Apple's subscription TV service predicted to cost below $40 to compete with cable providers

Posted:
in iPod + iTunes + AppleTV edited April 2015
With Apple's anticipated subscription television service said to be targeting a price between $30 and $40 per month, one analyst has predicted that the company will come in on the low end of that range, or else risk pricing itself out of the market.




Rod Hall of J.P. Morgan issued a note to investors on Wednesday, a copy of which was provided to AppleInsider, in which he said a $40-per-month price tag for a subscription TV service would be too high.

In his view, the incremental cost of cable television service from a provider like Comcast, in addition to basic Internet, is less than $40 per month. And so if Apple were to exceed the price of a basic cable package, there would be very little reason for consumers to "cut the cord" and go with a streaming-only solution from Apple.

The rumored price range for the service was first reported on Monday by The Wall Street Journal, which said that Apple could launch the service as soon as September with prices ranging from $30 to $40 per month. At those prices, it would be more costly than the already-available Sling TV from Dish Network, priced at $20 per month.

A key factor in pricing, of course, is exactly what channels Apple's service would offer. Reports have suggested that Apple is in talks with broadcast networks ABC, CBS and Fox, as well as other cable networks owned by Viacom and Discovery, though apparently talks have stalled with Comcast-owned NBC.

But if other content owners forge a deal with Apple, Comcast could find itself forced to play along, based on the terms of the deal it reached with the U.S. Federal Communications Commission in 2011 to purchase NBCUniversal. The final judgment rules that Comcast must treat online video services as essentially equal to cable companies.

Beyond a subscription TV service, Hall has also predicted that Apple will launch new Apple TV hardware, potentially with the same A8X chip found in the iPad Air 2. He believes it would be accompanied by a new App Store for the Apple TV that would allow users to download games and other content, competing more directly with modern game consoles like the Xbox One and PlayStation 4.
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Comments

  • Reply 1 of 127
    supadav03supadav03 Posts: 327member
    Sony's Playstation Vue allows for DVR through cloud storage, although it is only storable for 28 days. They also offer the last 3 days of live programming On-Demand. I could see Apple doing something similar with thier service.
  • Reply 2 of 127
    apple ][apple ][ Posts: 8,360member

    This sounds interesting and could be a game changer, depending upon which channels and what content is going to be available for it.

     

    I still subscribe to cable, and I also have other online subscriptions like Netflix, but I look forward to seeing exactly what this Apple service will be offering.

  • Reply 3 of 127
    mystigomystigo Posts: 97member
    Apple could make it free and it would make no difference. Comcast caps our data usage at 300 GB a month, which we struggle to stay under even now. Comcast demands $10 tribute for each additional 50 GB beyond 300. We would end up paying way more than $30 a month if we used AppleTV as our primary media delivery system.

    Comcast and the corrupt politicians that let them get away with this need to be taken down.
  • Reply 4 of 127
    apple ][apple ][ Posts: 8,360member
    Quote:
    Originally Posted by sog35 View Post

     

    Can't wait.

     

    To me the WORST part about CableTV is the HORRIBLE cable boxes they give you.  Most of them are POS and old as hell.  Yet the still charge you $20 a month, EVERY MONTH per box.  Also horrible is the user interface.  Straight from the 1990's.  So aweful.

     

    With AppleTV that will end.  

     

    Things I'm looking forward to with AppleTV:

     

    1. Cheaper.  Pay $30 instead of $90

    2. Better user interface.

    3. Own your own equipment instead of paying $20 a month for POS crap

    4. Better picture quality

    5. Watch anywhere with iPad/iPhone (TimeWarner does not allow this)

     

    But what about DVR?  The ultimate is if you don't need a DVR and you can simply stream shows from the past few days.




    You mentioned Time Warner, so I assume that that's what you use. I'm also on Time Warner.

     

    If you want a brand new cable box, just take your old box to a Time Warner store and exchange it for a new one, it doesn't cost anything. I've done that a few times already with my boxes. The new box that I have allows it to be controlled by my iOS devices. It's much better than using their horrible remote.

  • Reply 5 of 127
    solipsismysolipsismy Posts: 5,099member
    And that means packages, whether you like it or not, unless you think Apple is going to change you 16¢ per channel so that all channels come out to below $40.

    sog35 wrote: »
    Can't wait.To me the WORST part about CableTV is the HORRIBLE cable boxes they give you.

    They are bad. I think I've had this discussion several times with [@]mstone[/@] over the years.
  • Reply 6 of 127
    alainhalainh Posts: 1member
    This is a great idea but, for those of us with slower broadband connections, it becomes almost unusable. Also half the time I have used the existing service it takes forever to use and the logins for the different accounts are erratic at best. I have had to re-enter them 3 and 4 times before they work once and then the next time having to re-enter them again. Not a great experience at all.
  • Reply 7 of 127
    mystigo wrote: »
    Apple could make it free and it would make no difference. Comcast caps our data usage at 300 GB a month, which we struggle to stay under even now. Comcast demands $10 tribute for each additional 50 GB beyond 300. We would end up paying way more than $30 a month if we used AppleTV as our primary media delivery system.

    Comcast and the corrupt politicians that let them get away with this need to be taken down.

    While I think unlimited should be standard for land connections, how on earth do you bump up on 300gb a month?? That's 10gb downloaded per day. I didn't realize it was possible to consume that much data.
  • Reply 8 of 127
    apple ][apple ][ Posts: 8,360member
    Quote:

    Originally Posted by GregInPrague View Post



    While I think unlimited should be standard for land connections, how on earth do you bump up on 300gb a month?? That's 10gb downloaded per day. I didn't realize it was possible to consume that much data.



    Streaming HD movies can eat up a bit of bandwidth.

     

    And maybe somebody downloads Blu-Ray rips, that can be more than 10 GB for one movie.

  • Reply 9 of 127
    mike1mike1 Posts: 1,588member
    Quote:

    Originally Posted by sog35 View Post

     

    Can't wait.

     

    To me the WORST part about CableTV is the HORRIBLE cable boxes they give you.  Most of them are POS and old as hell.  Yet the still charge you $20 a month, EVERY MONTH per box.  Also horrible is the user interface.  Straight from the 1990's.  So aweful.

     

    With AppleTV that will end.

     

    Things I'm looking forward to with AppleTV:

     

    1. Cheaper.  Pay $30 instead of $90

    2. Better user interface.

    3. Own your own equipment instead of paying $20 a month for POS crap

    4. Better picture quality

    5. Watch anywhere with iPad/iPhone (TimeWarner does not allow this)

     

    But what about DVR?  The ultimate is if you don't need a DVR and you can simply stream shows from the past few days.


    Unfortunately, streaming does not typically let you skip through the commercials like a DVR does. There are other benefits to a DVR as well. I can watch recorded TV if my cable internet happens to go down. The pause, fast forward and rewind functions are instant and much more responsive.

  • Reply 10 of 127

    Last year when everybody at home started to use Netflix the data usage went through the roof.  I have Comcast and due to the data cap I had to cancel Netflix. I would really like to use Apple's new offering but I am afraid that I won't be able to afford the overage charges for data.

  • Reply 11 of 127

    I don't. I use an over the air antenna and  I just have comcast for internet.

  • Reply 12 of 127
    pt123pt123 Posts: 696member
    Quote:

    Originally Posted by sog35 View Post

     

    1. Cheaper.  Pay $30 instead of $90


    For $30, we should expect $30 worth of programming. A fair assumption as online video must be treated equal to cable companies.

  • Reply 13 of 127
    cpsrocpsro Posts: 2,305member

    If the service doesn't offer at least everything a DVR does, then what's the point of paying so much just to be trapped in a different hell?

  • Reply 14 of 127
    mystigomystigo Posts: 97member
    Quote:
    Originally Posted by GregInPrague View Post





    While I think unlimited should be standard for land connections, how on earth do you bump up on 300gb a month?? That's 10gb downloaded per day. I didn't realize it was possible to consume that much data.

    There are 4 people in my family and I work from home. That is only 2,500 MB a day each. Everyone has one computer and one laptop running both Windows and Mac OS X, and everyone one has or more handheld devices. Just the operating system updates alone put a huge dent in the 300 GB number. We literally watch no more than one or two movies a month through Apple TV. The rest of the bandwidth are game updates, new games, audio and video streaming (like YouTube for example -not full fledged sit down and watch TV streaming). With 4 tech savvy people it is a constant struggle. There is no way we could add streaming TV to that. Not even close.

  • Reply 15 of 127
    I'm sitting at 174 gig with now with almost half the month to go. Got 4 your adults netflixing (is that a word?) and gaming. I work from home for a software company. Wife is a Hay Day addict on her iPad. 10 computers 6 iPhones and 3 iPads. 300 gig is no big deal.
  • Reply 16 of 127
    davendaven Posts: 453member
    Quote:

    Originally Posted by sog35 View Post

     

    Can't wait.

     

    To me the WORST part about CableTV is the HORRIBLE cable boxes they give you.  Most of them are POS and old as hell.  Yet the still charge you $20 a month, EVERY MONTH per box.  Also horrible is the user interface.  Straight from the 1990's.  So aweful.

     

    With AppleTV that will end.  

     

    Things I'm looking forward to with AppleTV:

     

    1. Cheaper.  Pay $30 instead of $90

    2. Better user interface.

    3. Own your own equipment instead of paying $20 a month for POS crap

    4. Better picture quality

    5. Watch anywhere with iPad/iPhone (TimeWarner does not allow this)

     

    But what about DVR?  The ultimate is if you don't need a DVR and you can simply stream shows from the past few days.




    Here is a pricing option. $30/month for the package in HDTV. $40 for the package in 4k.

  • Reply 17 of 127
    troehltroehl Posts: 30member

    The thing that I'm really waiting to see is how well it will support "flipping" through channels. Right now the Apple TV is designed assuming that you know what you want to watch and you navigate down to wherever you need to get to watch that content. It's the exact opposite of the way most people watch TV.

     

    Also, the big problem that no one has seemed to have solved yet is how to manage all these separate inputs with one box. If I'm watching TV for example and want to switch over to the Apple TV it still takes me two remotes to do it (and yes, one of them is a smart remote otherwise it would take three remotes!)

  • Reply 18 of 127
    drewys808drewys808 Posts: 524member

    So...

     

    - What will happen to existing Apple TV? Discontinued this year? Still offered as a lower tier device? I say the latter.

    - Will there be a new Apple TV this year? Will it have DVR capability as an option? I say yes to both.

    - Will broadband providers revise their plans to more strictly cap data speed/amount, i.e. complicate with pricing tiers? Probably yes.

  • Reply 19 of 127
    bill42bill42 Posts: 115member
    Quote:

    Originally Posted by sog35 View Post

     

     

    Paying so much?  The average cable plan with HD-DVR boxes is close to $100.  

     

    How is paying $30 the same hell as paying $100?

     

    Apple will figure out something with DVR.  Its not rocket science.  DVR has been around for ages.


    I pay around $120 for cable, land line, and internet. Standard Triple Play discount. If I cancel cable part, then internet alone jumps up to $60 or more. Add that to your $30 AppleTV bill….

  • Reply 20 of 127
    troehltroehl Posts: 30member
    Quote:

    Originally Posted by drewys808 View Post

     

    So...

     

    - What will happen to existing Apple TV? Discontinued this year? Still offered as a lower tier device? I say the latter.

    - Will there be a new Apple TV this year? Will it have DVR capability as an option? I say yes to both.

    - Will broadband providers revise their plans to more strictly cap data speed/amount, i.e. complicate with pricing tiers? Probably yes.




    Apple TV will never have DVR capability. Ever. From Apple's point of view why would you ever want to mess around with recording schedules and culling repeats and all kinds of other hassles when you can just on-demand watch the episode that you want from the cloud? Other than possibly pausing live-tv it's unnecessary.

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