According to sources close to the negotiation process, Apple Inc. (AAPL) is said to be nearing the final stages of a deal with the US’s second-largest cable provider Time Warner Cable (TWC) that would make content available to subscribers through the tech giant’s set-top Apple TV devices.
Apple has long been promising to revolutionize the TV-viewing experience, but so far these efforts have amounted to little more than its Apple TV devices, which have struggled to compete with similar offerings from Roku and Microsoft’s (MSFT) Xbox.
Time Warner already offers some of its programming to subscribers through Apple TV, including HBO programming, and some of its channels can be viewed on iPhones and iPads. But the cable company has similar arrangements with some of Apple’s competitors as it has made deals with both Roku and Microsoft, and as recently as last month announced that some content would be available on Google’s (GOOG) Android-based devices via an app called TWC TV, as well as a certain line of upcoming Samsung televisions.
At the All Things Digital tech conference last May, CEO Tim Cook bemoaned the outdated nature of the TV viewing experience, and pointed to the 13 million Apple TV boxes that have been sold since the device first became available back in 2007. But while he claimed then that the TV experience “has not been brought up to date for this decade,” confirming speculation about the company’s interest in the medium, it is not clear how signing a content-sharing deal with one of the country’s biggest cable companies makes Apple anything more than a status quo player in the streaming content market.
This is particularly the case when considering that Apple TV has to contend not only with rival set-top devices, but also online services that stream content such as Netflix (NFLX), Amazon (AMZN), Wal-Mart’s (WMT) VUDU on-demand service, and most recently the Coinstar (CSTR) owned Redboxinstant. Much of the competition between these companies has centered on securing the rights to content, as was seen most recently when Netflix’s licensing deal with Viacom (VIA) expired. Amazon ended up with the contract instead, leaving its competitor bereft of key programming from channels such as Nickelodeon and Comedy Central.
While it is entirely conceivable that a revolutionary TV product is somewhere in Apple’s pipeline, for the time being it seems as though the company will have to get into the trenches in the increasingly competitive streaming content market, and make its way in a more conventional manner.
Time Warner and Apple were unwilling to either confirm or deny the speculation, but an agreement between the two companies is expected to be finalized within the next few months. Apple has also enlisted the help of former Hulu senior vice president Pete Distad to help negotiate with cable providers and other media companies.
While Tuesday saw stocks generally down, Apple closed the day on an advance of 2.27 percent at $418.50, after gaining over 3 percent to start the week.
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