Apple’s Grandiose Plans: It Wants to be Hardwired Into Your Home
NEW YORK (CNNMoney) — Apple may have grand ideas about how to reinvent television, but for now, rather than attempting an end-run around the industry’s incumbents, it continues to seek partnerships with them.
The computing giant’s next foray into TV could come in partnership with Comcast, the largest television and broadband provider in the United States, The Wall Street Journal reported Sunday night.
The Journal said that the two companies are holding talks that could result in Comcast delivering an Apple-branded TV service the same way it delivers phone calls and cable video-on-demand. These are called “managed services,” and are set apart from the broadband connections that bring Netflix, YouTube and other websites to customers. The arrangement would allow Apple to be confident that its video offerings won’t sputter the way some other streams do.
The two companies are not close to an agreement, The Journal said.
Talks may be picking up where talks between Apple and another distributor, Time Warner Cable, left off in February. The companies were known to be in extensive talks about a partnership of some kind, possibly involving a cable TV app for the Apple TV box.
The talks were interrupted by the acquisition of Time Warner Cable by rival Comcast, a deal that is now awaiting regulatory approval.
Apple’s talks with distributors reflect its long-rumored interest in rethinking how television is packaged and sold to subscribers.
Right now its hockey-puck-shaped Apple TV box is used in millions of homes to connect TV sets to Internet services like Netflix and the iTunes store. But the device is missing a connection to the much wider world of broadcast and cable television, where the vast majority of TV is viewed.
A distribution deal with Comcast could help Apple get there, though a number of other hurdles would remain. Chief among them: If Apple wants to sell a cable-like bundle of channels to paying subscribers, it needs to obtain the rights from the channel owners.
Apple has conducted negotiations with major media companies about gaining the rights to their live channels and, in some cases, “in-season stacking rights” for video-on-demand, according to people with direct knowledge of the talks who insisted on anonymity.
“In-season stacking rights” would allow Apple to stream complete current seasons of shows on major networks and cable channels, reducing or eliminating the need for a digital video recorder. In one scenario discussed by the companies, advertisement fast-forwarding would be disabled for a certain period of time after the premiere of a new episode.
Apple is not known to have struck deals with any channel owners to date. One distribution executive at a channel owner said that negotiations are not on the fast track.
“Everybody is afraid to make a bad deal, so the deals are very slow to be made,” the executive said.
But many television executives are intrigued by Apple’s imaginative plans. A successor to the existing Apple TV box could incorporate voice search through Siri and use the iPhone or iPod as a remote control.
Representatives for Comcast and Apple declined to comment on Sunday night.