While Apple Inc. (NASDAQ:AAPL) has not said much, if anything, publicly about getting involved in digital television, there has been all kinds of talk about an AppleTV set-top box upgrade or going all the way to an actual television set. Stories have floated around lately about Apple talking about its set-top box with a couple of the major cable companies, trying to find an opportunity for Apple to get into the television and movie world besides through smartphones and tablets.
Apple Inc. (NASDAQ:AAPL) wants to get into the American living room. But right now, it has to go through the cable companies, Google Inc. (NASDAQ:GOOG) and Cisco Systems Inc. (NASDAQ:CSCO) to get there. You see, Apple TV has been out for a short while but has not yet made a dent in the set-top box market which is under firm control of Motorola Mobility, now owned by Google; and Scientific Atlanta, a subsidiary of Cisco. And without dedicated programming (other than through iTunes), the idea of a television set seems impractical for Apple Inc. (NASDAQ:AAPL) at this point.
One piece analyzes how an Apple TV box might work under the current landscape, which of course is tenuous since cable companies do not want to give up content that might be viewed later for free. There was talk as far back as 2009 that Apple was developing a TV subscription service through iTunes that would be about $30 a month. Now, though, the talk has been that the current set-top box concept would provide easier access to the programming users want, and could blur the lines between live and recorded content. And ultimately, the idea would be that the content that goes through the Apple TV box could then be synced and accessed via any device – laptop, desktop, smartphone or tablet. The challenge is convincing cable companies to forgo a little bit of their licensing control.
However, another piece explores another way Apple Inc. (NASDAQ:AAPL) can get into television, and it would be quicker and easier: buy TiVo. The reasons? TiVo could be bought for $2 billion; TiVo provides quite a bit of intellectual property value; cable companies already have deals with tiVo; and production of the boxes would be cheaper because Apple has such a large supply chain. The one rub – an intellectual-property lawsuit between TiVo and Verizon Communications Inc. (NYSE:VZ) that starts next month. If TiVo can win a settlement, then Motorola and Cisco may settle too, and a worldwide settlement would hike up TiVo’s value.
There are a couple of interesting scenarios – Apple Inc. (NASDAQ:AAPL) looking to cooperate with the current environment, or jumping out on its own – s has been its tradition – and jump into its own TV entity through acquiring a company that is already inside the environment. This will be something to watch over the next several weeks and months.