The New York Post reports that Apple is closely following the situation with Time Warner; the company is facing pressure from investors to put itself up for sale and Apple is interested in acquiring it. Many investors believe Time Warner stock is trading far below its asset value and many investors believe that a buyout or spinoff of some kind is the best option.
Apple could use the company to accelerate its efforts to launch a digital streaming cable service for Apple TV. Time Warner controls a vast content library, including popular shows like Game of Thrones as well as entities like CNN News. More importantly perhaps, it has deals in place with every channel that Apple would need to become a full TV platform.
Cupertino, Calif.-based Apple has struggled to create a skinny bundle of programming from existing content partners. A deal with Time Warner would give Apple most of what it needs: CNN news, Turner Sports and such hugely popular shows as “Game of Thrones” and “Sesame Street” from HBO — not to mention Warner Bros. movies and TV shows.
Although there is a chance Apple could buyout the whole company, Time Warner may end up spinning off parts of the business, although the CEO is resistant.
The New York Post says Eddy Cue is watching the events unfold, with Apple potentially interested in jumping at the opportunity if it arises. Apple partnered with HBO (a Time Warner subsidiary) earlier in the year, so a business relationship already exists for the two companies.
Eddy Cue, one of Apple Chief Executive Tim Cook’s top lieutenants, in charge of content deals, has been keeping tabs on proceedings at Time Warner, a source close to Apple said.
The Posts also says that unlike other media companies, Time Warner does not have a tiered share structure, making a potential buyout easier to execute without managerial consultation. Other potential suitors for the deal include AT&T, owner of DirecTV.
Apple has been long-rumored to be working on a digital streaming TV cable service, featuring a ‘skinny bundle’ of about 30-40 channels for a monthly subscription as low as $40. Reportedly, the original plan was for the Apple TV 4 to launch alongside the ‘Apple Video’ service. However, due to delays, Apple decided to launch the new hardware last October standalone.
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What happens to AOL if Apple buys Time Warner?
“Welcome! You’ve got iCloud.”
AOL hasn’t been part of Time Warner since… 2010, I think it was? It’s part of Verizon now.
I think even earlier than that. And this story is about Time Warner the cable company which was spun off from Time Warner the media company (the one that owns HBO).
AO…… WHAT??!!
Write the check, Tim!
Please oh please oh please oh please!
While you’re at it, buy a couple smaller record labels and accelerate the democratization of music as well.
AT&T would be nowhere near suitable when it comes to usability by the international market – all acquired content would no doubt be locked digitally to AT&T subscribers which would also be a huge disadvantage to other cable providers even in the states
Hmm…as a shareholder not sure I’m comfortable with Eddy Cue being Apple’s M&A guy, Whag has Beats done for Apple? Nothing. You can’t tell me the Apple Music app wouldn’t have happened without Beats. And the increase in the “other” on Apple’s financials is over 100% driven by Apple Watch which means revenue from accessories like Beats headphones is actually declining. I hope Cook isn’t feeling pressured into making some big acquisition just to appease Wall Street.
I agree that all of Apple Music could’ve been done without Beats. This buyout on the other hand has a pretty big differentiating factor; infrastructure. Google Fibre is a good example of having the money to go into a market and building an infrastructure not always being the best way to build a new service. It is still a very very slow process.
Also, it allows the Apple TV to not just show the possibility of working as a digital cable box or DVR but will be in every TWC subscribers house. Could be a big deal.
Wait until they drop the 3.5mm jack on the iPhone 7, then you’ll see Beats headphones fly off the shelves more than they do now. They’ll make sure they are all lightning, bluetooth, or both.
Even that could’ve been done by Apple without Beats if they wanted to. They just need to actually show some more love to their own EarBuds.
FYI Time Warner and Time Warner Cable are two separate companies guys. You should remove the final paragraph since it’s completely unrelated to the current Post story and the companies involved.
That’s a shame TWC would be a much better buy.
I had no idea that they were different companies, thanks!
Wait a minute this article is confusing. I just read the New York Post article and they’re talking about Time Warner the media company, not Time Warner Cable. Time warner Cable was split off from Time Warner years ago. Comcast attempted to acquire Time Warner Cable, not Time Warner. Time Warner owns cable properties like CNN and TNT as well as HBO.
Yes, but they would use the content owned by Time Warner Inc. to compete with TW cable TV services who, arguably, would be selling the same content at a lower value proposition.
Hmm…I’m skeptical that Apple needs to be in the business of owning content. They just need to provide the platform for others to put their content on.
@rogifan Yeah that’s working out so well for them. Oh wait, they can’t get any streaming deals because they don’t own any of the content..that’s right.
@rogifan Netflix is starting to prove it might be better to own your own content than pay up for others. Amazon too. Look at Amazon picking up two golden globes for their shows. Making a Murderer from Netflix is getting publicity you could only pray for. Their Marvel series are excellent. I don’t think there has been a Netflix original series yet that hasn’t provided a decent return on investment.
I’d love the opportunity to pay ONLY for the channels I watch. Let me pay $40/month and pick the 20 channels I absolutely need to have. Not to mention that all the On-Demand content would basically eliminate the need for a DVR. Also, it could wind up giving Hulu a run for their money since you’d probably end up canceling your subscription to Hulu if you can get all the stuff you watch on demand from Apple, anyway at no additional cost.
That has nothing to do with acquiring Time Warner unless you’re only interested in their cable properties. I don’t watch CNN, TNT or the Cartoon Network.
Channels is boring. Pick individual shows. Downloadable ~4 hours before they air so there is no streaming quality loss, no server issues, and a selective quality is available to use less data if desired. If desired, 1080p download will absolutely decimate any cable picture quality of that show, and thus, the best experience by far would be on the Apple TV in true 1080p, with only Apple’s compression which is far superior to cable compression which isn’t close to even 1080p.
Even if channels are the way it goes, you’ll select individual shows from those channels to care about. And I think as an example I’ve used previously, if you chose The Walking Dead, you’d be given information about it, a time to download, automatic download ~4 hours before it airs, choice of download quality, and notification for 5min before the show’s air time so you can watch it immediately when it airs, and be taken right to it. The download is unavailable until the air time, so it is simply a locked down DRM file, which is inaccessible until the air time and an Internet connection is required at air time to authenticate the content and play it.
Getting HBO would be huge. Huge library and create some of the best original content.
40$ for 40 channels is low? In the meantime in Europe people get 40 channels for free.
Free? Really? And how much are your taxes?
I don’t know too much about Time Warner Cable, because I have Charter, but this is really exciting!! I really hope that Apple goes through it. I will most likely get this, even though $40/mo, is a lot for a college student, but i’m sure it will be worth it.
I suppose it also depends on the variety of channels etc for the price too.
I hope not: I don’t want to hate Apple as much as I hate Time Warner
Both Time Warner and HBO are partners of Ultraciolet which would be great to finally be integrated into iTunes. Flixteris also owned by Time Warner, it is a great app with being able to buy tickets and stream Ultraviolet movies.
Cartoon Network would be good for children programming
Cord-Cutter here. I am SO tired of having to sometimes illegally download content, even stuff that I AM legally entitled to and can easily access OTA (antenna access, networks–all of them). I have NO PROBLEM paying for services I use and do subscribe to some. I am certain that there are hundreds of thousands of you out there in the same predicament. Apple TV is a joke in that regard. The “channels” are there—if you have access rights through a cable provider. BS. Cable providers have a stranglehold on American TV content and internet access. And Apple, with it’s $200 billion in “excess” cash is the one company that can squash that parasite. It is time for cable to go away and Americans to have access to media content on demand at a fair and sustainable price. It absolutely crazy that people have to pay literally hundreds of dollars a month to watch sports, a few TV shows and get internet access because all that is controlled and manipulated by three huge providers across the continent. Let us “buy” the content we desire for a fair price to us and the actual content providers (not the re-sellers!) and save $50-100 a month to be spent on, for example, food, shelter and health.
Aren’t there some HUGE anti-trust issues involved with Apple owning Time Warner–particularly with Apple’s ties to Disney?
50 billion cap… PE of 16…. Eps of 4.6…
Im a littke confused.. Why is there pressure to sell ?
I woukd like to see apple taje control… But is it wise to spend 50 billion is beyond me…