Apple courts EPIX for upcoming TV: sources

Fri Apr 27, 2012 4:52pm EDT
 
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By Ronald Grover and Lisa Richwine

LOS ANGELES (Reuters) - Apple Inc began talks earlier this year to stream films owned by EPIX, which is backed by three major movie studios, on devices including a long-anticipated TV, according to two people with knowledge of the negotiations.

Apple, which now sells a $99 set-top box that hooks up to a television set and lets users stream online content from Netflix and the MLB channel, opened discussions with three-year-old EPIX, created by Lions Gate Entertainment Corp, MGM and Viacom's Paramount Pictures.

One of the sources told Reuters that any discussions would apply to its set-top box and also to upcoming devices that stream content. Apple is widely expected to unveil a full-fledged TV product later this year or in early 2013 to drive its next phase of growth and potentially revolutionize the industry.

Apple has been stymied for much of the past year in securing marquee Hollywood content. Talks with EPIX are in the preliminary stages and no agreement is considered near, the source said.

The talks could be complicated by EPIX's 2010 agreement with Netflix, which pays $200 million a year for the rights to stream movies to its 23.4 million U.S. clients. That deal gives Netflix exclusive streaming rights to EPIX movies through September - before Apple is expected to trot out its planned TV set.

Apple declined to comment on what it called "speculation." A Netflix spokesman had no immediate comment. An EPIX spokesman had no comment.

Netflix CEO Reed Hastings said in an April 23 conference call with analysts that the DVD and streaming service was in a "broad range of discussions" with EPIX about "how to operate most effectively for both of us."

EPIX currently offers movies such as "Rango" and "The Lincoln Lawyer." It will soon add "Thor" and "Transformers: Dark of the Moon," Netflix said in a letter to investors.   Continued...

 
An Apple retail store is seen in Carlsbad, California April 6, 2012. REUTERS/Mike Blake