Apple could become a cable company

The tech giant has apparently been speaking directly to production companies about content.

By Benzinga Aug 23, 2013 2:21PM
copyright Digital Vision Ltd., SuperStockBy Tim Parker

Another day, another threat to the cable companies.


Tuesday's Apple (AAPL) rumor mill produced an interesting idea where Apple could move forward with its TV plans by essentially forming its own cable company.


The fact that Apple is interested in the TV space is nothing new. Steve Jobs spent years trying to "crack the code" of the television experience -- something that has barely changed in generations.


Now-CEO Tim Cook said that the company is interested in the idea, and there's no absence of rumors that would lead Apple-watchers to believe that there are concepts already in place where Apple becomes the controller of all facets of a person's TV experience.


What has kept this iVision from moving forward is content. Cable companies, desperate to keep content funneling through their infrastructure, don't want Apple doing to them what it did with music.


But now, Apple may have a new strategy when it comes to cable companies: If you can't negotiate with them, bypass them altogether.


According to multiple sources including Reuters, Apple is negotiating directly with production studios to bring that content directly to TV. This makes Apple, in effect, its own cable company directly competing with Time Warner Cable (TWC), Verizon (VZ) and even DirecTV (DTV).


Apple has apparently spoken to Disney's (DIS) ESPN, Time Warner's (TWX) HBO, and Viacom (VIA) who owns Comedy Central, MTV Networks, and Nickelodeon.


Those who would acknowledge that talks had taken place cautioned that talking is far from any kind of deal and most indicated that, at least for now, the way their content was delivered to customers wasn't going to change.


What's clear is that production studios are finding their content is in higher demand from more players than ever. Not only does Apple want to move TV to an a la carte, internet-based delivery platform, Intel (INTC), Google (GOOG) and Sony (SNE) all have grand plans (appleinsider.com) that would change the cable TV model that consumers are increasingly hating. 


Thursday, we reported that Google was talking to the NFL about bidding for the rights to its Sunday Ticket package that would bring out of market games to YouTube.


Apple believes that the iTV could launch without every studio on board. All it needs are one or two big players and the rest will eventually fall into place.


Disclosure: At the time of this writing, Tim Parker was long Apple.


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16Comments
Aug 23, 2013 3:56PM
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The cable TV model is broken.  You have 100's of channels but I can only select from 3 packages.  WTH?  That's like going to a buffet and not being able to select what individual items you want to eat but only what size plate they are going to sell you.  If you want the apple pie you have to purchase all the other junk on the buffet even if you don't like it.  Somebody please blow up this model and bring us something better.   
Aug 23, 2013 4:29PM
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If Apple can bring forth per channel choice, I am all for it as opposed to the, as one posters noted, you go to the buffet, but they pick what you can really eat. It's really getting old to pay for hundreds of channels when only a couple are even worth watching.
Aug 23, 2013 3:37PM
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People generally utilize HD Antenna and Netflix, Hulu, etc. to watch a la carte currently if they are within range of metro area HD signal.  There is definitely a market that could emerge from current television trends.  
Aug 25, 2013 2:23AM
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As long as I could get rid of Comcast I would be delighted.
Aug 23, 2013 3:54PM
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And just like their over-hyped phones, every 6 months they will release a new programming package that will get the drones to line up for days just to pay more for the same crap they have now.  lol
Aug 23, 2013 3:33PM
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Gee, if all you need is a content selector device and an internet connection why do you need Apple?
Aug 23, 2013 9:41PM
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This is what we need.  I hope it will happen.

Aug 25, 2013 8:26PM
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Apple could become Dell after everyone switches to Lenovo and Samsung.
Aug 23, 2013 5:49PM
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Whatever. As long as it makes tons of money and the stock does 20% a year. That's all I care about.
Aug 25, 2013 6:32PM
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The concept of iTune should be applied to TV as well, hopefully Apple would be able to offer for users in the near future.
Aug 23, 2013 5:33PM
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Apple should just stick to selling to fruits.  Now that everyone who ever wanted one has one where to now?  So the Street view is you should gamble on this hired employee Cook to match up with the late Jobs even though we all know he is an imposter.  Oh yea here's my money now I'll keep my fingers crossed.  That is the dimmer view of investing. 
Aug 23, 2013 3:37PM
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At the rate we're going... people won't be able to afford cable either. Maybe Apple should dump all the lame ideas and just start hiring people so they can afford to buy what they make.
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