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Apple TV: Third time unlucky, Mr Jobs

Going down for the last time

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Comment This is the day that Apple lost the war for Over The Top content, not only in America, but globally. The winner can’t yet be announced, but this was the shot that Apple had to get it right, and to us it’s bungled it.

We got the same story from Apple, Amazon and Sony all at the same time and a similar one from Google. And while Apple got all the plaudits, US consumers are not easily taken in. Even though Apple fan boys will go on and on about this product, which is the third generation of Apple TV, in our view it's likely to be a dud.

That’s pretty much the opposite of how the US-centric, Apple-loving press dealt with the $0.99 per TV show story, because it was orchestrated by Apple alongside a revamped iPod line, as the re-emergence of Apple TV in its September 1 announcements.

We’d like to put a different spin on this, one where we give more credibility to the major US broadcast networks, and one which may have eventually create a global effect and something of a content divide. Fox and Disney have tossed around an old idea of Apple’s (about two years old) to lower the price of downloaded TV series to $0.99 from $1.99, and to allow them to be streamed.

But instead of launching it only with Apple, they are going to let everyone who can meet their terms join in. Potentially this could eventually include Google, though we must remember that most of the content businesses (studios) who supply the broadcast networks with content, hate Google passionately because of YouTube and its $1bn lawsuit for showing Viacom copyrighted content.

But it certainly includes Amazon, who also launched, or at least admitted to, a similar service yesterday. It could also stretch to include Sony, which today made it clear that its new Qriocity (pronounced Curiosity) music and video store, would go directly up against iTunes. Netflix itself may also later avail itself of much of the same content directly, as could TiVo and any of these would howl to the courts if anyone told them they could not have it at the $0.99 price.

What Apple appears to have done is turn this move by the two major broadcast groups into something that was a PR victory for its Apple TV, which it relaunched on the back of the deal. The fact that other Apple rivals were able to announce the same details and the same pricing, and the same streaming approach, cannot be a coincidence.

It has long been one of Faultline’s contentions that large content groups made up of multiple media businesses cannot offer one set of terms to a company like Apple and higher or different terms to other rivals – partly due to antitrust, partly out of fear of backing the wrong horse, but mostly out of the desire to not make enemies.

This whole thing is part of broadcast versus cable, and a way that two of the four major US national broadcast networks can instigate a new source of revenue. The other two networks – CBS and NBC we expect will follow, but after a sensible amount of time to make it look like it clearly was not a cartel move, even though it probably was orchestrated across all of them.

So what does that leave Apple with? It has a set top out for $99 called the new Apple TV. But Roku had a $99 set top out two years ago for Netflix movies, and Google has yet to price its set top, which may perhaps drop as low, if not lower than that $99.

Apple has HD content. Well, other OTT services have HD, but one or two have 1080p and Apple is offering 720p. Apple does have the ability to stream from your Apple TV not only to a TV set, but also (across its own brand WiFi we presume) the ability, with the next release of its iOS sometime around November, the opportunity to view the streams on other portable Apple boxes, such as the iPhone, iPod Touch, or iPad, from the Apple TV. Well that’s just a function of them having the same DRM system, and others may too offer that, at some stage, with Android handsets.

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