Business

Apple throws weight around in TV negotiations

Tim Cook

Tim Cook (Reuters)

While Apple harbors big TV ambitions, it’s having a tough time getting media companies to play along.

Apple is pushing ahead with plans to launch a streaming TV service by Christmas — despite making little headway in its negotiations with content providers, The Post has learned.

For months, Apple’s point man, Eddie Cue, has been leading talks with content providers, which have largely balked at the tech giant’s efforts to exert control over all aspects of the video service, including pricing, sources said.

Apple’s negotiating stance can be summed up as “we decide the price, we decide what content,” according to one source familiar with the talks.

“They want everything for nothing,” said another media executive, echoing similar tense negotiations Apple has had in the past with magazine publishers and music companies.

Apple is pitching the idea of offering channels as apps for its devices, including its Apple TV set-top box. It’s unclear whether it would group the apps together and charge a fee — similar to a cable-TV subscription — or offer the channels on an a la carte basis.

Apple’s iTunes allows users to rent and download TV shows, but the company is hoping to add a streaming video option over the Web. Also, several TV networks, such as ABC, offer apps that allow users to watch some shows.

Apple’s earlier attempt to create a bundled video offering failed to gain traction when it first broached the idea in 2009. One problem was that Apple wanted to share in the ad revenue rather than pay a distribution fee like Netflix and other streaming video providers.

More recently, Apple has tried to get cable operators to work with it to improve the accessibility and look of video services and in the process dump their clunky cable boxes in favor of sleek Apple devices.

“They want to create the interface, and they wanted to work with the cable guys to manage bandwidth across the TV and broadband pipeline,” said one source familiar with the talks.

Instead, cable executives pretty much shut the door, preferring to keep Apple at a safe distance from the lucrative $150 billion pay-TV business.

At the same time, the cable guys are jumping into the streaming video business. Cable giant Comcast just launched its own streaming content service, Streampix, while Time Warner Cable isn’t far behind.

Of course, Apple isn’t alone in hoping to break the hold of traditional pay-TV distributors. Both Sony Corp. and EchoStar’s Dish have been pursuing deals for Web-based TV packages.

Apple hasn’t given up, however, and is said to be pursuing deals with telecom companies such as Verizon and AT&T. It hopes to get traction with a single player in hopes of pulling the rest of them along.

While Apple is also rumored to be working on its own actual TV set, sources believe its first priority is to bring a TV service to the market.

Apple is expected to unveil an updated Apple TV device on March 7, after sending out an invitation that reads, “We have something you really have to see. And touch.”

Apple declined to comment.