WSJ: Apple’s “hard-nosed” negotiation tactics have “alienated” cable providers

By , Jul 28, 2016

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Apple’s stubbornness and “hard-nosed” negotiation tactics have backfired and “alienated” cable providers, who say the firm is a cheapskate in terms of paying for digital content, reports The Wall Street Journal. For years, Apple’s been persuading cable firms to let it sell their cherry-picked programming in a skinny TV bundle of its own for about $30 per month vs. $80+ for traditional cable subscriptions.

According to the story, executives at Disney, one of Apple’s closest partners in Hollywood, were taken aback by Apple’s “assertive negotiating style”, especially after Apple’s chief content negotiator Eddy Cue came to them proposing a very low offer.

“Mr. Cue is also known for a hard-nosed negotiating style,” reads the report. “One cable-industry executive sums up Mr. Cue’s strategy as saying: “’We’re Apple’.” Other cable providers with which Apple held talks complain about other unusual demands, like insisting on guaranteed monthly rates per viewer over the course of several years.

“Disney, which owns channels such as ESPN and ABC, was stunned, though, when Apple executive Eddy Cue made demands that would have upended decades of cable-industry and Hollywood practices,” reads the report. Similar talks with media giants that included 21st Century Fox and CBS also stalled.

All of that has prevented Apple from introducing a video-streaming service.

Disney was interested in partnering with Apple, but became ultimately disappointed after hearing Apple’s proposed terms back in 2015. Apple’s proposal is polar opposite of the way of doing business that the networks are accustomed to, where they get rate increases every year and rely on them to fuel profit growth.

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And more importantly, allowing Apple to get its way could prompt traditional cable-TV distributors to demand the same deal.

“We’re challenged in a lot of ways, but we’re not waiting for this white knight to come racing in the way music was,” one senior TV executive said.

As a quick backgrounder, the Steve Jobs Trust owns 130–140 million shares of stock in The Walt Disney Company, or about 7–8 percent, making Jobs’s widow the largest individual shareholder of the Mickey Mouse House.

Disney CEO Robert Iger has a seat on Apple’s board of directors.

Source: The Wall Street Journal

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  • I feel they expect the cable companies to agree to their terms the same way the music labels did. But it’s not nearly as bad a situation for the cable providers. But I hope PlayStation Vue can launch on Apple TV in the meantime, because it’s exactly what I want in a streaming service.

    • Y2J

      PlayStation Vue is definitely my favorite service and if it launches on ATV I would strongly consider getting my family to switch over

      • Me too. My relatives only watch local sports and have the smallest cable packages (or slightly more). And they gave FiOS. or Optimum, so there’s no data caps, as far as I know.

      • Y2J

        It’s really a great deal, especially now that they do have all the local sports channels and ESPN/Disney. I still don’t understand why they haven’t made it available on their PlayStation TV.

      • I just want it on the Apple TV. Does it support AirPlay?

    • 5723alex .

      Just install Kodi with some added “features”.

  • Bill

    “Apple’s proposal is polar opposite of the way of doing business that the networks are accustomed to, where they get rate increases every year and rely on them to fuel profit growth.” Oh boo fkin hoo…cry me a river!

    I am just absolutely sick and damn tired of this “hand over fist profit increases each year” BULL$HIT! Greed greed greed….it’s ruining everything. Can’t even have a library these days because it’s “not profitable”

    FK YOU, “CIVILIZED SOCIETY” … are anything but.

    • Shinonuke

      I was agreeing with you until your last sentence there

      • Bill

        You’re right, it’s a human condition in general and not limited to those who claim to be civilized.


  • Joey_Z

    They can increase their rates every year, I cut my cable 4 years ago. Way to lose customer.

    • Shinonuke

      Yup. Cut my parents’ tv service and got them in Netflix. I got Netflix for myself. The only series that I watched on Netflix is Star trek reruns…Oh an some updated movies too. Oh and since I am Amazon prime member, I get their free streaming service too

  • mahadragon

    TV and entertainment executives dragging their feet. The Entertainment industry is fundamentally changing whether they like it or not. They want to keep their heads buried in the sand. That’s fine, the world will change around them and Apple will be in position to deliver the services they want at some point.

    Lots of people becoming cord cutters. I have never been a cable subscriber. All I need is Netflix, YouTube, and Redbox for my movie and entertainment fetishes. Movie execs can get with the program or die. HBO, Showtime, and others are all going a la carte. It’s just a matter of time before ESPN and the rest do the same.

    • Shinonuke

      Same. Except my redbox days are limited to arrival of a new family member. I love redbox. Oh and since I have Amazon prime, I get free streaming service too

      • mahadragon

        From what I understand, Amazon charges for many of their movies on Prime. I used to be Prime member and I was very unimpressed with the limited number of movies that were free to stream. It was enough to cancel the service and not look back.

      • Shinonuke

        We hardly use the streaming service of Amazon prime. You’re like that it is not the same as Netflix but they got random movies that I don’t see on Netflix. It is free so we use it sometime.

  • Alex Wilson

    Rock meets paper, paper wins… for now, but in the long run they will lose. Cutting the cable is only gaining ground. People are tired of paying for all the cable TV crap they don’t watch or want to support. At this point I watch so little TV it just doesn’t matter that much to me.