Apple Abandons Streaming 'Cable TV' Replacement

Apple has reportedly ditched plans to launch an Internet-based alternative to cable TV. It is said to have failed to convince channel providers to back its plan for a cheap, basic subscription package.

It's no secret that Apple has been working on such an offering for some time. The idea was to use gadgets such as the Apple TV box to offer a package that replaces the need for cable TV altogether, rather than simply supplementing it.

Had the plan worked, it would have been the next stage of so-called "cord cutting." That's the trend for people refer to as "cutting" the their cable or satellite TV providers subscriptions (either completely or partly), and then using pay-for-streaming Internet services for premium programming, such as Netflix and Amazon Prime.

While the overall level of cord cutting is often overstated, the cable industry is undoubtedly concerned about its long-term future. For example, many college undergraduates already use some sort of streaming to watch their favorite televisions shows while away from home, and will likely continue to do so long after they graduate. Hence the 'habit' of purchasing cable or satellite TV is likely to be phased out in the coming generation of adults.

'Basic' Packages Still Overweight & Overpriced

The problem is that many customers still want to have some of their favorite stations, which aren't currently available online. In many cases (for example), the local cable TV provider requires users to pay for a package with 50 to 100 channels if they are to get cable TV at all. The only other real alternative is to get channels over-the-air with a digital aerial, but that's subject to reception issues.

Apple's idea was to offer a basic package which had around a dozen of the most popular networks and cost around $30 a month or less. Customers would then have the option to pay for additional tiers in the same way as cable TV works. They could also buy premium channels on a standalone basis, as is already available online for HBO. (Source: recode.net)

Apple Flexes Muscle, But Networks Don't Swoon

While many companies have tried such an approach, Apple is said to have believed its strength in the tech world would have been enough to convince TV stations to sign up to its program.

The theory was that if its seemingly inevitable that more and more people will opt for Internet-only TV, then stations may as well get on board with Apple now. It's also reported that Apple had been banking on the idea that its experience in producing simple and reliable user interfaces would have won over customers who felt that streaming television would have been too complicated.

Unfortunately for Apple, it seems the TV content providers simply weren't interested. They want to continue to use bundling tactics by which a cable company offers its customers a popular station, then also force them to pay fees for less popular stations owned by the same company. (Source: bloomberg.com.)

What's Your Opinion?

Would you switch to getting TV solely through Internet streaming (such as via a set-top box) if you could get a basic package for $30? Are the TV networks right to hold out for now, or should they embrace cord cutting? Do you think Internet-only television can ever work, given so many people get their broadband service from a cable TV provider?