Advertisement
Canada markets open in 8 hours 10 minutes
  • S&P/TSX

    21,837.18
    -12.02 (-0.06%)
     
  • S&P 500

    5,149.42
    +32.33 (+0.63%)
     
  • DOW

    38,790.43
    +75.63 (+0.20%)
     
  • CAD/USD

    0.7379
    -0.0010 (-0.14%)
     
  • CRUDE OIL

    82.57
    -0.15 (-0.18%)
     
  • Bitcoin CAD

    88,328.84
    -4,230.54 (-4.57%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,162.20
    -2.10 (-0.10%)
     
  • RUSSELL 2000

    2,024.74
    -14.58 (-0.72%)
     
  • 10-Yr Bond

    4.3400
    0.0000 (0.00%)
     
  • NASDAQ futures

    18,178.00
    -53.50 (-0.29%)
     
  • VOLATILITY

    14.33
    -0.08 (-0.56%)
     
  • FTSE

    7,722.55
    -4.87 (-0.06%)
     
  • NIKKEI 225

    39,877.00
    +136.60 (+0.34%)
     
  • CAD/EUR

    0.6787
    -0.0005 (-0.07%)
     

Why Apple would want to bid for Time Warner

AT&T (T) is reportedly in the process of acquiring Time Warner (TWX), and it wants to get the deal done by Monday, Bloomberg reports.

That would mark a swift completion time from Thursday, when the news first broke. And according to Bloomberg, part of the reason AT&T is in such a hurry is that it is concerned “other potential bidders, such as Alphabet Inc.’s Google or Apple Inc., could jump in since AT&T’s interest became public.”

It’s understandable why AT&T wants Time Warner—the deal would instantly help AT&T leapfrog Verizon (VZ) at Verizon’s recent efforts (buying AOL and Yahoo) to become more of a content company. Alphabet (GOOGL) buying Time Warner arguably makes less sense. But for Apple (AAPL), buying Time Warner would make a lot of sense.

Apple and HBO (owned by Time Warner) partnered last year to put HBO’s long-anticipated over-the-top service, HBO Now, on Apple devices. At a panel just this week as part of the Vanity Fair summit in San Francisco, Apple senior VP of Internet software Eddy Cue, who oversees TV and digital deals, and HBO CEO Richard Plepler, spoke in detail about just how significant and successful the union between Apple and HBO has been.

ADVERTISEMENT

“Our natural DNA is obviously not technology, it’s content, and we have a long learning curve,” said Plepler. “They gave us great counsel and input.” Some of that counsel was Apple recommending HBO turn to MLB Advanced Media (MLBAM) to build its standalone HBO Now app, after the HBO Go app, its first digital product, had problems with its streaming technology.

Plepler continually made clear how key Apple has been to growing HBO’s audience. “When we went to them, HBO Go usage, before we built HBO Now, was disproportionately high on Apple devices, so we knew that when we started this new venture, they were going to be the perfect partner.”

Cue was pressed during the panel on the fact that even though Apple and HBO are partners, they will also soon be competitors, now that Apple has announced its own plans to create original digital programming. Cue said, “Look, we’re doing certain shows today that we’ve announced, so we’re certainly doing some things, but I don’t think you’re going to see us do a huge number of them, I think you’ll continue to see us do more partnerships.”

If Apple simply buys Time Warner outright, such competitive tensions would not be an issue; Apple and HBO could create content together, with creator and distributor in one family.

To be sure, HBO is just one small part of what Apple would be getting if it bought Time Warner. But the success Apple has seen with putting HBO on its devices is a key sign of why a deal might appeal here.

Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology. Follow him on Twitter at @readDanwrite.

Read more:

Apple’s Eddy Cue on HBO: ‘Television needs to be reinvented’

How much longer can Netflix remain the streaming content king?

Disney is so much more than Mickey Mouse now

ESPN must evolve beyond TV, and has time to do it