Time Warner hasn’t committed to stepping up onto the auction block, but pressure is mounting for the company to do something because its value for shareholders is declining.
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According to a New York Post report (via MacRumors): “Eddy Cue, one of Apple Chief Executive Tim Cook’s top lieutenants, in charge of content deals, has been keeping tabs on proceedings at Time Warner, a source close to Apple said”. These include the crown-jewel premium network HBO, the CNN news network, TBS and TNT, which have some sports contracts, and the Warner Bros. studio.
Time Warner shares closed at $71.06 yesterday, which is far below the $85 per share offer 21st Century Fox made and had rejected 18 months ago. Apple doesn’t do deals this large-its biggest previous was Beats Electronics in 2014, for $3 billion-but there’s a first time for everything.
The Post report said Apple would be interested in Time Warner’s assets to support the launch of a stand-alone streaming TV service. He noted that HBO content is already available on Apple TV, but, if Apple itself owned and controlled the content, it “could throw everything from Veep to Game of Thrones into its bundle for free”. There is too much included in the package that is Time Warner that Apple doesn’t need. “HBO looks set to thrive in a cord-cutting world; Time Warner’s cable networks are more likely to struggle”, the article said.
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That would be less expensive than today’s cable offerings, which offer hundreds of channels that many subscribers don’t watch. Even HBO alone would be a huge feather in Apple’s cap. Apple likes to make small tuck-in acquisitions of companies with interesting technologies or talented engineers.
