LOS ANGELES — The first thing that usually comes to mind when one thinks of Apple Chief Executive Steve Jobs is the iPod, which revolutionized how people listen to music.
But Jobs, who announced on Wednesday afternoon that he is stepping down as CEO of Apple, should also get a lot of credit for changing the way we watch TV.
Back in 2005, it was Jobs who cut a deal with Walt Disney Co.'s ABC to sell ABC shows on iTunes just one day after the episodes had aired on the network. The deal was considered groundbreaking at the time and caused a lot of concern in the television industry, particularly among ABC affiliates, who sent a letter to the network expressing anger at the agreement and at the fact that ABC had not consulted them on it.
The fear was that if viewers opted to watch shows via iTunes, ratings for the network and its stations would fall and the backbone of the television industry would collapse.
Apple's new offering "is really bad" for affiliates, Forrester Research analyst Josh Bernoff told the Wall Street Journal at the time. "You don't get anything. You just get a smaller audience," he said. (Full disclosure, this reporter co-wrote the Wall Street Journal story on Apple's deal with ABC.)
What Jobs and Disney knew was that new platforms were emerging that would become just as important as the television in the living room and the networks would only be hurting themselves if they ignored them.
But Jobs' and Disney's deal also was the beginning of the end of appointment television. While the VCR and later the DVR already started to free viewers from being held hostage to network schedules, iTunes and the platforms that followed took it to the next level.
While it is true that the rise of Apple's various devices and the decline of network television ratings is not a coincidence, those devices also have helped create new revenue streams for Hollywood as well. All the evidence you need is a visit to the gym, where many watch old shows on their iPads while working out on the stairmaster. Studios and networks now have new ways to sell reruns of their shows, especially the cult programs that never developed a big enough audience to make a killing in the traditional rerun market.
Hollywood still hasn't figured out how to offer its content on all these outlets without cannibilizing its own business. Eventually it will, but not without a few other forward thinkers like Jobs.