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How Apple Inc. Can Beat Netflix, Inc. In Internet Streaming

Stocks in this article: AAPL CMCSA NFLX

Apple should pursue exclusive digital rights for the Star Wars films, which are yet to be released in a digital platform

Apple Inc. (AAPL) is in talks with Comcast Corporation (CMCSA) (CMCSK) to partner for a streaming TV service using Apple’s set-top box, reports The Wall Street Journal. The iPhone maker has, for years, been trying to reinvent the television industry. The company has been exploring several avenues in TV industry. But so far Apple has been unable to find a business model that cable providers and media companies find appealing.

Apple Netflix

Apple Inc. (AAPL) wants to allow users to stream live and on-demand programming, as well as digital video recordings in the cloud. The talks with Comcast Corporation (CMCSA) (CMCSK) are still in early stages, but it’s a strong indication that Apple will offer consumers the best incentive to cancel the cable, says Jason Lynch of Quartz. Many consumers havesaid that they will ditch cable service, but very few of them do so. That’s why Tim Cook needs to go beyond the crowd of everyday offerings to make a splash. Here are a fewways Apple can make its service better than Netflix, Inc. (NFLX).

Apple needs to strike a deal for HBO Go

HBO’s streaming site HBO Go is available only to users who subscribe to HBO through their cable companies. Earlier this month, HBO CEO Richard Plepler said that he is willing to offer HBO Go as a standalone service as soon as numbers begin to make sense. Apple Inc. (AAPL) needs to reach a deal with Plepler for HBO Go. That will be an ideal way to allow consumers to subscribe to HBO Go without having to spend a dime on the basic cable package.

Apple will have to revive the concept of TV rentals

Apple Inc. (AAPL) can use its leverage amid the battle between studios and networks over the “in-season stacking rights,” which is the ability to access all episodes of a show’s current season. The iTunes already offers access to all the episodes of a current season for many series. The networks can stream only five episodes of a show based on their agreements with the studios. Lynch says Apple can woo a large number of customers by reviving the concept of TV rentals, where users can pay a reduced fee to watch an episode in the next 24-hours.

Apple should pursue exclusive rights for Star Wars films

Apple Inc. (AAPL) reached an exclusive deal for the Beatles catalog in 2010, and the company needs to do something like that again. Lynch says Apple should pursue the exclusive digital rights for the Star Wars films, which are yet to be released in a digital platform. And that’s possible for the iPhone maker. Lucasfilm is currently owned by The Walt Disney Company (DIS), whose CEO Robert Iger sits on Apple board. The next Star Wars film is expected to be launched in December 2015. Using the appeal of this iconic movie series to launch its streaming service would give viewers a good reason to move to Apple.

Apple Inc. (AAPL) is currently building the infrastructure to launch an original series. But the company should move with caution. All content platforms today, including Xbox, are in a hurry to add original content. If Apple wants to stand out from the crowd, it needs to offer innovative programming that doesn’t exist elsewhere.

Apple Inc. (AAPL) shares ticked up 0.88% to $537.88 in pre-market trading Monday.

The post How Apple Inc. Can Beat Netflix, Inc. In Internet Streaming appeared first on ValueWalk.

-By Vikas Shukla

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