Apple TV Adds HBO Go and ESPN
Apple has just recently announced that the company's streaming media is now featuring programs from Time Warner (TWC) Inc.'s HBO and Walt Disney Co. (DIS)'s ESPN. The services included live access to some of HBO and ESPN's sports channels.
For Apple TV users to enjoy the new feature, they must have an ESPN and HBO subscription from their local cable provider.
For ESPN's subscribers, some sports content will be available free of charge after authenticating their cable subscription.
For HBO's subscribers, Apple TV's service will be similar to HBO Go iPad application in which users can access the shows catalog and movies on demand.
Apple TV owners can now enjoy watching shows like "Sports Center, "Monday Night Football," "Games of Thrones" and "Boardwalk Empire."
According to a report from Bloomberg, Apple Inc.'s decision to add HBO and ESPN to the lineup of Apple TV is a great boost for Apple to fight the competition bottleneck with its strongest rival Roku Inc.'s device and Microsoft Corp (MSFT)'s Xbox.
As far as Time Warner and Disney's advantage is concerned, both companies obtained a strong ally to boost audience viewing. This was very beneficial for both companies since the audience viewing habits have shifted towards smartphones and tablets.
According to analyst Jaison Blair of Telsey Advisory Group, "It is an indication of where the industry is headed. The consumer is increasingly going to demand that their content is available on all devices."
However, even with this good news, Apple still faced the challenge of convincing media companies. For the moment, Apple TV's offering of HBO and ESPN is limited to users of U.S. cable industry.
The media companies that own HBO and ESPN's content were apprehensive that Apple TV's streaming services might not generate enough revenue for the companies to recover from the possible lost cable subscriptions.
In relation to media companies' apprehension, Mr. Blair hinted that they have grounds to doubt Apple's move, "The cable bundle is relatively well protected... (but) the status quo carries risks for media companies and cable providers as subscribers become increasingly frustrated by rising monthly bills. Content producers keep increasing license fees, with costs passed to subscribers. The programmers are killing the golden goose."
In addition to HBO and ESPN, Apple TV will also be featuring content from News Corp. (NWSA)'s Sky News Channel, Crunchyroll (distributor of content from East Asia) and Quello (cable channel featuring concerts and music documentaries).
Apple TV is priced at $99. It mainly streams content from iTunes and other shows online. However, Apple TV's revenue had failed to attain the huge revenue that iPad and iPhone is bringing the company. Since Apple TV's launch in 2007, it has sold just more than 13 million units. The big bulk of this figure came from purchases made in 2013.
In fact, in October 2012, during the earnings call with investors, Apple CEO Tim Cook said that 5 only million Apple TV's were sold in 2011.
Mr. Cook explained that, "It (Apple TV) still has the hobby label, however, it is a beloved hobby."