Cutting the Video Cord: “Apple TV” 2.0 + Disney & CBS

by on December 22, 2009 · 7 comments

By Adam Thierer & Berin Szoka

The Wall Street Journal reports (see Financial Times, too) that “CBS Corp. and Walt Disney Co. are considering participating in Apple Inc.’s plan to offer television subscriptions over the Internet, according to people familiar with the matter, as Apple prepares a potential new competitor to cable and satellite TV.”

If Apple signs up enough networks to launch a viable service—still a very big if—it could ultimately alter the economics of the television business. The service could undermine the big bundles of channels that cable, satellite and telecommunications companies, including Comcast Corp. and DirecTV Inc., have traditionally sold in packages to subscribers.

And Brian Stelter of The New York Times says of the plan:

Broadband Internet subscriptions to TV networks could potentially destabilize the bedrock of the television business, which relies on subscribers paying for dozens of bundled channels.

As we have noted have noted here in our ongoing “Cutting the Video Cord” series, it’s just another sign that the video marketplace is vibrantly competitive and experiencing unprecedented innovation. So, why is Washington regulating this marketplace like we still live in the disco era?

The New York Times itself seems to be of two minds on this: Brian seems to recognize that the rise of Internet television means that cable providers no longer have any sort of special “gatekeeper” or “bottleneck” control over the programming available to consumers, just as his colleague Nick Bilton at the Times‘ BITS blog recently declared that “Cable Freedom Is a Click Away.” And yet, as Berin recently noted, when the DC Circuit struck down the FCC’s outdated 30% cap on the number of homes a single cable provider could serve (based on “gatekeeper” concerns) back in September, the  Times editorial page bemoaned the decision and demanded further regulation of the cable industry—even as Internet TV is fundamentally changing the marketplace for video programming and rendering moot “gatekeeper” concerns far more effectively than any law could ever do.

“Right hand, meet Left hand. Howyadoinnicetameetcha!”

  • MikeRT

    The only things that would hold Apple back would be lack of content and the speed of a user's broadband connection. If they can get each participating studio to address the former, I think a $30/month plan with advertising would be a hit if it came with access to the entire back catalog, on demand of the participating studios (which is a feature that Apple could offer, but cable cannot).

  • cybertelecom

    The current AppleTV is a 160 GB storage device. Subscribe to your favorite shows and let them trickle download in the middle of the night – bypassing broadband bottlenecks. This is an advantage of the current AppleTV device over the Netflix device which is streaming only.

  • Pingback: Cutting the Video Cord: “Apple TV” 2.0 + Disney & CBS — Technology …()

  • Berin Szoka

    Sounds just like a DVR to me! And yet, we will still have some people telling us that consumers are too dumb or too lazy to switch, so alternatives like Apple TV “don't matter” in reassessing the need for outdated regulations based on the world of media scarcity of the 1980s.

  • bizbox

    I'd like to see subscriptions added to Apple TV, but there are a lot of other things I'd like to see added first:

  • bizbox

    I'd like to see subscriptions added to Apple TV, but there are a lot of other things I'd like to see added first:

  • Pingback: “Apple May Be On The Verge Of Kneecapping The Cable Industry. Finally.” and related posts « Twitter()

Previous post:

Next post: