Apple, having conquered the Smartphone and computer tablet market, has yet to overtake the world of cable television. One way the computer giant could make significant inroads on the TV market would lie in offering customers “channels a la carte.” Allowing the subscriber to choose which channels to have would set Apple apart from other subscription services, which typically sell their channels in packages.
Sterne Agee analyst Shaw Wu, in a note to investors says that Apple’s strength lies less in the hardware innovation it might bring in lieu of letting customers subscribe to particular channels or shows of their choosing.
Apple already offers a number of TV programs as subscriptions through its online store. They also allow customer to purchase both single episodes and entire seasons. Customers must wait for the show to be broadcast before it’s available to download. Wu suggests that Apple would rather move to live streaming of the programming, just like what customers get through their cable provider.
“This is obviously much more complicated from a licensing standpoint and in our view, would change the game for television and give AAPL a big leg-up against the competition,” Wu wrote in Apple Insider.
The idea is not new, as a Wall Street Journal story from 2009 suggested Apple was in talks with CBS and Walt Disney to provide TV programming for a monthly fee.
Interest in Apple’s prospective television boomed in October with the release of Walter Isaacson’s authorized biography of late Apple co-founder Steve Jobs.
In that best-selling biography, Jobs said “I’d like to create an integrated television set that is completely easy to use . It would be seamlessly synched with all of your devices and with iCloud. It will have the simplest user interface you could imagine. I finally cracked it.”
In addition, a report from the Taiwanese publication DigiTimes cited sources saying that Apple was already in the process of ordering components for 32-inch and 37-inch TV sets that would be ready for sale in the second half of 2012, suggesting that Apple is relatively far along in the process of bringing the set to market.
Apple has since made two significant adjustments to its sales of TV shows in the past few months. Apple ended its TV show rental service, a decision the company attributed to consumer purchasing behavior “overwhelmingly” falling in favor of buying programming outright. It also introduced a new season-completion program that lets buyers pick up the rest of a show’s season at a discounted rate if they’ve already purchased an episode.
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