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5 cord-cutting problems Apple TV Channels won’t solve

In trying to simplify TV streaming, Apple is hitting the same roadblocks as everyone else.

5 cord-cutting problems Apple TV Channels won’t solve

Apple is on a quest to simplify TV. During its press event on Monday, the company announced a service called Apple TV Channels that will combine premium channels and streaming services such as HBO, Starz, and CBS All Access into a single app and billing system.

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“[O]ur vision for the Apple TV app is to bring together your favorite shows, movies, sports, and news, and make them available on all your devices, so you can spend less time looking for something to watch and more time enjoying it,” CEO Tim Cook said.

But in trying to aggregate all kinds of video sources, Apple is running into the same roadblocks as Roku and Amazon that have also launched subscription marketplaces on their respective streaming platforms. While these “Channels” offerings can make cord cutting feel less cluttered, they are not a panacea for some of streaming’s biggest pain points, at least not yet. Here’s why:

Peter Stern [Photo: courtesy of Apple]

Problem 1: Cable channels still aren’t unbundling

At Apple’s event, VP of services Peter Stern described the new Apple TV Channels service as an alternative to big cable bundles, providing “only the channels you want, on-demand, ad-free, for the entire family, and all of it inside the new Apple TV app.”

To call that an exaggeration would be charitable. Of the 26 channels that Apple has revealed so far, only CBS All Access provides the same programming you’d get from a standard cable channel. The remaining channels are premium add-ons (such as HBO and Showtime), digital-first streaming services (such as CuriosityStream and AcornTV), or scraps from cable networks’ back catalogs (such as Viacom’s NickHits and A&E’s History Vault).

TV networks still aren’t interested in selling their cable channels à la carte, or even offering all the channels they own as a single standalone package. Instead, they’re sticking to being part of bigger bundles (such as DirecTV Now and YouTube TV) while putting together streaming services with entirely different content from their cable offerings (like ESPN+). Apple has done nothing to shift this long-standing paradigm.

Problem 2: TV bundles still require their own apps

In lieu of offering individual cable channels, Apple TV lets you buy a bundle of them through third-party services such as DirecTV Now, Hulu with Live TV, PlayStation Vue, and FuboTV. You can then tie those services into Apple’s TV app that helps you follow your favorite shows and browse live sporting events in a single menu alongside video from other services.

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While this integration is nice to have, it’s not on the same level as the standalone channels that Apple just announced. You can’t use the TV app to set up DVR or browse live channels, and if you launch a video from a service like DirecTV Now, you wind up in a completely separate app with its own interface.

[Image: courtesy of Apple]
I still think there’s an opportunity for Apple to cut out the middlemen and distribute its own bundle of cable channels directly through the TV app. This would be an expensive endeavor, and would require more features within the TV app, but it would go a long way toward creating the kind of unified interface that the company keeps talking about.

Problem 3: Big streaming services dislike aggregation

Prior to Apple’s big event, Netflix CEO Reed Hastings said his company wouldn’t be part of the new channels service. “[W]e’ve chosen not to integrate into their service, because we prefer to have our customers watch our content on our service,” he said.

Hastings’s remarks were not surprising, as Netflix has a long history of avoiding broad platform-level aggregation and already refuses to integrate its Apple TV app with Apple’s universal guide. And given that Netflix recently turned off iTunes billing for new customers, it’s hard to imagine the company forfeiting a cut of its revenues to be part of the new Channels offering.

But while Hastings’s comments drew all the attention to Netflix, the same dynamics will apply to other large streaming services. Yes, Hulu and Amazon Prime promote content through Apple’s TV app, but launching a video still takes you into their respective apps. They’re not part of the new Channels service that lets you launch videos directly from Apple’s central menu. I wouldn’t be surprised if upcoming services from Disney and AT&T take a similar approach, or avoid Apple’s aggregation entirely. That means you’ll still have to do a lot of bouncing between different apps to watch all your shows.

Problem 4: Some content defies easy aggregation

Even if Apple successfully provided a single menu for all your movies and shows, that wouldn’t help with content that doesn’t fit neatly into the categories of movies and TV. Apple’s TV app, for instance, has no room for something like a “Let’s Play” video walkthrough on YouTube, or a live channels from a networked TV tuner such as Tablo. For those types of content–whether it’s on Apple TV or another streaming device like Roku–you’ll still have to fall back to a disconnected, standalone app (which is also how you watch the big anti-aggregators like Netflix). The idea of having a single, cable-like menu for streaming video is fundamentally at odds with all the kinds of video that streaming can offer.

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Problem 5: No bundle discounts (yet)

Because of all the above issues, there isn’t really a compelling reason to jump in with Apple TV Channels, at least not from what we’ve seen so far. While the service will add a degree of simplicity to billing and navigation, you’ll still need an array of other apps (sometimes with their own billing systems) to access everything you want in a post-cable world. And because Apple isn’t bringing its TV app to every platform (Google Chromecast, Android devices, and the web are notable omissions), you might be better off subscribing to services in other ways.

[Photo: courtesy of Apple]
There has been talk of Apple bundling multiple channels at a discount, and while that would almost certainly elicit howls about cord cutting becoming cable all over again, more flexible bundles would be a great way to boost the “Channels” concept that Apple, Amazon, and Roku are now pushing. For now, though, Apple hasn’t announced any pricing details for Apple TV Channels, and significant discounts seem unlikely, given what we’ve seen from existing services so far. (CBS, for instance, offers a measly $2 per month discount when you add CBS All Access to a standalone Showtime subscription.)

Apple deserves credit, at least, for its vision. Compared to what rivals like Amazon and Roku are doing, the TV app is the most thorough attempt yet at combining disparate streaming video sources into a simple, unified interface. But while Apple TV Channels aims to make things even simpler, it’s just another baby step.

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