Apple has long been rumored to be working on a television subscription service of its own to offer on the Apple TV, however in a recent report by Re/Code, it was revealed that these talks have fallen through because of the fact that Apple was pushing to offer a “skinny” service that would be priced at less than $30 per month.
Basically, everyone’s assumptions were correct – the big wigs at TV networks weren’t happy with how much Apple wanted to pay them – a situation that has echoed through Apple’s history, especially when it comes to the music industry.
Of course, the beef that the TV industry has with Apple is pretty complex, and one that likely wouldn’t be fully understood unless we were there during those meetings. The gist of it, however, is that the TV industry doesn’t want to undergo the same change that the music industry went through, something that would happen if Apple were to get its way.
However, according to the report, it’s not really the price of the service that TV execs have an issue with – it’s the content on offer, or which channels are offered as part of the base service, and which are left out. According to Re/Code’s sources, that issue is just as important for Apple as it is for programmers.
If Apple were to eventually get its way, the traditional 100 channel TV package would shrink by a massive amount. Of course, while TV execs say that they understand that consumers don’t want to pay for every channel, most of which they don’t watch, as highlighted in the report, most TV execs would argue that their channel is a must-have.
What this means is that companies like Disney want all of their channels in the mix, including ABC, ESPN, and so on. The same goes for 21st Century Fox with Fox News, Sports 1, as well as with NBCUniversal with NBS, USA, SyFy and Bravo.
Eddy Cue, Apple’s media boss, has reportedly proposed having different tiers and packages available. These would include things like a sports bundle, which would be sold on top of the base service. According to Cue, the base service, however, has to remain small and only comprising of key channels. This is because of the fact that Cue thinks this is the best way to keep the service affordable, and because he thinks that consumers want a small and core service.
Of course, it’s important to note that the TV industry itself has been experimenting with leaner channel bundles, however it hasn’t fully accepted them just yet. Verizon, however, is taking things a step further, and is reportedly set to allow users to create their own bundles, giving consumers the option to drop certain channels.
Apple, some might remember, seemed confident that it would be able to pull everything together for a TV service earlier this year. In fact, the company hoped to launch the new Web TV service a few months ago when it launched the Apple TV set-top box. Instead, the Apple TV had to launch as a product on its own, a replacement to the previous Apple TV. While it did offer a number of great new features, it didn’t offer anything groundbreaking.
It’s unlikely that it will be too long before Apple reopens negotiations with TV companies, as the TV industry changes and TV companies will be more likely to want to talk with Apple about how to get their content into households. It will also very much help Apple if the company can prove that the Apple TV is as transformative as it claims. The likelihood of this happening will likely rest on what developers end up doing with the platform, with Apple claiming that the future of the TV is apps.
It will certainly be interesting to see what happens to the TV industry over the next few years. I personally would love to see Apple offer something along the lines of what Verizon is planning, allowing users to subscribe to individual channels and make their own bundles at a reasonable price.