Time Warner CEO Says No Way to iTunes TV Rentals

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Jeff Bewkes, Time Warner CEO, isn’t interested in Apple’s US$0.99 iTunes Store TV show rental program because he sees it as a platform that will hurt broadcast partners.

“How can you justify renting your first-run TV shows individually for 99 cents an episode and thereby jeopardize the sale of the same shows as a series to branded networks that pay hundreds of millions of dollars and make those shows available to loyal viewers for free?” Mr. Bewkes said during the Royal Television Conference in London, according to The Hollywood Reporter.

Apple introduced its low cost TV show rental program for the iTunes Store during an iPod and media-related press event in early September. ABC, ABC Family, Fox, Disney Channel and BBC America are already on board, but NBC Universal isn’t interested in participating.

Time Warner isn’t singling out Apple. Mr. Bewkes doesn’t have any plans to strike any deals with Amazon, either, because he thinks offering lower cost content through both companies services would devalue shows.

Despite Mr. Bewkes disdain for Apple’s streaming rental service, that isn’t stopping him from offering TV shows for sale through the iTunes Store. Presumably he doesn’t see selling TV shows through the iTunes Store as a threat to the networks that are buying his content.

Comments

Ted Landau

Oh yes. I see his point.

Renting shows in iTunes for $0.99 would totally destroy Time-Warner and its branded networks. Completely. Utter devastation. Only a fool would even consider such a move.

Selling shows for $1.99 or $2.99? That’s a totally different animal. This makes complete sense and is obviously a winner for Time-Warner and its networks.

Jeff Bewkes like totally gets it.

Intruder

I seriously doubt that rental through Amazon or Apple would affect the broadcast companies that much. I think he’s just passing up another possible revenue stream. But hey, that’s his choice.

Jamie

I’m wondering if all of this is another coup against iTunes and Google tv will debut with rentals. Meanwhile, I think most people would totally pay 99 cents for a show they’d like watch once; any more than that is insanity when there are so many *ahem* other sources for tv content.

b9bot

So rediculous!  Selling shows is okay but renting somehow makes them lose money. How? Wouldn’t renting just add another stream of revenue for them. I don’t know how this could be a negative.

bucknut

Industry executives are desperately clinging to an old and dying paradigm. Todays business model is going the way of the incandescent light bulb. The first to acknowledge and embrace the change will be the ones who survive and thrive. You can’t invest in new ideas when you invest all your energy in keeping the status quo. Todays youth will not now, or ever, be paying $160 a month to content providers for the privilege of viewing 1st run TV shows.

Jeff Gamet

This feels more like a power play on the part of Time Warner. I think they don’t like the idea of Apple being in control of part of the distribution stream. Of course, TW isn’t bothered by that too much, otherwise they wouldn’t sell content through the iTunes Store.

Bob.Witte

I have to quick check my Time Warner cable bill! I must have missed the “free” part of cable, not to mention all of the commercials….

“make those shows available to loyal viewers for free?”

Bosco (Brad Hutchings)

OK, let me be the first to say “TW content sucks anyway. Charles Barkley is fat-ass drunk. Apple is better off without them.”

I kid, but I know how this works now.

[EDIT:] Oh, Jeff figured it out. Well, after the Zucker episode, we have progress in our ranks. Now that we’ve got that down, the next question is Why are the uncomfortably with Apple having control? And the answer to that is Steve Jobs. When he is out the door, they’ll talk to Apple again.

jfbiii

Given that tradeoff, it’s not snarky at all to say, “Apple is better off without them.” Because the only people better off without Steve Jobs at the helm of Apple are Apple’s competitors.

Bosco (Brad Hutchings)

Any of the old-timers here remember when Apple was about making things easy and bringing things together?

Intruder

Ummm… He also isn’t giving it to Amazon either. So does that mean when Bezos leaves he’ll talk to Amazon? Or is the Steve Jobs effect spilling over onto Amazon? I’m sure he’d be pleased that he has that much influence. Or is it maybe they don’t want to upset the current paradigm?

And the Zucker episode? You mean the guy who is being forced out of NBCU? Don’t know about the future management team from Comcast, but what Jeff Zucker thinks or feels is about to become completely irrelevant.

Not every move is about Steve Jobs.

skipaq

Any of the old-timers here remember when Apple was about making things easy and bringing things together?

Since I have been buying Apple products starting back before there was a Mac, I guess that qualifies me. I can say with absolute certainty that Apple today is at its’ best. Their products now are easier to use and they are better supported by developers and hardware manufactures.

Not only that, but Apple uses more standards based I/O, media and networking solutions than at the beginning or during the 1990s.

As far as bringing things together; I would conclude that they are better at it then at any time in their past. This isn’t to say that they can’t do better; but so could you I am sure.

Your personal venom toward one person must be poisoning you from the inside out. If your predictions had come to pass Apple’s stock would have tanked by now and Jobs would have been fired long ago. If your happiness depends on Jobs’ failure and the demise of Apple’s way of doing things, you need to re-evaluate your motives.

Bosco (Brad Hutchings)

Right skipaq, like the iPad’s ability to play Flash content in the browser, like more than 97% of devices connected to the Internet. Like having an SD card slot on iPad or iPhone so users can get content on and off the devices without anchoring to a computer. etc.

My happiness doesn’t depend on Jobs or Apple failing. However, you guys here fail to consider that he is the biggest liability to Apple being a cooperative partner in these markets. On the stage, he’s a combination of Jesus and Santa Claus. Behind closed doors, he’s as ass, and it’s well chronicled. The RDF is wonderful for $99, $999, and $1999 price points. But at multi-million dollar price points, it’s more WTF, and there is a lot of WTF going on in content industries about putting Apple into the mix in a way that cedes any control to Apple. The rise of Android ought to show you that cool is a niche that’s quickly and easily captured. Galaxy Tab, Streak, PlayPen, and PalmPad will do the same for tablets in the coming months. Apple has to play up the value chain (i.e. content), but they don’t know how to act like a partner. Apple is more focussed on creating walls for its gardens, than on bridges that unite.

FlipFriddle

As someone who bought Apple stock when it was at $14 I am not seeing this “liability” you speak of. Looks like they are moving along just fine.

skipaq

Bosco, I’ve never seen Jobs on stage and could care less to do so. I’ve never met the man, let alone spoken with him. And I never judge a person based on what someone else has to say. It may be well chronicled what he is like to work for or with. I have worked for and with a lot of people that were not enjoyable to be around. That never resulted in my wishing them ill or failure.

When you speak of technical matters or issues I pay attention to what you have to say. When you go on one of your personal tirades it only detracts from your credibility. Based on Apple’s business prospects I cannot accept your evaluation of Jobs’ being a liability.

Now, if you really believe that Apple’s old way of everything being proprietary right down to Appletalk, ADB and more was better than now then you are really stuck in the past. You asked a question. I gave an honest and accurate answer. Don’t you even remember what it was like to get a Mac to connect to just about anything outside of Apple?

Is everything the way I want it? No. But I’m not going to take a tantrum every so often; I’ll just buy what best fits my needs. I don’t need or want Flash on my phone. I don’t own an iPad. The iOS products and infrastructure are still developing.

Why wouldn’t I want to see Android succeed? I don’t want to see Apple become the only supplier of tech goods any more than I want to see Wal-Mart be the only store in town. Not difficult to understand. For some things I like Apple’s garden just fine. For other things I go elsewhere.

Tiger
jfbiii

“Apple is more focussed on creating walls for its gardens, than on bridges that unite.”

Apple unites customers with quality products. None of those customers gives a shit whether Adobe or some piss-ant developer with a chip on his shoulder and an unearned sense of entitlement are upset because someone dared tell them “no.”

There isn’t a version of Flash that can run on an iPad…Adobe hasn’t been able to deliver a mobile version of Flash that meets Apple’s needs for how many years now? Oh yeah, more than 3 years.

If you want an SD slot in a tablet, than buy a slate with an SD slot. Oh wait…that’s right…there isn’t a slate-style product on the market of any value besides the iPad.

And it’s not just Apple who isn’t delivering the products that Brad wants. Take a look around: nobody is delivering the products that Brad wants. Be pissed at Dell for not making a tablet with an SD card. Be pissed at Microsoft for not offering a real mobile OS that would happily play Flash content with no concern at all for battery life. Be pissed at HP and RIM for not coming up with a product category that makes Apple play catch-up for a change. Be pissed at all those vendors who don’t have the ability to create a garden of any comparative worth next to Apple’s, much less a walled one.

You think Android is stealing teh “cool?” LOL. They’re stealing market share by selling cheap imitations at cheap imitation price points and very little profit. If that’s “cool” then I’ll rent you the truck you can haul it away in.

Bosco (Brad Hutchings)

skipaq, At some point, Apple can’t wrap machined aluminum around something, set a trend, and maintain a 1-year first mover advantage. Apple cannot supply everything its customers want in the garden. It has to pragmatically accept that there are channels and content sources that it needs to include to be relevant. While the point may be difficult to make for software when Apple can claim over 200K iOS titles, it ought to very clear with content when Apple can’t claim Caprica or The Closer.

It is very likely as of now, that a little upstart, Roku, will beat Apple for that second box position. This despite what Engadget noticed as superior presentation of 720p video by Apple TV and quicker play time for downloaded content, i.e. Apple probably has the better technical implementation. Roku, however, supports a vast range of formats that video can be found in, supports DLNA so you can share from most new phones, and has lined up more and better content partnerships.

Would someone please offer a better explanation of this situation than “the content providers do not trust Apple”. If I can convince you of that this afternoon, I’ve accomplished more than I’d ever imagined. The reason they don’t trust Apple will become clear to you another day. Hint: Steve Jobs doesn’t know how to behave like a partner, and he can’t just wrap aluminum around this problem.

Bosco (Brad Hutchings)

Be pissed at Dell for not making a tablet with an SD card.

Dell Streak has a user accessible Micro-SD card slot that comes standard with a 16GB card. Samsung Galaxy Tab has a card slot. Even the typically low-end LG feature phone has a card slot. But whatever. That would totally ruin the iPad aesthetic, and make it too easy for users to get files on and off the device.

skipaq

When it comes to the content providers perhaps you are right in a way. But don’t kid yourself. These networks, studios and record labels have never sought to play nice with anyone. There is a reason things like Napster had their day. There is a reason people are tuning out the former major players and turning to Netflix and the like. These people and their corporations have been brought out of their caves kicking and screaming. If in part Jobs was one of the pitbulls to get them out then that is fine. Let them scream bully all they want. They needed someone bigger to get them moving.

Apple isn’t shut out from content. They sell more content today now than the old days. You don’t think they will have more in the future? Take a poll and see how many consumers think $.99 is to low a price for renting what these networks have to offer. These people are living in the past when they controlled it all. Hurray for Netflix, Boxee and Roku. And hurray for Apple for partnering with some of these as well.

I don’t trust the content providers. If they don’t trust Apple so what. Do you think that they will get $2.99 rental on GoogleTV? Will people actually pay for that? Let Eric Schmidt kiss up to these people and give them what they want and you will see the disaster that brings to the Android content revenue.

Even Google is dealing with growing pains. They have yet to shut the door on app pirating. That is something I would think would be more important to you than this price war. Apple has problems too. Hopefully, they both sort things out and we all get to enjoy the results.

jfbiii

And people are snapping up those 16GB streak with 5” screens straight from Dell at only $601.44, aren’t they?

You can’t buy a Galaxy Tab at the moment.

If there’s a real need for an SD slot, then the market will probably bear that out…when people get around to finally selling products that compete with the iPad instead of products that just gobble up the low-end low-profit portion of the market for which Apple isn’t interested in competing.

As for another explanation besides “the content providers do not trust Apple” I think that it would be: “content providers watched Apple shift music distribution in a way that disrupted labels’ chokehold on distribution and their ability to derive artificially high profits from that chokehold.”

Bosco (Brad Hutchings)

skipaq, piracy is a very nuanced issue. I have never thought that having centralized, walled distribution could do anything positive for the problem or do much that would benefit me. Like DRM on music, the net affect of standard DRM on software is to give inordinate control to the DRM supplier. The argument goes that developers would give up a lot of flexibility to stop piracy, but all they really end up doing is giving up flexibility, like basic customer data.

On video content, I think the networks and studios understand that, and are playing by a strategy of being very careful who they hand all the keys over to. I could see Jeff Bezos convincing the networks to let him sell unencumbered content in standard formats. With Kindle explicitly, he hasn’t used the device to tie content, instead trying to make a best-in-class reading device AND making Kindle software available for popular platforms. He has a track record of generally playing fair and taking his cut.

And back to the cable companies, who routinely make deals with the networks. They know how to fight fairly. The recent TWC/ABC spat was publicly aired in a formulaic fashion that we’ve seen over and over. ABC endorses DirectTV as a viewing option. TWC claims that increased license fees will jack up customer bills. It’s intense, but not nasty. Nobody called anyone lazy or claimed they were the source of all the decade’s problems.

Intruder

How to transfer files from SD card to iPad. No jailbreak required. Costs a little ($59.95 I think), but if you need the capability, it is there. Goes beyond the camera connector that Apple supplies, which can transfer photos and such from SD cards. You can also connect keyboards and headphones using the Apple camera connector.

So, there is a solution to one perceived problem.

DrShakagee

Would someone please offer a better explanation of this situation than ?the content providers do not trust Apple?.

Time Warner is the 4th largest video programming distributor in the US. iTunes rentals compete directly with Time Warner’s distribution modal. Simply allowing consumers to understand the concept of ‘pay for only what you want’, is detrimental to the entire cable TV industry.

I pay $78/month for cable TV (from Cox not T.W.), and don’t watch 78 shows a month. Having the option to rent or subscribe to only the shows I want would make me consider dropping cable all together. Having the option to buy show’s at double the price doesn’t (although I do own quite a few show’s from iTunes). Just the pay-per-view stuff from the cable company costs more then triple ($2.99) iTunes suggested 99? per episode, and I imagine is a decent revenue generator that would be threatened by iTunes providing the same content.

jfbiii

I could see Jeff Bezos convincing the networks to let him sell unencumbered content in standard formats.

Sure, but only if the iTunes Music Store already exists and you’re a record label exec desperate for leverage so that Apple couldn’t continue to hang on to 99?.

That isn’t going to happen with video.

As for trust, nobody forced the labels to agree to 99?. The stupid public went along with the “Apple is in favor of DRM and won’t ever drop it” meme that resulted from the Amazon deal because when enough people repeat a lie (“you can’t trust Steve Jobs” even when he says I don’t want to sell music with DRM but the record labels say the only way I’m allowed to sell music is to slap DRM on it) lots of people will believe it without question.

So when he gets to sell music without DRM, what does the untrustworthy and ever-shady Steve Jobs do? Exactly what he said he would: sell music DRM-free.

Bosco (Brad Hutchings)

Sure, but you totally ignore the outcome, which was that DRM’d music cemented iTunes Store and iPods as market dominators. The DRM doesn’t work in Apple’s favor without the exclusive on the hardware to play it. The content people understand that where the power lies in that dynamic, no doubt.

@DrShakagee… Most all the stuff under consideration is on On Demand for free on Cox. Even premium stuff is available on On Demand for premium channel subscribers. And you’re still going to need premium bandwidth to download these shows. I bet you’re on Cox’s or TWC’s $70/month Internet plan really quick if you watch a lot of rented TV.

mhikl

This clatter is better than anything Time Warner has to offer at any price. Feet up, beer at hand, Judge Judy kicking a** in the background. The world is unfolding as it should.

Intruder

On Demand is not part of basic cable in most locations. You pay for it one way or another.

DrShakagee

Most all the stuff under consideration is on On Demand for free on Cox

Oh so they’re considering renting 7 year old episodes of Hannah Montana and Bob the Builder? That’s about all I ever found free on Cox’s on demand channel, granted I don’t spend much time looking.

To be perfectly fair live sporting events prevent me from ditching cable, and still would no matter the iTunes rental options.

My point is just that the cable companies don’t want their customers to even know there is an alternative. Consumers spending extra money on a 14 channel package just to receive the one channel they actually want is the standard business model and that is what I think they fear is being threatened by iTunes rentals and to a much lesser extent iTunes sales.

skipaq

I look forward to the day when we look back on being tied to cable for broadband services like I once fiddled around with rabbit ears for tv reception. I look forward to the day when I can choose whatever program (including sports) I want like looking at a menu at a fine restaurant. I hope there are several providers of this service as there is now for eBooks. But I will not miss the way current providers force the whole menu into my living room and charge for stuff I don’t want. This one giant sized package fits all is going out the window of history.

I’d like to see Apple deliver on that; but if they don’t then we will be using some other provider. Those who have content to sell will see the light eventually.

Ted Parkman

LMAO!

Selling shows for $1.99 or $2.99? That?s a totally different animal.

In that case, we should charge $3.49, just to be on the safe side smile

b0wz3r

Why are you guys feeding the hate-troll?

Just put him on /ignore like I did; it makes reading these forum threads so much more enjoyable.

marcsten

Worth remembering where this thread started. I don’t think TW is passing (for now) based on Jobs. I also think its their loss. We’ll see. As an aside, Jobs has always been a mixed bag as both a boss and a human, if you believe what’s written about him. But so are the rest of us. WIth great genius often comes issues of getting along with others. On balance, as a stockholder, I am a big fan of what Steve has done. Not that I always agree with him, but right now, I have great products to use and am making lots of money at the same time. Hard to argue with that.

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