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Relentless Innovation
Apple Cuts the Cable

There are few things consumers across America hate more than inflated cable bills and the poor service that often accompanies them, but now Apple may taking us one step closer to cutting the cord. The WSJ reports that the iconic tech company is taking strides towards creating its own online television service and is currently in talks with networks about launching a collection of channels as early as this fall. More:

Apple has been talking to Walt Disney Co., CBS Corp., and 21st Century Fox Inc., among other media companies. The idea is to offer consumers a “skinny” bundle with well-known channels like CBS, ESPN and FX, while leaving out the many smaller networks in the standard cable TV package. 21st Century Fox and News Corp, owner of The Wall Street Journal, were until mid-2013 part of the same company. […]

Some media executives said they believed Apple was aiming to price the service at about $30 to $40 a month. The company is aiming to announce its new service in June and launch it in September, according to people familiar with the matter. The service would work across all devices powered by Apple’s iOS operating system, including iPhones, iPads and Apple TV set-top boxes.

Apple is not the first company to try this—in fact, there’s quite a lot of competition. Disintermediation is the name of the game for today’s TV. Dish Network recently launched its own online television service called Sling TV, and it appears Sony will do the same shortly.

Apple’s idea isn’t revolutionary on its own, but the more companies experiment with streaming TV, the closer the country comes to shedding its reliance on traditional cable. The crowded field will spur innovation. And with Apple’s resources behind the online TV push, the switch to streaming could happen quickly—to everyone’s delight.

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  • WigWag

    Is it disintermediation?

    Yes, but it’s disintermediation-lite. The cable giants are ripe for the picking, but they’re not the only intermediaries ready for the morgue. Next up its the content providers. Who needs Comcast/NBC, Fox, Disney and the like to chose what entertainment offerings are available through Apple, Roku or any other platform?

    Before long it will be artists and other producers of entertainment providing entertainment opportunities directly to customers using new technology without the mediation of the entertainment giants.

    But that’s not all; it may take a few years, but it won’t take that long before voice and data transmission will be feasible and efficient without the Verizons, At&Ts and Sprints of the world.

    Every one of these intermediaries will do what intermediaries faced with destruction always do; they will beg for protection from the government. Unlike taxi fleet operators threatened by Uber, the Comcasts, Disneys and Verizons of the world are enormously powerful and influential. Their executives make big campaign contributions and they spend tens of millions on lobbying. Both political parties are benefit from their largess.

    The political party most capable of resisting the demand for protection that these companies will advocate for is the political party most capable of taking America into the future.

    It could be the GOP or the Democrats or it could be both or neither.

    I’m betting on neither; but creative destruction always wins out in the end.

  • Andrew Allison

    There one little fly in the ointment. I’ve seen estimates that Netflix alone consumes 25% to 30% of the available Internet backbone bandwidth. What happens when the bandwidth currently provided by cable moves to the Internet?

    • Josephbleau

      Internet capacity will be expanded by the power of capital funding of true consumer desire.

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