Apple TV subscription service in 2010, CBS, Disney on board?
Both CBS and Disney are considering signing on for Apple’s TV subscription service, according to a new report. Citing people familiar with the matter, the Wall Street Journal reports that Apple is currently making a push to complete licensing deals and would like to introduce the service in 2010, although it is unclear whether any networks have signed on yet. The report goes on to state that the service is part of a larger strategy to overhaul the iTunes Store, offering consumers more ways to access and manage their media. This plan ties in with Apple’s plan to launch a multimedia tablet next year; the report cites people briefed by Apple that the company plans to launch it by the end of March.
Apple is having trouble reaching a substantial number of networks for the service, however, as companies such as News Corp., Viacom, Turner Broadcasting, and Discovery Communications appear to be hesitant to join up. Although Apple is said to be offering between $2 and $4 a month, per subscriber, to broadcast networks, and $1 to $2 a month to basic cable networks—much greater reimbursement, in some cases, than what the companies receive from traditional distributors—some executives are worried that the service could undermine the successful model of selling bundles of cable networks to distributors, while others are concerned that the service wouldn’t include advertising. “You don’t want to shoot a hole in the bucket to create another revenue stream,” one media executive said. Apple’s plan may be changing as it continues to try and sign on networks, say people familiar with the matter; the initial proposal had the company selling access to ad-free shows from a group of top cable and broadcast networks for $30 per month.
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