Apple TV: The Stuff Dreams Are Made Of. I addressed C's take in Is 2013 the end of Apple? And Dana Blankenhorn kept the hits coming with Monday's Sports Opens Door For Apple TV. If I read Dana right, he thinks Apple has the physical incarnation of Apple TV in the bag. I don't agree. He believes the real focus as Tim Cook prepares to roll this thing out is on negotiations with content owners for the right to offer unbundled programming. Dana reckons Apple can convince cable companies and content owners to do what so many consumers dream of -- unbundle their programming and offer it a la carte via Apple TV. Apple already does that via iTunes. However, it's not all that different from Netflix ( NFLX) in this regard. The major similarity: Apple remains at the mercy of the major programmers; Hollywood only gives Cupertino access to a limited lineup. The most sought-after programming doesn't see the light of day on iTunes or Netflix; it only makes it to Hulu Plus and the programmers own disparate TV Everywhere ventures. The big difference: Programmers like Apple more because it charges a premium for the content it gets. That's why it receives so many new releases. For example, you can already watch the final episode of the Nickelodeon hit iCarly on iTunes, but it will cost you:
Do the math. Even if you only watch moderate amounts of television, cable looks like a bargain compared to paying $4 for one episode of iCarly ($5 in HD) or $20 for standard definition, $30 for high def for the entire sixth season.
One $4 episode per night (delayed by several days) turns into $28 a week, which turns into $112 a month. In this situation, cable becomes a sweet deal. There's absolutely no incentive for programmers to give Apple much more. Again, it's very similar to the Netflix relationship in theory. And there's even less incentive for consumers to use iTunes/Apple TV to cobble together a viewing schedule that would end up being more expensive than the sum of its parts as traditionally conceived. Although Blankenhorn doesn't explicitly say Apple could or should do this with sports, plenty of others have. A day doesn't pass without a rumor of Apple trying to weasel access to major sports programming directly (e.g. EPL Soccer rights) or indirectly (you name it). Here again, what's the incentive for a massive old guard media company to pay billions for the rights to sports and then license those rights to Apple? We will not live in a world where you fire up iTunes on your Apple TV and order Knicks-Nets on MSG without having to purchase the entire NBA League Pass. Ultimately, the particulars do not matter because names such as NBCUniversal, majority-owned by Comcast ( CMCSA) and News Corp's ( NWSA) latest acquisition, YES, have no reason to bust the model, even if it means hurting Disney's ( DIS) ESPN franchise. Think about it. You're Time Warner's ( TWX) Turner division or News Corp's Fox. You just paid billions of dollars for the rights to Major League Baseball games over the next decade or so. These highly coveted sports telecasts give you the leverage you need to charge cable companies and, in turn, consumers hefty amounts for packages that include channels nobody watches or would pay for if they didn't "have" to. You have a sweet deal. You own the content. You control the content. You sell advertising on it. And you effectively own the means of distribution because, at the end of the day, you have the cable and satellite companies by the private parts. For example, a regional network such as Madison Square Garden ( MSG) can hold Time Warner Cable ( TWC) hostage, effectively saying if you want people in New York to ever see the Yankees, Rangers, Devils and Buffalo Sabres again you will take the Fuse network and like it.
Apple comes along and says, Listen, kill that party so we can have access to the most desirable programming that remains in this increasingly mobile and on-demand world. We'll screw you guys just like we did the music labels when we blew up the idea of buying a CD for fifteen bucks. We'll take sports and offer it unbundled through a device we want you to subsidize, unlocking value for a company with $6 trillion in cash offshore and customers who have hated cable for the last 10 years. Rupert Murdoch. Jeff Bewkes. These guys are not that dumb. They're certainly not going to fall hook, line and sinker for the ill of history repeating itself. And definitely not with Steve Jobs out of the picture. Follow @rocco_thestreet This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.