Apple is having progressive talks with ABC, CBS, NBC and Fox, pushing its streaming TV service project closer to reality, says a report from the New York Post. It is expected that CBS or Disney will be the first to enter into a deal with Apple, says the report.
Apple making progress with networks
One of the major roadblocks was Apple’s keen interest in the live feeds of local channels. However, since affiliate feeds are not under direct control of the networks, the iPhone maker has asked the networks for affiliate rights instead of wasting time in closing every individual deal.
Networks are reportedly doing a good job by negotiating with Apple on behalf of affiliates, and in return, the affiliates are promised a share from the revenue that the Apple service generates, says the report, citing sources familiar with the matter.
According to the New York Post, both Tim Cook and Eddy Cue had a discussion with NFL commissioner Roger Goodell and New England Patriots owner Bob Kraft. Possibilities of this being a friendly meet cannot be denied, but there are fair chances of Apple executives convincing the NFL to strike a deal in some form.
Still few challenges remain
There are reports that the Cupertino, Calif.-based company is also looking to sell customers a “skinny” channel bundle. However, there are still some challenges, such as whether TV partners will have to forgo 30% of subscription fees if they are paid through App Store. Generally, Apple asks for 30% of all App Store purchase revenue, even if a user is paying for a third-party service bought from an iOS app. If the company goes by this policy, the revenue of the networks will take a massive hit.
The next challenge is that the networks have already given approval to the “most favored nation” clauses, suggesting they cannot charge Apple less than the others. On the other hand, Apple has yet to decide on how much it will charge, with estimates reportedly swinging between $10 and $40 per month.
Apple is expected to launch the service by late fall, and many believe the service will come with cable-only channels such as Discovery and ESPN. If the company succeeds in offering streaming live local news, it could be a big game changer for the U.S. firm in the growing market of set-top boxes.