A new report places Apple in discussions with large cable operators to possibly pipe their content through Apple TV or a similar set-top device. If accurate, such an arrangement would not only raise Apple’s profile in the television market, but could also greatly affect the nature of content coming to your TV screen - and how it gets there.
It’s no secret that Apple wants to be a big presence in your living room. The $99 Apple TV set top box - and its associated technologies like AirPlay - are evidence of that. But now the Wall Street Journal is reporting that Apple is working to negotiate a deal with cable providers that might enable live cable TV content to be viewed on Apple TV.
Apple Pivots to a New Plan
These negotitaions may indicate that Apple has not been terribly successful in its original goal to license content directly from television and movie producers. That plan followed the cable-cutter model: give consumers enough content and they’ll replace their existing cable service with Apple’s Internet-based offerings. Google and Amazon have similar ambitions, with Google TV and Amazon Digital Services showing up on devices like the Vizio Co-Star and the Roku, set-top boxes, respectively.
If Apple can cut a deal with the cable providers, it would avoid this disruptive model altogether. Instead, Apple could insinuate an Apple TV-like device into the current supply chain from content producer to cable provider to consumer.
What Can Apple Offer?
It won’t be easy. Other than hooking on to the Apple “cool” factor, there seems little incentive for cable companies to make such a deal. After all, most cable set-top boxes already use a Linux-based operating system layer (which is pretty much free) so why pay more for an operating system licensed from Apple? And, more importantly, cable companies already have the video content. What can Apple offer that they don’t?
Well, these three things for starters:
1. Music, for one. Apple has well and truly locked up deals with the recording industry, and on-demand music coupled with the capability to play a user’s songs over a home theater system would be a nice plus. For now, most cable and satellite services offer only streaming music channels, often from Sirius/XM.
2. Internet content for another. Apple TV doesn’t currently have a Web browser, but a new for-cable Apple device could. For all their investment in TV browsing and DVR interfaces, that’s something that the cable companies don’t really have. Browsers are already showing up within set-top devices: the aforementioned Co-Star features Google’s Chrome browser.
3. Apps could be the key to Apple’s appeal to the cable companies. Roku and other set-tops already feature some gaming apps, and cable companies may want to get in on the act. The few efforts made by the cable providers in this area have been, frankly, sad. Apple could bring an instant gateway to millions of high-quality iOS apps.
There’s no telling how far along Apple’s talks with the cable companies have gotten, or if any such deal will come to fruition. But of all the players in this space, Apple is in perhaps the best position to deliver the most music and apps right now.
That pre-eminent position may erode as Google Play and Android application development grows, so Apple may be trying to strike while the iron is hot to get a first-to-cable-market jump on its online competitors.
For more on the ongoing evolution of television, see What’s At Stake In the Epic Battle Between TV Networks and Cable/Satellite Providers.
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