Apple's (NASDAQ: AAPL) plan to release a major upgrade of its over-the-top device, Apple TV, has apparently hit a snag, with the Cupertino, Calif., technology giant stuck in an impasse on content rights.
According to a report in The Information, Apple's inability to come to terms with programmers and pay-TV operators means a new version of Apple TV won't debut until at least 2015. Tech pundits, bloggers and other various Apple watchers had expected a new version of the device to arrive no later than Q4 2014.
"Apple engineers who are working on aspects of the device have been told by their bosses not to expect a launch this year and are working off timelines that assume a launch next year," reads the report, citing unnamed Apple sources.
According to The Information, Apple employees accuse programmers of cable networks and pay-TV operators of "dragging their feet" in content rights negotiations, with pending pay-TV mergers (notably Comcast/Time Warner Cable) fueling the delay.
For the past several years, Apple reportedly has been selling programmers and operators on a new TV service that would be focused on the Apple TV set-top box but use the infrastructure of cable services. Apple's plan is to make all programming available on demand using cloud-based storage, and it believes it has developed the technology needed to execute this scheme.
Top cable operators, notably Comcast (NASDAQ: CMCSA), have listened carefully to Apple's pitch, as they look to stem video subscriber losses. Comcast and Apple have even progressed to advanced talks on the matter, according to reports.
But according to The Information, cable operators on the whole remain reluctant to "leave an opening for Apple, which they fear could displace them as the brand that customers associate with television delivery. And they also remain committed to their own new devices and experiences."
Meanwhile, programmers that already have deals with Apple through its iTunes initiative remain "uncertain about what type of business model makes sense for them."
The Information also quotes anonymous executives from programming networks and pay-TV operators, who say Apple has "bitten off more than it can chew" and lacks understanding of the complex, multi-layered nature of TV video content licensing.
- read this report in The Information (subscription only)
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