The state of Apple’s TV quest

Will Apple build a TV set? Will they become a content distributor? The answer is complicated. This article does a good job laying out all the parameters.

One alternative being considered is that Apple could essentially become a cable company itself. Under that scenario, sources say, Apple would launch what is formally known as a virtual multichannel video programming distributor. MVPD is the catch-all term for pay TV services, whether delivered over cable lines, satellites, or otherwise. A virtual MVPD would offer such content entirely over the internet. Intel, Google, and Sony are known to be preparing virtual MVPDs of their own.

Just as happened in the music space, companies like Apple act as a disruption to an existing business model. In this case, the disruption to the TV space has been going on for a long time. A new studio system is evolving and, in many cases, succeeding. Netflix broke through with “House of Cards”, creating and distributing content completely outside the traditional mechanisms.

However Apple’s television service is formally regarded, it will still be seen as disrupting the TV industry. In its talks with content companies, say sources, Apple notes that it has nearly 600 million iTunes accounts and is good at getting people to pay for content. It made similar claims when it negotiated with companies in music and publishing, and it has indelibly changed those industries.

This is going to get interesting.

  • Moeskido

    Bring on á là carte, Apple. I’ve been waiting a long time.

    • Mother Hydra

      I, for one, welcome our new á là carte overlords. This can’t happen soon enough for me.

      • AdamChew

        You must be referring to google or Amazon.

  • McCoy

    Content is one thing, but physical television is a major challenge for Apple (and others) – more specifically to understand the variance of television systems across the world, and how they are likely to evolve. Whilst the US is cable driven, the UK and other European countries have a terrestrial core over VHF radio spectrum, predominantly now DVB-T. With a significant proportion of satellite. The apparent roadmap with Apple TV as we know it seems to be to provide content over wired home broadband internet. But with bandwidth issues, capacity issues, and here in the UK, huge areas of the population who cannot even get 2 mbps, let alone the 40-100 of some countries, there are commentators who believe the future will come from wide area coverage of fast VHF radio frequency, multiplexed in the same way old analogue TV frequencies are now being used for 4G mobile phone networks. So the future may come from wireless/EM rather than wired or fibre systems. And with the capacity will finally come convergence of all voice/data/video/TV content. Who will be the winners in that new world? Content subscriptions will provide the most profit. But who has the financial reserve to build this infrastructure? Without the infrastructure to support it, and supply it, content is irrelevant. All the streaming HD movie content in the world makes no difference to me, and my frustrating 1 mbps internet…

    • Moeskido

      Ubiquitous broadband isn’t. There are lots of territories here in the states that are poorly served, too. They don’t get talked about much.

  • sloppyjoe

    One thing we need are more high speed connectivity options. When we cut traditional cable, but rely on the same company to provide broadband, we all know the cableco will just jack the rates on broadband. Really tired of lack of competition – and I’m not even in a rural location – 2nd tier market. I believe this is an issue Apple will somehow have to address for the penetration they will want.