Apple iTV a Set-Top With Live, On-Demand Content?

The Wall Street Journal is the latest to add to the iTV rumor, with inside sources telling the paper that the device will erase the distinction between live and on-demand content. They claim it will feature a DVR service that stores TV shows in the cloud so that users can start any show at any time, or restart a show minutes after it has begun, similar to Time Warner's Start Over feature.

The paper also reports that Apple has been talking with cable operators, including Time Warner Cable, to let subscribers replace their current set-top boxes with Apple's own solution for live television and other content. The fruity company has also reportedly approached content owners with an outline of what Apples wants the device to do in regards to their media.

Insiders report that some of the proposed new services -- including the web-based DVR -- reside outside the existing rights over TV content cable operators currently have. To make everyone happy, content owners will need to expand the rights of cable operators so that the Apple box can be deployed. Apple may also need to negotiate with content owners to bring past seasons of shows it already offers through iTunes to the set-top box.

Sources report that the relationship between Apple, cable operators and content owners still remain tense, and the company still hasn't sold the idea to operators. It's quest to transform the TV industry thus remains stagnant, as operators and content owners are worried that Apple will dominate this sector just as it has with smartphones and tablets.

Most of what the Wall Street Journal described on Friday is nothing new: a user interface similar to what's offered on the iPhone and iPad, social features embedded on the screen such as sharing shows via Twitter and Facebook, and accessing media through a host of other Apple products. Previous reports have even indicated that Apple wants users to start a show on one device, and pick up on another.

At one time, talk about Apple's rumored iTV stemmed around an actual HDTV with a built-in iOS operating system, Siri and motion sensing technology. That may still indeed be the case given that several people have actually seen this device. But Apple may also be looking to offer a cheaper set-top box, following Google's Google TV efforts of offering both form factors. The set-top box could still contain all the features found in the pricier HDTV model, just without the screen.

The paper reports that talk about the iTV gadget arrives as sales of Apple's current set-top product, the $99 Apple TV, are "picking up but are still small." In the last quarter that ended in June, Apple reportedly sold only 1.3 million units. The device is more like a web streamer than a multimedia cable box, offering some internet video and services like Hulu Plus and Netflix.

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