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Cable Operators

Apple In Talks With TWC, Other MSOs On Cable Set-Top: Report

8/15/2012 10:40 PM Eastern

Apple has approached Time Warner Cable and other large cable operators about creating an Apple-developed set-top that would let subscribers access TV programming, The Wall Street Journal reported, citing anonymous sources.

Apple and Time Warner Cable representatives declined to comment on the report.

Apple, the largest technology company in the world, does not appear to have reached a deal with any MSOs, the Journal said, speculating that operators may be reluctant "to let Apple establish a foothold in the television business."

Whether Apple would sell such a cable-ready box at retail or only distribute it through MSOs is not clear. Apple has raised the possibility of being the "exclusive" provider of IP-based set-top boxes for MSOs, which would supply them to customers, the Journal reported. In the past, operators have balked at Apple's demand for a 30% cut of transactional content revenue, according to the paper.

Apple already sells a $99 set-top, the Apple TV, but it provides access only to Internet video services, including iTunes, Netflix, YouTube and Hulu Plus. The Journal said it was unclear whether a version of the Apple TV or a more powerful device are the subject of the discussions with MSOs.

The company sold 4 million Apple TV set-tops over the last three quarters. Apple CEO Tim Cook, on the company's earnings call last month, said, "It's still at a level that we would call it a hobby" but added, "we're not one to keep around projects that we don't believe in."

Meanwhile, Apple has been rumored to be developing an advanced Internet-connected TV set. The technology in a cable-ready set-top could be embedded in a television, the Journal reported.

Separately, on Tuesday the U.S. Patent & Trademark Office granted Apple a patent covering an on-screen TV menu that determines what controls to display based on the type of content being viewed.

 

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