Apple has long been rumored to be working on a digital streaming service for Apple TV. To make this happen, The New York Post reports that the company might consider buying Time Warner.
Why Time Warner?
As the report confirms, Time Warner controls a vast content library, which includes HBO, Turner Broadcasting System, Inc., and Warner Bros. How likely is this? Fortune believes this rumor “feels different,” noting:
Apple has been trying for years to assemble a “skinny bundle” of the most highly desired channels—or “apps,” as Tim Cook prefers to call them. The idea is that if the programming is good enough, if the price is right, and if the package includes live sports, cable TV subscribers will cut the cord and leave the world of 500-channel TV for Apple’s streaming service.
I would agree.
It’s no secret that Apple wants a larger role in the entertainment industry. Until recently, this meant trying to convince the principal players that its cord cutting ideas were best. That hasn’t worked, as companies such as CBS have been unwilling to give Apple so much control over how content is delivered. Buying Time Warner would allow Apple to change the playing field on its own. And bring popular titles such as “Game of Thrones” and “Veep” along for the ride.
If not Time Warner, who? Though I’m warming to Apple’s possible purchase of Time Warner, I’m still pushing for a merger with Disney or the purchase of Netflix.
Merging with Disney
Apple and Disney have a long history together with Steve Jobs having co-founded Pixar Animation Studios in 1986. In 2006, its acquisition by Disney was completed. In Disney, Apple would gain an immense film library, and own a stake in some television networks, including ABC and ESPN. The purchase would also give Cupertino a large stake in Hulu, which would be an excellent way to continue the re-energization of the Apple TV.
- Pros: Film library and TV holdings are expansive.
Cons: Very expensive, and would Apple want to own theme parks?
Buy Netflix outright
A Netflix acquisition would make Cupertino a major player in the streaming video market, a place it has been slow to embrace. Additionally, Apple could use Netflix’s original programming arm to influence Hollywood more. It would also help Apple compete against Amazon and yes, Hulu.
- Pros: Instant library, more influence in Hollywood.
- Cons: As 2016 begins, Time Warner feels like a better fit.
The fourth-generation Apple TV is arguably the best product Cupertino has released in the past year. However, it’s still missing something. That something could be Time Warner content, now owned by Apple. And despite Apple’s recent stock woes, the company has more than enough cash to get it done.