NYT spells out Apple’s living room strategy

Apple TV Standing

Apple’s plans for the living room have rested largely on the Apple TV the company’s leadership continues to call “a hobby project.” While there’s been talk that the tech giant could unveil its own television set, rumors of revamping the television experience have been greeted with industry concern and fruitless negotiations.

However, now comes word Apple wants to be friends with Time Warner, Disney and other content producers – and along the way improve some of the worst aspects of current television viewing.

One result of the partnerships is an upcoming Time Warner Cable Apple TV app that would turn Apple’s $99 set-top box into a channel guide for live and on-demand programming much superior to the clunky software now offered by the distributor…

Apple is “trying to apply their software expertise, their user interface expertise,” one person involved in private talks between distributors and Apple told the New York Times.

Apple has talked in-depth with other big distributors about similar apps, according to people involved in the talks. Its intent is to collect a fee from distributors in exchange for enhancing their television service and in that way, theoretically, make subscribers more likely to keep paying for cable.

Another example is the co-operation between Apple and 1 Mainstream, which developed a free Sky News streaming app for the Apple TV.

“It’s a learning year for Apple,” 1 Mainstream CEO Rajeev Raman told the paper. “And it’s a learning year for all of us, to say, O.K., what really does work?”

At the same time, Apple’s content negotiator, Eddy Cue, recently attended the Sun Valley conference.

Apple TV companion
Brightcove’s CEO called for an Apple TV companion product with a coax input, motion sensing and an Apple TV app store.

For Apple, along with updating an experience company CEO Tim Cook has described as “too much like 10 or 20 years ago,” the switch from antagonizing to appeasing television networks could also take up the slack from slowing iPhone sales.

As part of the potential agreements, Apple would charge distributors a fee to create apps that may keep cable customers.

Tim Cook and Eddy Cue arrive at Sun Valley (Jon Erlichman 001)
Apple’s boss Tim Cook and content king Eddy Cue arrive at the 2013 Sun Valley retreat

The Thursday report also claims Apple has proposed “an ad-skipping technology that would compensate networks for the skipped ads by charging users.” Although described as far-fetched, the idea “intrigued some of the channel owners who were briefed about it”.

Apple’s ad-skipping tech was first reported on by the former Wall Street Journal reporter Jessica Lessien.

Apple’s decision to aid television distributors likely will also mean it should get a friendlier hearing when it comes to distribution deals. The report could also puts a crimp in Google’s plans to create an online television service that competes against the likes of Time Warner and cable giant Comcast.

APPLE TV report

While the news of Apple’s partnerships with television leaders seems a departure from past tactics, the apparent shift has been underway for some time.

In June, Apple announced Apple TV owners would get HBO and ESPN apps – but only for cable or satellite subscribers. When Apple announced iTunes Radio, the company agreed to pay royalties that were slightly higher than rival Pandora.