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Apple Won't 'Be The First' A La Carte Cable Service, But 'We Are Almost There'

Apple Won't 'Be The First' A La Carte Cable Service, But 'We Are Almost There'

Apple Inc. (NASDAQ: AAPL) is in the news again after Variety reported that Apple is looking to get into original programming. The report did not surprise analysts, who have been expecting Apple to enter the space for some time.

"I do think a la carte is awesome and we are almost there," Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, told Benzinga. "Intel was close to getting it on their set-top box. They had a couple big holdouts, but they had the majority of the portfolio filled in. I do actually think that is a huge opportunity for Apple."

That said, Moorhead does not believe Apple can launch a pay-TV service until the company can amass a "full portfolio of content that, in aggregate, is not an obscene price."

"The hardest is live sports," he said. "That's where the rub is. Apple (and for that matter Intel) had locked in everybody but the sports guys and actually there was a holdout at Disney. But that was almost two years ago and I think Apple was still waiting until it had that full portfolio (for not just the States but at least one other country) to pull that trigger."

Apple's own success could prove to be a challenge in persuading content makers and distributors to bring their networks to iOS.

"The reason it's the hardest is because Apple is the biggest [tech company]," said Moorhead. "You could affect entire profits of entire companies based on that one deal."

That is one of the reasons why Moorhead said he "wouldn't expect Apple to be the first" to develop a true a la carte service.

Related Link: DISH Network Exec: Here's Why A La Carte TV May Be An Apple Fanboy's Dream

Original Content Reigns Supreme

Tech expert Sean Udall doesn't think the iPhone maker will produce the ultimate choose-what-you-want pay-TV service. He said that would actually lead to higher costs for consumers because the fees are higher for services that are sold individually. Instead, he expects Apple to focus on original content.

"In fact, over time, the original content may be more sticky," Udall told Benzinga. "I really don't like Netflix. The amount of time it takes me to find a decent movie to watch is literally not worth it. What keeps me on Netflix -- I was so close to cancelling -- and what did they come out with? 'Daredevil.'"

Udall said he has watched the "Daredevil" series twice since it debuted.

"They keep my $8.99 a month coming because now there's no way I'm cancelling," he added. "I gotta have it when the next Daredevil shows up. So the original content is pretty darn sticky."

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

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