Apple Charging Lower Fees For Streaming On Apple TV

Apple giving services like Netflix and Hulu a better deal on its subscription ‘tax’

By Kris Wouk April 14, 2015

While most of the recent talk involving Apple has been centered around its recent releases of the Apple Watch and MacBook, there have been signs lately that the company is beginning to bring its attention back to the oft-neglected Apple TV.

In the past few months, Apple TV nabbed a timed exclusive on HBO Now and announced an upcoming rival to Sling TV. Now rumors are building that a new generation of the hardware will be unveiled at this year’s WWDC, but that’s not all that Apple has up its sleeve for the tiny streaming box.

When Apple users sign up for a new subscription for Netflix, Hulu, or any number of other streaming audio or video services through an app, 30 percent of the fee usually goes straight to Apple. This has been the case since 2011 for apps on the iPhone and iPad, but it seems that there is a way for streaming services to get around this: the Apple TV.

Streaming services, including the aforementioned Netflix and Hulu, as well as others like MLB.TV, only pay 15 percent to Apple, so long as users sign up for the subscription on the Apple TV, according to Recode. To the end user, this doesn’t matter– they’re paying the same amount no matter where they sign up or on what device– but it does give those streaming services incentive to promote their Apple TV presence.

Even at the higher 30 percent fee, this is a better deal than the 50 percent cut that cable companies often charge networks. With more networks looking at expanding their offers to either à la carte providers like HBO or packages like Sling TV, those changes in percentages add up.

The question is: At what point does it become worth it for these networks to simply leave cable companies behind?

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