Apple Planning To Offer 'Skinny' TV Service, Reports Say
DON GONYEA, HOST:
Every time a company hints at offering its own TV subscription service, we ask what it means for traditional television and cable. And now we're doing it again - enter Apple. The company is reportedly working on a TV service with a selection of channels that could feature many of the top networks. Meg James, of the Los Angeles Times, has been looking into this. Welcome, Meg.
MEG JAMES: Thank you.
GONYEA: First, what have you learned about what Apple is planning?
JAMES: Well, Apple is planning a new television service that would have some of the major broadcast networks - CBS, Fox and ABC. And they'd like to have their new service launch this fall in time for the rollout of the new fall season.
GONYEA: What's the cost?
JAMES: We really don't know the actual cost because Apple is keeping the details tight under wraps. But we think it's going to be about $30 to $40 a month for a subscription. It really depends on the number of channels and what channels that they have in their package.
GONYEA: You didn't mention NBC as one of the potential networks in there. What's going on there?
JAMES: That's a very interesting case. NBC is owned by the nation's largest cable operator - Comcast. And right now Comcast is trying to get federal approval for a major takeover of the second largest cable company - Time Warner Cable. And one of the reasons why some have speculated that NBC isn't involved right now is because Apple is looking to take a bite out of Comcast, you know, core business, which is offering cable TV channels.
GONYEA: So cable's been feeling this pressure and this competition from all over the place for a while. But how does Apple's potential entry with its own service really change that?
JAMES: The reason why so many people think that Apple might be a game changer is because of their success with all of their devices - the iPhone, the iPad, and now they're even rolling out a watch. If Apple could corner the market on delivery of TV channels then it's going to put a lot of these incumbents - like Comcast, Time Warner Cable - on their heels. They're going to have to cut their prices to try to compete with these lower-cost options that Apple and others are, you know, trying to provide.
GONYEA: Again, we don't know the cost yet, but, say, the basic Apple offering here of this service is in that $30 range or so, as you mentioned. It sounds a lot cheaper than your $90 or $100 cable bill. But if you have to cobble services together, adding HBO to that and Netflix and a few other things, is it really going to be cheaper?
JAMES: Well, analysts have pointed that out this week. They say that - and this actually, Don, might be the ace in the hole for the traditional players - the DirecTVs, the Comcasts and Cox. The thinking is is if you start, you know, paying $15 for HBO here, $30 or $40 to Apple there, then you have your Netflix subscription that it's going to end up costing $70 or $75, whereas these traditional providers like Comcast and Time Warner Cable also provide the high-speed Internet lines that you're still going to need. And so the thinking is is that a lot of consumers will want to write just one check rather than five different checks to all these different programmers.
GONYEA: Meg James is corporate media reporter for the Los Angeles Times. Meg, thank you.
JAMES: Thank you, and welcome to the brave new world of TV.
GONYEA: All right.
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