Thursday, September 6, 2012

Apple Inc. (NASDAQ:AAPL) Getting Into Serious Talks With Media Companies

Engineers at Apple Inc. (NASDAQ:AAPL) have been slogging since 2005 to reinvent the experience of TV viewing. Designing the gadget may seem easy as compared to convincing media and cable companies to relax their grip on the television industry.

This rivalry is no match to Apple’s past ventures into mobile phone and music spheres when the manufacturers of iPhones and iPods had entered into negotiations with destabilized record labels and a broken wireless industry. Now, the risks are higher and the competition is tougher.

Apple is contending the likes of Microsoft, Amazon and Google to make TVs the digital heart of people’s everyday lives in an industry that is expected to reach $200 billion globally by 2017. Anyone, who wins, must strike deals with cable providers and media companies that have enough incentives to yield valuable revenue streams. As analysts had previously predicted, Apple would not be releasing a new TV this years.

As per an analyst at Sanford C Bernstein & Co., Craig Mofett, Apple would need to come with very strong grounds to turn the cable industry upside down. The very idea that Apple could take off the curtains from its TV system ignores the business realities that make the industry a complicated place.

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In latest negotiations, the main obstacles with cable companies have taken into account a brawl for control over the software that decides the screen interface, the feel and look of the viewer’s experience. TiVo is offering the same thing for over a decade with it’s a hard drive equipped set top box that lets users to record broadcasts and stream internet fare.

Apple, based in California, and cable providers have thought about whether a new Apple TV set top box must be sold directly to customers or be leased through cable providers.

Apple’s television efforts have been restricted to $99 Apple TV that is a small box streaming shows, movies and other contents on the Web. It doesn’t deliver recorded shows or live broadcasts, unlike set-top boxes from cable providers. 

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