We’ve long been hearing a rumor that Apple aims to get into the TV business by selling streaming bundles of various networks, and now we’re hearing it again, despite the company’s statement that it was no longer pursuing plans for a streaming TV bundle. This time, it comes with an extra detail: Apple reportedly wants to offer a premium bundle containing Showtime, HBO and Starz.
Apple may be trying to get together a premium TV bundle
According to Recode, the iPhone maker is trying to put in place all of the pieces needed to offer such a streaming TV bundle. The technology website notes that the company already offers access to each of them individually. Now it adds that Apple has approached HBO, Showtime and Starz about combining them into one package similar to how traditional pay-TV providers have done for a long time but with one key difference.
Traditional pay-TV providers such as Comcast or Charter typically require subscribers to pay for a base set of channels before they can purchase a bundle of premium TV networks including channels such as Showtime, HBO and Starz. However, according to Recode’s sources, Apple wants to sell the premium TV service bundle as a separate, standalone streaming offering. Subscribers could then view content from the three premium TV channels via their Apple TV set-top box, iPhone or iPad.
Jim O’Shaughnessy: Fear Signals Created By The Reptilian Brain
ValueWalk's Raul Panganiban interviews Jim O’Shaughnessy, Chairman, Co-chief Investment Officer, and Portfolio Manager at O’Shaughnessy Asset Management. In this part, Jim discusses the fear and emotional signals created by the reptilian brain. Q1 2020 hedge fund letters, conferences and more That's very cool. For the factor to try to seek the reason why it works, Read More
Will Apple be successful?
Apple has said publicly that it has ended its efforts to get together a streaming bundle of traditional channels, despite the success others such as DISH Network, AT&T, Google’s YouTube, Hulu and others have had in this area. Media chief Eddy Cue admitted that traditional TV channels aren’t willing to agree to the terms he wants in order to build a package, although that was after rumors suggested that very thing.
The iPhone maker is known for its high margins secured through high prices, and it has squeezed third parties to secure its margins in the past. You may remember that Taylor Swift pulled her album 1989 from the company’s streaming music service two years ago. She was fighting back against the company’s decision to not pay artists during the three-month free trial it was offering subscribers when it launched the service. Apple capitulated to her demands quickly and agreed to pay artists during the free trial.
Thus, it makes sense that traditional networks wouldn’t agree to whatever Apple was offering, even though they have struck deals with other streaming TV services. It might be easier to strike a deal with HBO, Showtime and Starz, however, since the company already sells streaming access to them individually. The only problem would be whether Apple wants too much and is willing to pay too little.
Apple currently offers HBO’s streaming service for $15 per month, Showtime’s service for $11 per month, and access to Starz’s streaming offering for $9 per month. Recode said it’s unclear how much the iPhone maker might charge subscribers for a bundle containing all three streaming networks.