The Race Is on for Skinny TV
Now that Dish has successfully launched its pared-down Sling TV service, the rest of the programming and distribution world is scrambling to match up skinny TV bundles with Internet-only delivery. (See Sling TV – Like Pay-TV, but Skinnier.)
Cablevision Systems Corp. (NYSE: CVC) announced this week that it will be the first pay-TV provider to offer HBO Now paired with broadband service, and Apple Inc. (Nasdaq: AAPL) is once again in the headlines for rumored plans to launch an online video service this fall with a smaller channel line-up than traditional cable TV bundles. (See Cablevision Takes HBO Now.)
The HBO Now service follows a path that Home Box Office Inc. (HBO) carved out with its original HBO Go product. While the multiscreen HBO Go service is only available for pay-TV subscribers, HBO Now is designed to be offered as a standalone video product bundled with specific hardware or Internet service. Apple jumped on the bandwagon last week announcing that it would be the first partner for HBO Now, but Cablevision is joining the party and says it has reached an agreement with HBO to become the first cable company to offer the programmer's new product. There's no word on pricing yet for Cablevision subscribers, but HBO Now is retailing with Apple for $14.99 per month. (See HBO Now Goes With Apple for Now.)
Although HBO is technically a single programming entity, the breadth of the company's content makes it a TV bundle in its own right. With original programming, blockbuster movies and a significant library of back-catalog content, HBO Now is a video service more akin to Netflix Inc. (Nasdaq: NFLX) than a single à la carte network offering like CBS Corp. (NYSE: CBS)'s CBS All Access. (See CBS Takes OTT Plunge.)
Also on the horizon for skinny TV bundles, The Wall Street Journal is reporting that Apple is planning an online service for later this year that is expected to include roughly 25 television channels and may cost in the range of $30 to $40 per month. Rumors that Apple would get into the TV service business have been swirling for years, but, with programmers increasingly willing to negotiate with online distributors, the environment for doing so is more favorable now than at any time in the past. (See Is Apple Pursuing OTT Again?)
According to the Journal, Apple is in talks with Walt Disney Company, CBS and 21st Century Fox about content licensing. NBC Universal is currently not in the mix after Apple and NBC's parent company Comcast reportedly had a disagreement over video service plans last year.
— Mari Silbey, special to Light Reading