Monday, August 20, 2012

Apple's TV interest in Cable Rebuffed

A couple of weeks ago, it was reported that Apple was approaching several large cable MSOs about the possibility of providing set-top boxes that would integrate Apple TV interfaces and services.  It's become fairly clear that cable operators have not exactly embraced the idea.  The Wall Street Journal has a good story on the cable industry's reaction, suggesting that Apple's seems to be focused more on delivering its software and services than providing hardware.
  Moreover, a new report from Bernstein Research suggests that there are meaningful differences between the mobile world, where Apple has been quite successful, and the market for multichannel TV services.
Not only does the cable TV market, unlike mobile, feature network distributors that also own content, it does not subsidize end user devices, and it is heavily involved in determining the capabilities of those end user set-top box. That final point, in particular, is something that service providers in the mobile market pretty much ceded to Apple.
  Bernstein's report suggests that Apple might find the differences difficult to overcome.  More critically, the primary focus of multichannel has been to provide the widest range of choices to subscribers, and Apple has been insistent on providing what's called a "walled garden" - a limited set of services that conform to Apple's standards.  I think that that's going to stand in the way of their move into TV, if they  continue to insist on that approach.

Sources - Apple: High Hurdles to Working with Cable Guys,  Bernstein Says, Barron's
Apple's New Front in Battle for TV, Wall Street Journal

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