Apple's 'Hard-Nosed' Negotiating Tactics Leading to Trouble in Television Market

[Rogifan]

It's pretty disrespectful for Eddy Cue to show up 10 minutes late dressed in jeans and sneakers with no socks and then make very aggressive demands. Comes across as completely arrogant. No wonder Time Warner said screw you. Would Tim Cook have shown up at a similar meeting in jeans and an untucked shirt? My guess is not. Someone needs to tell Eddy to quit dressing like a slob.

 

[maxsix]

TV companies saw Apple destroy profits in the music market, which in turn led to the death of music itself, and they don't want the same thing to happen to them.

Apple's arrogant narcissism has clouded their ability to see clearly. Instead of focusing on what they're good at, they assume they're the best at everything.

Their second rate services like iCloud and Apple Music, bad apps like Apple Maps, demonstrate the company's greatest weaknesses.

Resting on their laurels, spending the last three years profit taking off iOS devices, Apple has thumbed their nose at customers and competition alike. To add salt to the wound, their coasting through this year as well.

Samsung Galaxy S7 / S7 Edge is dominating customers mind share and setting a stellar example for Apple to follow. If not for their massive war chest of cash, Apple would be forced to get back to work.

Next year they'll be counting on iPhone 8... But after they've shot their wad, things will get extremely interesting.

 

[Tech198]

I doubt its Apple's fault.. Networks just won't budge from the year old 90's.

kinda ironic, when u think HBO has no problem doing a "standalone" HBO Now web based service... Perhaps they only did that because they are still tired to cable companies which would get most of the revenue...

Then again,u could say the same about any network couldn't u...... So, knowing this, there actually is no reason to hold back. Forcing to do "Apple only highlights" could be good, but its the same reason why i refuse to watch "Netflix's own productions" for the same reason..

Its not exactly hollywood style. not that its bad.... but its not exactly blown away either

 

[44267547]

"Cue, who leads most of the deals, is known for his "hard-nosed" negotiating style and refuses to settle for less than what Apple wants."

More like his hard head in my opinion.

 

[MH01]

There's no tragedy here. If Apple can't get a significantly different deal for content than what's come before, there's no chance it will be significantly better either.

Ultimately, we consumers lose nothing if they can't get a deal done but might gain something if they can.

And if the price goes up?

 

[noisycats]

Swallow the pride and margins, just a bit and just for short term, pull them in. Everyone. It truly is becoming all about the ecosystem. Once you have them in, both content providers and customers, they are remarkably hesitant to leave. Proven time and time again.

 

[Tech198]

"Cue, who leads most of the deals, is known for his "hard-nosed" negotiating style and refuses to settle for less than what Apple wants."

More like his hard head in my opinion.

hehe......

 

[Abazigal]

Eh, Apple can afford to wait and play the waiting game. Just like I don't mind waiting for as long as it takes for Apple to wrangle the best deals possible.

Just don't complain when Apple does go into streaming like what they did with Apple Music.

 

[canesalato]

I would love to have you on the other side of the negotiating table from me. I'd have you wetting your pants in 10 mins

Keyboard lion

 

[niun]

I would love to have you on the other side of the negotiating table from me. I'd have you wetting your pants in 10 mins

You must have some excellent jokes.

 

[Ghost31]

I got tired of waiting for Apple and tried Sony PlayStation Vue on my PS4. It's been a very pleasant surprise. Works very well over FIOS, get all the local channels in NYC, and unlimited cloud DVR for 28 days.

The interface is good (for Sony) and has been improving. There are three tiers, and the basic one has what I want without too much filler. My only real complaint is that they don't have an App for Sony's own Android TVs.

I'd recommend people use the free trial to see if it works for them.

Ps Vue is the most surprisingly good thing I've tried in quite awhile. I didn't expect it to work out so well. And the fact that I can use ps Vue to login into tv networks like it has the same credentials as having regular cable is icing on the cake. I just wish there was a damn app on Apple TV so I didn't have to boot up my ps4 every single time

 

[2010mini]

Do you really think that's a good thing? If complain that prices are high now, what do you think would happen if Apple owned massive amounts of content?

I'll give you a hint. The Apple Tax you pay for everything would be slapped onto entertainment. You'd trade a middle man you hate for a middle man you like- but expects industry leading profits on everything they touch.

Some of you need to think like a consumer instead of thinking what's good for Apple is good for you.

I actually don't complain about pay tv prices. I have an understanding of just how expensive tv/movie content is to make and distribute. So, to me, the price is fair. My complaint has always been the horrid pay tv equipment, UI and customer service. These three things are where pay tv providers fail. This is where Apple, Google, Roku etc can excel. Imagine if you had the choice of equipment with a UI you preferred to use?

 

[5097842]

Ps Vue is the most surprisingly good thing I've tried in quite awhile. I didn't expect it to work out so well. And the fact that I can use ps Vue to login into tv networks like it has the same credentials as having regular cable is icing on the cake. I just wish there was a damn app on Apple TV so I didn't have to boot up my ps4 every single time

The PS Vue app situation puzzles me. They have an iOS app, but not one for AppleTV. They have an Android app, but not one for Sony's own Antroid TVs. But they do support Roku and FireTV boxes. Maybe they'll get around to developing the other apps sometime soon.

I still don't get why Apple can't at least copy what Sony has done with PS Vue. It's a compelling service that would be made even better with Apple's hardware and UI.

 

[2010mini]

Sound like Eddy Cue should be known as Eddy 'No' Clue.

Apple should use the Apple TV as a loss leader and either give it away free or for $49 with every Mac/iphone/ipad purchase.
Get it into the hands of 100 million or more houses.
Then they would have leverage over these cable companies.

The cable companies seem to have the worst business models. "We don't want to unbundle our channels as this 1 good channel makes it possible for use to produce and pay for rubbish shows for another 15 other channels."

What other business works like that?
If it were products for example, a company would look at their product lines and say this 1 is making most of the profit, and those 15 are tanking and costing us money. Ok lets scrap that junk and make the good one better...

It's not the cable companies that don't want to unbundle. It is the networks/studios that force bundles on cable companies. The current model is very lucrative and as such there is no incentive for them to change. Apple could lead the world with streaming box sales and it still wouldn't mean a thing to the networks/studios. Why? Because they own the content we all want to watch.

 

[maflynn]

I'm late to the party, but all I can say is that cable companies, networks and studios have the power, if they don't like Apple's terms then they can just push back. Apple was more pliable back in the day with first negotiating deals with music labels, only when they were a force in that market they could be more "assertive" With the increased competition and popularity of the competition. Apple is no position to play hardball imo.

 

[mantan]

I actually don't complain about pay tv prices. I have an understanding of just how expensive tv/movie content is to make and distribute. So, to me, the price is fair. My complaint has always been the horrid pay tv equipment, UI and customer service. These three things are where pay tv providers fail. This is where Apple, Google, Roku etc can excel. Imagine if you had the choice of equipment with a UI you preferred to use?

Like you, I don't have a problem with the cost - as I understand the economics of the bundle system and how it's resulted in a golden age of television programming (and sports coverage!)

I have DirecTV and have been satisfied with the customer service. I've had one significant technical issue in 15 years that took a couple of visits to fix. But they do a great job of continually upgrading their equipment, features and amenties. Whether it was releasing DVRs before most cable companies, whole home DVR, wireless, streaming features of the tablet a high quality app...they've done a great job.

And most of all 'it just works'. I've played around with alternate delivery systems - Roku, Amazon TV, Fire Stick, etc - but they all suffer from an a clunky interface. Any alternative has to meet the 'grandma' theory. If the parents or inlaws are visiting or we have company - can they operate the TV without me having to explain different menus/remotes. Until something gets to that system and still has the depth of programming and sports as the current system, I'll keep what I have.

 

[RickInHouston]

The only reason why cable still has the negotiating powers because of you guys, if you still have cable in your home I'm talking to you. I gave up my cable for almost ten years now, it's your turn to do your part. Obviously they're just milking at you big time, because you're paying for the service and watching those commercials too at the same time. I just don't know how people fall on this trap and not realizing that we're just feeding these monsters. It's time for us to make sacrifices if you want change.

When internet providers see the scales turn to internet provider dependence, then they will be the ones inside your back pocket. Just swirching one for another.

 

[mantan]

I doubt its Apple's fault.. Networks just won't budge from the year old 90's.

kinda ironic, when u think HBO has no problem doing a "standalone" HBO Now web based service... Perhaps they only did that because they are still tired to cable companies which would get most of the revenue...

Then again,u could say the same about any network couldn't u...... So, knowing this, there actually is no reason to hold back. Forcing to do "Apple only highlights" could be good, but its the same reason why i refuse to watch "Netflix's own productions" for the same reason..

Its not exactly hollywood style. not that its bad.... but its not exactly blown away either

Cable companies weren't getting most of HBO's revenue...they were just a distribution medium. The 'advantage' for HBO is they got a gateway to millions of homes who could opt to buy there service. The revenue for the cable company was on cable boxes, equipment and fees.

HBO is one of the few networks that's build a brand following large enough to establish their own streaming wireless medium that people are willing to pay for. To that extent, it was a pretty easy decision for them. But there aren't a lot of HBOs out there.

 

[2010mini]

Like you, I don't have a problem with the cost - as I understand the economics of the bundle system and how it's resulted in a golden age of television programming (and sports coverage!)

I have DirecTV and have been satisfied with the customer service. I've had one significant technical issue in 15 years that took a couple of visits to fix. But they do a great job of continually upgrading their equipment, features and amenties. Whether it was releasing DVRs before most cable companies, whole home DVR, wireless, streaming features of the tablet a high quality app...they've done a great job.

And most of all 'it just works'. I've played around with alternate delivery systems - Roku, Amazon TV, Fire Stick, etc - but they all suffer from an a clunky interface. Any alternative has to meet the 'grandma' theory. If the parents or inlaws are visiting or we have company - can they operate the TV without me having to explain different menus/remotes. Until something gets to that system and still has the depth of programming and sports as the current system, I'll keep what I have.

Thanks. I too agree with your statement about directTV. But unfortunately the lionshare of pay tv equipment and UI sucks. The best one I saw was the streaming box available to TWC users from FanTV.

http://www.theverge.com/2013/5/30/4380108/fantv-set-top-box-fanhattan

But TWC did their best to hide it from their own customers. I couldn't find it on third website when it was available. Shame.

 

[147798]

Music was the first media industry to be ravaged by digital, high quality reproduction ala Napster. The media giants have learned much since then.

In the late 00s/early 10s, Apple could be arrogant because they were pumping out amazing, next gen products that everyone wanted.

"give us everything we want in TV because we make pretty watch bands" -- yeah, not working so well.

 

[DevNull0]

There's no tragedy here. If Apple can't get a significantly different deal for content than what's come before, there's no chance it will be significantly better either.

Ultimately, we consumers lose nothing if they can't get a deal done but might gain something if they can.

Really? What has Apple ever done that makes you think if they get a significantly better deal, they will pass it onto customers?

The entire history of the company says they will pocket the entire benefit they negotiate and on top of that mark it up a bit more because Apple is worth the extra cost.

 

[flaw600]

Apparently Cook and Cue don't share the same "je ne sais quoi" as Steve Jobs. (But, we all knew that already.)

Jobs was hard-nosed as well in negotiations.
[doublepost=1469804281][/doublepost]

No... When Jobs brought music labels on board to iTunes the music industry was in a shambles, and the labels would have jumped at anything. They needed Apple. Afterwards, many music execs felt that they were played, ceeding too much to Apple.

It's a much different dynamic today with far more opportunities for content providers, and, with execs remembering how much Aplle got away with in the past with music. Different times. Jobs would not have the leverage today that he had with iTunes.

Exactly. This something that Jobs himself implied many times, particularly in his biography.
[doublepost=1469804399][/doublepost]

I don't blame you... Bending over to Taylor Swift publicly? Jerking that clown Jimmy Iovine off and blowing 3 billion dollars on Dr. Dre? I could keep going, bluntly put he's tarnishing the Apple brand.

And yet Apple Music is the second-largest streaming service behind Spotify - and growing. Yeah, such a disaster. Hate Cue all you want but he's done his job well and tbh until Phil took over the App Store he really was saddled with too much.
[doublepost=1469804468][/doublepost]

Netflix original content is very compelling and interesting. The proposed shows from Apple are...not.

Because they're not trying to compete with cable, unlike Netflix. Btw, the Netflix experiment seems to be shaky these days. Their library has shrunk considerably and growth is stalling.

 

[DevNull0]

Jobs was hard-nosed as well in negotiations.

Jobs got the deals done. And Apple benefited big time. I guess you don't know what the OP meant by "je ne sais quoi"?

 

[flaw600]

I'm very curious to see if the Apple TV as a platform ever becomes so big that Apple can get these tactics work again. I don't really think that it will. Si ce there are so many competitors (Fire TV, Roku, Chromecast), they should've priced it at $99/$149 for the 32GB/64GB version, not at $149/$199. It's too expensive. If their goal is to reach as many homes as they can, they are doing it wrong at the moment. Maybe we see a price drop in October? Would be nice!

Why do people keep thinking that cheaper is the answer? Apple has had extraordinary success at not being cheap. Oh, and those that buy Fire TVs, Rokus, and Casts are cheap people who don't spend much money on the services those devices deliver. So Apple might not sell as many devices, but they still have the paying customers.
[doublepost=1469804728][/doublepost]

Jobs would have, IMHO, wrapped up the tv/video space years ago. Cook and Cue fumbling around for years has allowed the competition to gain footing and has cost Apple the leverage advantage you reference.

You realize years ago is '11? And Jobs already had allowed competition to gain footing. Apple has never cared about marketshare.
[doublepost=1469804925][/doublepost]

"Bigger" than Facebook - in what way?

People forget that even Apple's smaller parts are actually really big when compared to the industry. Apple's services are slated to be a Fortune 100 company by next year.
[doublepost=1469805024][/doublepost]

Another product (AppleTV) that missed the "insanely great" target. Instead it is a mediocre dumbed down PC with way to many unnecessary limitations. It seems so stupid to be holding back 4k for the big media announcement when no one is going to care because choices have already been made.

You mean to deliver the practically non-existent heavily compressed 4K that very few can actually get delivered? Right...
[doublepost=1469805186][/doublepost]

I completely agree with you about the lack of purpose and functionality on the highly talented new Apple TV. However to see that you were satisfied with cable is interesting as well. always on yes but always expensive as well The majority of it being content that I could care less about.

I'm actually satisfied with cable's content, just not their delivery. Their pricing is really the only feasible one. Cheap a la carte pricing is never going to happen. People also blame the cable companies for high prices when it's really content owners (ABC, CBS, etc.) that are causing the high prices.

 

[ncollingridge]

Any alternative has to meet the 'grandma' theory. If the parents or inlaws are visiting or we have company - can they operate the TV without me having to explain different menus/remotes. Until something gets to that system and still has the depth of programming and sports as the current system, I'll keep what I have.

Absolutely crucial. I agree entirely. Apple used to be good at this stuff but they have seriously dropped the ball with TV. They need to be an integrator without equal here, accepting the role of other program sources including (for the time being) blu-ray etc and making it all much easier to use than the competition. Then they might start to gain some traction, but as it is they are pretty much dead in the water as far as I can see in terms of gaining any appreciable market share.

Here in the UK, Sky is a seriously good example of a company that has put a lot of effort into how to present this stuff to the end user in a way that even grannies (and grandpas!) can handle without much problem. And they keep on evolving the service and the hardware without waiting for their competitors to catch up. Apple are way behind where Sky are now and even though I have an AppleTV I must admit i never use it because it just is not as compelling (or even useful) a solution.