(Reuters) - Netflix shares slumped more than 7 percent on Monday after a report about a new television streaming product that Comcast and Apple were working on together.
Netflix shares fell $31.49 or 7.78 percent to $374.67. The drop came a day after a story that first appeared in the online edition of The Wall Street Journal said Comcast and Apple were in talks about teaming up for a new TV product that stores programming in the cloud and would replace clunky cable boxes in people's homes .
Apple and Comcast have declined to comment on the report but a source familiar with the matter told Reuters the discussions were at an early stage and there are a lot of hurdles to be crossed before any agreement is reached.
Apple also wants the TV service's Internet traffic to be separate from public Internet traffic and would be looking for special treatment from Comcast's cable pipe to give customers a better experience, the newspaper said.
Arris Group Inc , a company that makes set-top boxes for the cable industry and paid Google $2.35 billion for Motorola's cable box unit last April, also saw its shares fall 6 percent on fears that an Apple-Comcast partnership could hurt sales of traditional set-top boxes.
(Reporting by Liana B. Baker; Editing by Tom Brown)