A new report published in The Wall Street Journal Sunday claimed that Apple and Comcast are collaborating, hinting at the next level of television and leaving advocates for net neutrality hanging their heads in disappointment.
“Apple Inc. is in talks with Comcast Corp. about teaming up for a streaming-television service that would use an Apple set-top box and get special treatment on Comcast"s cables to ensure it bypasses congestion on the Web, people familiar with the matter say,” begins the report.
The teaming would end in a service that could replace live and streaming television as we know it—using the cloud to stream recorded, on-demand, live and purchased entertainment in a way that could dismantle similar services from Hulu or Netflix.
The talks are merely talks at this point, though.
“Apple and Comcast aren"t close to an agreement, said one person familiar with the talks,” the report continues. “Delivering the service quality Apple envisions would require Comcast to make significant investments in network equipment and other back-office technology, according to people familiar with Comcast"s thinking.”
Wall Street responded positively to the news this morning, though. They jumped about 0.7 percent by midday Monday.
"A deal like this is what Apple has needed from the beginning," Peter Csathy, CEO of Manatt Digital Media Ventures, told USA Today. "It only makes sense if they get all the live-TV channels, especially ESPN. They"ve not been able to effectively negotiate on its own."
Csathy believes Comcast has the most to gain from a partnership.
"Apple will be in the TV game. Comcast can either take the lead or follow," he continued. "Apple"s iTV could be (a system of) programming by Comcast through the cable Internet offered by another ISP in that market. That"s a beautiful thing for Comcast."
The report has many worried about net neutrality. Last month, Netflix agreed to pay Comcast more money for faster speeds. After recent court rulings that struck down net neutrality, we may be looking at an age where companies have to pay extra cash to service providers for decent service. The fear is that Comcast will become a tollbooth for all services seeking to reach consumers online, including smaller operations like Hulu.
Neither Apple nor Comcast commented on the report.
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