Apple Should Offer iTunes Subscriptions – For Video Only
9:40 pm, November 16th, 2008, Pete Mortensen
I took quite ill on Thursday, and literally didn’t leave the house at any point between Friday and Sunday mornings. And, like a lot of bed-ridden people, I was in far too much pain to actually think about reading, writing, or, well, thinking. Instead, I got caught up on all of the junky entertainment I never find time for otherwise. Comic I hadn’t yet read. DVR’d episodes of Top Design. And virtually all of the content on Netflix Watch Instantly.
Now, for those of you who still haven’t had the chance to try out streaming Netflix, I will say that it works incredibly well. Movies start quickly, the new interface allows you to scrub through looking for your exact place, it resumes play if you accidentally quit. (I had a few films with skewed soundtracks, but it was a rare occurrence). What’s astounding, however, is just how tiny the Netflix streaming library is compared to Hulu, iTunes, or, you know, Netflix DVD service. After a few days in bed, I’d watched literally everything that I had any interest in seeing that the streaming service had. I mean, there are only two seasons of 30 Rock.
And that’s when it hit me: everyone who’s called for Apple to start a monthly subscription model for iTunes has been almost right. There’s tons of money to be made there. But the opportunity isn’t from making its full music library available for $15 a month. It’s in charging $20-30 a month for unlimited TV show access.
Think about it: Apple has the largest library of digital downloadable video on the planet right now. Sales haven’t been as good as hoped. Apple has begun to rent movies, which means it has the DRM to prevent people from keeping a permanent copy of a rented clip on their hard drive. And yet TV shows are still available only for $1.99 each. While that’s a pretty good price, it’s not one that I’ve paid since Apple first made TV available through iTunes (I briefly had 10-pack passes for The Daily Show and Colbert way back). But I would gladly ditch my Netflix subscription and pony up the same $20 a month for unlimited rentals of the TV shows on iTunes, even without movies. That’s $240 gross from me that Apple and the TV studios wouldn’t see otherwise.
Now, if it were anyone but Apple, I would say that kind of price is too high to pay. But this wouldn’t be a streaming competitor to Hulu — it would be for files that could work on any iPod or iPhone. That’s a compelling proposition right there. It would further cement Apple’s vertical integration as the premiere agent for digital entertainment on earth. It would make an AppleTV as essential as a TiVo. It could even begin to make the cable companies nervous if Apple’s selection continues to improve (live sports being an obvious exception).
I think it’s a slam dunk. Does it make sense to you?
Posted by Pete Mortensen in Apple, AppleTV, iTunes | Comment on this article
I’ve been saying this to everybody who will listen.. (but hardly anybody listens to me).
I never buy TV shows… I don’t see the value in buying something that I will likely delete just after viewing…. but a subscription on TV would be awesome… (make $10 more for movies.. and bingo… cable TV is all but dead).
Kuma, on November 16th, 2008 at 11:11 pm
No
Subscriptions are dumb.
I stop paying money, I lose my content.
Pmoes, on November 17th, 2008 at 2:58 am
a thousand time yes. i’ve been dreaming up this little idea myself. throw in tv content, and i’ll get rid of cable just to buy an Apple TV.
Rey, on November 17th, 2008 at 5:20 am
Absolutely! If Apple offered unlimited video rentals for a flat fee, I would buy an Apple TV in a heartbeat. I’m very excited about the new TiVo-Netflix partnership, but Apple’s selection blows it out of the water. I’d include movies, as well.
eric, on November 17th, 2008 at 6:17 am
Hi Pete,
I like the Netflix subscription/streaming model much better than the Apple buy/rent/download model, which is why my Roku Netflix player get used almost every day while my AppleTV gathers dust.
The bottom line is that the Netflix/Roku experience just fits better with the way I want to watch TV. I hardly ever watch the same movie or TV episode more than once, so I don’t want to pay a premium to purchase content. My daughter watches certain kids’ shows over and over again, but tends to outgrow them in a few months. In both cases, the Netflix subscription model is ideal for our family. In theory, the Apple TV rental model would also be OK, but the restrictions are too onerous; I’ve missed movies because my wife watched a rental one night and I couldn’t get back to watch it within 24 hours.
The flip side of this is that streaming to the Roku player or my computer whenever I wanted to watch is effortless. For Apple TV/iTunes I have to download the content to my computer or Apple TV, make sure there is enough room on the target hard drive, sync and move the files between devices if I change my mind about where to watch it, back it up if I want to keep it long term, delete it when I no longer want it or need to free some room, etc. Who wants to deal? I just want to watch TV!
If Netflix can keep improving their premium content like first-run movies and strike a deal with the networks to get current TV shows, I can envision canceling my Comcast cable TV subscription one of these days and just going with Netflix. On the other hand, you’re right that Apple already has all the content and may just need a subscription option to be much more successful.
Regards,
Tim
Tim Lynch, on November 17th, 2008 at 6:37 am
Makes sense to me and I would probably pay $30/month for it since it would allow me to cancel my Comcast cable tv altogether. All I want out of tv is the ability to watch the shows I want to watch when I want to watch them. Similar to you, I am not renting tv shows for $1.99 (or more for HD). Something about this price rubs me the wrong way and I almost never do it. Apple (and content owners), if you are listening, how about $20/month for unlimited SD tv shows and $30/month for unlimited HD tv shows.
Jason, on November 17th, 2008 at 7:42 am
this would be a very smart move and I have hoped for it since the first day of renting a movie on my Apple TV…something I do very rarely since I have a Netflix membership and download movies from other sources.
Apple would kill a good chunk of the Bittorrent downloads for movies and TV shows if they did this. and that would make the studios *very* happy. and make me get rid of Netflix…and stop “time shifting” titles.
Spidey, on November 17th, 2008 at 7:39 pm