Apple Inc. Wants TV Networks To Bear Streaming Costs [REPORT]

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Apple Inc. Wants TV Networks To Bear Streaming Costs [REPORT]
ElisaRiva / Pixabay

Apple has asked TV networks to bear the cost and responsibility of streaming infrastructure, says a report from Re/code, which cites sources familiar with the matter. Even though streaming video is normally a low-cost proposition, Apple is concerned that the costs could spike dramatically for heavily promoted services, says the report.

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Apple to focus on strength

Eddy Cue, Apple’s head of Internet Software and Services, is supervising the negotiations for the new platform and conveyed to TV executives that Apple wants to focus on its strengths such as hardware and software, delegating the responsibility of streaming infrastructure to more experienced entities, claims the report.

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“Apple is asking TV networks to handle the responsibility and cost of the streaming infrastructure associated with its Web video service, industry executives say,” the report says.

One source differed from Apple’s theory, suggesting that the company could be striving to present internet service providers with a better deal. The report noted that if the providers protect their own streams, then internet service providers such as Comcast and Verizon, which offer their own video programming, are less likely to penalize Apple’s service.

Not an unusual proposal

The report notes that many video services already “stand up” their own streams in collaboration with third-party content delivery networks, therefore, Apple’s proposal is not surprising. A few of such content providers such as Fox, CBS and Disney are in dialogues with Apple.

Not much information about Apple’s long-awaited streaming service is available. The Worldwide Developers’ Conference is seen as the potential event at which the Cupertino, Calif.-based company will launch the service, which is expected to be priced between $30 and $40. The upcoming set-top box is expected to come packed with an A8 processor, Siri and extra storage for the new App Store.

A recent report from The Wall Street Journal said Apple will launch its TV service this fall. The Journal claimed that the service will offer about 25 channels and is in talks with broadcasters such as ABC, CBS and Fox. The service is expected to work on all Apple devices, including iPhones, iPads and Apple TV set-top boxes.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com
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