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Even Apple is jumping on the cord cutting train

Updated Aug 2nd, 2018 5:11AM EDT
Apple TV subscription service
Image: YouTube

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Cord-cutting, as we’ve said endless times before, is happening faster than anyone could have anticipated. Every quarter brings another round of dismal news for cable and satellite TV providers, who are watching their cash cow vanish before their eyes, replaced by a cut-throat world of streaming TV subscriptions that barely make any money.

With the change comes an opportunity for outsiders to get a foothold in the wildly profitable entertainment market, and one of the biggest stealth players is Apple. The company has been rumored to have some kind of TV play in the works for nearly a decade — who can forget the fervent Apple HDTV rumors — but on Apple’s most recent Q3 earnings call, CEO Tim Cook hinted strongly that we’re going to see results sooner rather than later.

“As you know, we hired two highly respected television executives last year and they have been here now for several months,” Cook said in response to a question from Monness, Crespi, Hardt’s Brian White. The TV execs in question are likely Jay Hunt, a top British TV exec, and Carol Trussell, a former Gaumont Television exec who now serves as Apple’s Head of Production. The TV efforts are overseen by Zack Van Amburg and Jamie Erlicht, two former Sony execs who moved to Apple last June.

“[They] have been working on a project that we’re not really ready to share all the details of it yet, but I couldn’t be more excited about what’s going on there and we’ve got great talent in the area that we’ve sourced from different places and feel really good about what we will eventually offer,” Cook continued. With Apple’s moves to acquire production talent and execs with deal-making experience in the industry, the consensus is that Apple is ramping up to offer its own streaming service, which might integrate a mix of original content, licensed video-on-demand, and perhaps live TV streaming services.

“In terms of the sort of the key catalysts and the changes, the cord cutting in our view is only going to accelerate and probably accelerate at a much faster rate than is widely thought. We’re seeing the things that we have on the periphery of this like Apple TV, units and revenue grew by very strong double digits, very, very strong double digits in Q3,” Cook said. He went on to describe how Apple has been seeing its Apple TV set-top box used by existing streaming services as an alternative to traditional cable boxes, which perhaps indicates where Apple wants to position itself in the market. If the company can make its hardware platform commonplace, it can become the common market for streaming services, backed by Apple’s own original content for video-on-demand services. That could keep Apple out of directly competing with cable companies (for now) while also enabling it to skim a small percentage of subscription revenue off the growing cord-cutting market.

Chris Mills
Chris Mills News Editor

Chris Mills has been a news editor and writer for over 15 years, starting at Future Publishing, Gawker Media, and then BGR. He studied at McGill University in Quebec, Canada.