It’s well known that Apple wanted very badly to offer a “skinny bundle” of TV content with its Apple TV streaming box. A new report this morning from the Wall Street Journal sheds some light on why the content part never happened. Not surprisingly, Apple tried to use its largesse and buying power to push Hollywood content owners into giving it special loyalty rates and terms—terms that the content owners (think CBS, Fox, ESPN, Disney) weren’t willing to give longtime partners of the cable companies.
One cable industry executive summed up Mr. Cue’s negotiating strategy as saying: “We’re Apple,” the report says. Cue sought to take away the content owners’ main money-making move: yearly renegotiations of royalty rates to raise prices. Cue wanted a three-year rate freeze on negotiated rates. “Time is on our side,” Cue has been known to say to studio executives when talks hit an impasse, the report says.
The report says Apple had some half-formed deals with Disney and Fox last summer, but refused to offer the volume of content the two wanted to distribute through Apple TV.