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How Apple plans to bankroll its rumored game-changing TV streaming service

Apple TV Streaming

Amid reports that Apple is planning to roll out a $30-$40 TV streaming service this fall, Re/Code reports that Apple is hoping that TV networks will handle the infrastructure costs involved in rolling out such an endeavor.

What this means, in a nutshell, is that Apple doesn’t want to actually serve the streams from its own servers, but rather provide the hardware and software that TV networks can tap into. While this may seem, at first glance, like Apple is trying to protect its pocketbook, it’s worth noting that many of the content providers Apple is reportedly talking to already manage their own streaming infrastructure.

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That said, if a streaming Apple TV service takes off, bandwidth issues may very well arise for whatever party or parties wind up responsible for keeping things running smooth on the backend.

Streaming video costs aren’t prohibitive: Delivery to your living room runs an average of around five cents per hour per stream, says Tom Morgan, a video industry veteran now running streaming service Net2TV.

That said, outside of Netflix, which streams billions of hours of video every three months, most streaming services haven’t experienced significant demand to date. The notion of paying their own freight for a heavily promoted Apple service has given executives pause, sources say.

All in all, it’s an interesting talking point which only serves to underscore the complexities involved in getting a streaming service up and running. If Apple’s rumored TV service does in fact launch this fall, Apple won’t be afforded the luxury of withstanding a subpar user experience unscathed. Consider this: Netflix users might be frustrated at a sluggish stream when they’re trying to watch a movie or House of Cards. Now imagine how consumers paying $40 a month will feel when their Apple TVESPN stream starts coming in choppy during the 4th quarter of a close basketball game.

Yoni Heisler has been writing about Apple and the tech industry at large for over 15 years. A life long Mac user and Apple expert, his writing has appeared in Edible Apple, Network World, MacLife, Macworld UK, and TUAW. When not analyzing the latest happenings with Apple, Yoni enjoys catching Improv shows in Chicago, playing soccer, and cultivating new TV show addictions.