Would You Pay $1 For a TV Show?
Bolstering persistent indications that Apple will be using the iPad to propel its TV distribution system
through iTunes, the Financial Times reported on Wednesda
y that Apple would begin offering some TV shows at the cut rate of $0.99 US per episode, down from the $1.99 the company currently charges for TV programs in standard definition video.
The Wall Street Journal said that talks between Apple and TV networks were still ongoing and had not been concluded yet. Many observers were surprised when a rumored $30 subscription service
was not announced at the iPad unveiling last month. The service would have offered a "best-of-TV" package to customers for a single flat rate. TV networks, however, were worried that existing relationships and subscription fees from cable companies would be threatened by the arrangement. According to the Financial Times, however, the $1 TV program deal is seen by Apple as a way to make networks comfortable with the idea.
This new price is said to come into effect around the same time as the iPad's launch, probably in late March, as a way of boosting interest in both the new device and drawing attention to Apple's new service. The Financial Times
quoted a "person familiar with the talks" as saying the lower prices would be a bid to "ignite the video part of iTunes," which has not brought a great deal of money to Apple as yet. Amazon and Netflix currently offer downloadable TV shows and programs, along with YouTube, and Hulu is in the process of converting from a free service to some kind of paid model, so the idea's time may finally have come. However, Apple may find that it has competition close to home: Hulu is reportedly modifying its site
to work on the iPad, which will not support Flash.
Apple officials reportedly told Credit Suisse's Bill Shope in a closed-door session that it was hard to sell TV shows for $2
when people can get whole movies for $1 at Redbox kiosks.