base for its streaming video servicethrough partnerships with consumer electronics manufacturers and videogame console makers such as Microsoft Corp. and Sony Corp. Video site Hulu, which offers TV shows from several networks over the Web, is also looking at the possibility of launching a subscription service. Hulu, which is owned by News Corp., NBC Universal and Disney, has become the second-most popular destination for online video, after Google Inc.'s YouTube, with 657 million video streams in November, according to Nielsen Co.
    Meanwhile, cable companies are rolling out their own services that put cable-TV shows online for existing subscribers, giving them more reasons to keep their subscriptions. Comcast brought out its system nationwide on Dec. 15, offering its subscribers online access to some programs from 27 cable networks. Time Warner Cable and Verizon Communications Inc. are testing similar offerings.
    According to Adams Media Research, Internet spending on movies and TV shows is expected to more than double to $1.14 billion in 2010 from $472 million in 2008.
    Sarah McBride and Ethan Smith contributed to this article.

    Interesting stuff
  2. godslabrat macrumors 6502

    Aug 19, 2007
    I'm curious. If this could provide ALL of my weekly shows, plus my NCAA football games, and those godawful reality shows enjoyed by some members of this household... I'd consider it.

    OTOH, I live in Oklahoma, and do depend on the TV for severe weather updates... :(
  3. mstrze macrumors 68000

    Nov 6, 2009
    And you can't get those updates over-the-air with an antenna?

    We have been without cable/sat for 4 months now and it's AWESOME not having to spend 90 bucks a month.

    I would love this subcription service. But even now, we bought a few seasons of favorite shows for a one-time cost of $120 and we made up that cost 2 months ago.

    I Love AppleTV right now, but THIS would make it an ultimate service for my household. We couldn't care less about sports so that is meaningless to us...I know it's impportant to a lot of people and that's why some people can't cut themselves from the wire.
  4. reebzor macrumors 6502a


    Jul 18, 2008
    Philadelphia, PA
    of course comcast declined to comment. I would have really liked to hear what they had to say considering their purchase of NBC involves the only 2 TV shows I watch on a regular basis (Office, 30 Rock).
  5. rotlex macrumors 6502a

    May 1, 2003
    Should this come to fruition, I would be very, very interested as well. I currently pay over $100 per month for cable, and watch maybe a half dozen channels. Unfortunately, a number of those channels are out of range of the "basic" cable package.

    I've been seriously considering dropping cable anyway, and just buying anything I watch off of iTunes. Heck, a whole years worth of stuff would cost me MAYBE 3 months of cable cost, if that. If a subscription service came in at even half the cost of what I pay now, and would let me watch the shows I currently watch, I'd do it in a heart beat.
  6. godslabrat macrumors 6502

    Aug 19, 2007
    I hear enough mixed reports about ota dtv reception in my area that I'm just not sure I want to chance it, least of all in a crisis. Radio updates are okay, but I want to be able to turn on the tube and instantly see where the storm is.

    Still, even if it doesn't pan out right away, it'd be a nice idea to look into if I move.
  7. mstrze macrumors 68000

    Nov 6, 2009
    Get a Terk antenna...or if you own your home, get a rooftop one.

    A nice bonus is that you will probably have 2 or 3 local purely weather channels to watch too that you may or may not have had easy access to on cable.
  8. AkronElliott macrumors member

    Dec 18, 2009
    Couldn't you get weather alerts via a email notification or web-service?

    I do not know if there is an iPhone app for that or not. Would be a good thing since the iPhone would know your location. Have a ring tone for weather notifications then browse to the weather channel's local radar?

    Perhaps have email notifications via weather channel and have the mail app send notification through growl to you?

    These could be in addition to your tv coverage, if you wanted to test it out for validity first.
  9. mstrze macrumors 68000

    Nov 6, 2009
    I know that something like this is available from the Lawton/Wichita Falls-area statins and I would be shocked if OKC and Tulsa didn't offer the same. They are all RABID with weather coverage they need to be during tornado season.
  10. HobeSoundDarryl macrumors 604


    Feb 8, 2004
    Hobe Sound, FL (20 miles north of Palm Beach)
    OTA tends to be the most likely source of television following a major storm. Cable/Satt can go down much easier than OTA, and if your Internet comes through that same cable/satt, it goes down when they are down. We've been through the eyes of 3 hurricanes in one season, losing everything signal-wise except OTA. Why? Because it does not depend on a wire for transport of the signals. IMO, the ideal would be OTA, then Satt (which often involves re-aligning a dish at worst after a storm), then cable (which often involves waiting on your cable supplier to reconnect lines damaged by falling limbs, etc). If you get your internet via DSL (which is phone line), then the ideal is probably a toss up between OTA and DSL, then the other, then Satt, and then cable.

    In the eyes of those hurricanes- for the brief period that everything is dead calm- cable was out, satt was out, internet was out, electric was out, but using a battery backup for the TV linked to an OTA antenna, we were able to get all of the news (including seeing those eyes sitting over our place). After the storm, satt came back up quickly, but cable and (our) internet (through cable) did not come back for many days.

    Give it a chance. As a bonus, none of the other options offer a better (less compressed) HDTV signal for local network channels.
  11. godslabrat macrumors 6502

    Aug 19, 2007
    NOAA has a pretty slick one. I haven't had to test it under bad conditions, but it gives tons of data.

    That may be so, but I've heard lots of people unable to get great reception in good weather with OTA. Unless, of course, they get a great outdoor antenna, which I was strongly considering until I calculated the hassle involved in setting one up on the roof of a rented house.

    Unrelated thought: If Apple does want to position themselves as an alternative to CableTV, are they going to need to relax their standards on adult content distributed on iTunes? There needs to be some answer to the PPV services offered by CableTV companies, even if Apple doesn't want to play ball in that court.

    In any event, I'm still wanting to keep an eye on this. If they can offer everything I want for 50% or less than my current monthly rate, I'll consider switching.
  12. AkronElliott macrumors member

    Dec 18, 2009
    Good thought, my question on that would be the distribution of data into the house. Satellite? Cellular? wired connections are owned by phone and cable companies.

    Since we can now transmit data on power lines. I do hope that the electrical outlet would be a new delivery option soon.

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