With just a couple of weeks to go before the iPad launch, Apple is having a hard time getting big content providers, like TV networks and publishers, to cut deals on providing content for Apple's new device. The Wall Street Journal reports
that Apple is scaling back its plans in the face of resistance from the content providers, and observers are wondering if the lack of attractive content may cause iPad sales to stall
after enthusiasts - who have helped push iPad pre-orders near the half-million mark
- are done buying.
Apple has made much of the iPad's multimedia capabilities since the product announcement back in January. Calling it a "magical and revolutionary new device," Steve Jobs sat on a couch the stage at the Yerba Buena Center for the Arts in San Francisco and showed off how useful the device was for not only web browsing, but also watching TV and movies, and reading newspapers and magazines. However, the licensing deals for the TV and newspaper content have not materialized, as companies are nervous about the iPad cannabilizing their traditional revenue sources.
According to what the Journal
report refers to as "people familiar with the matter," Apple is being forced to give up its plans to provide an "all-you-can-eat" subscription plan that would have allowed users to watch unlimited TV programming on their iPads for a flat monthly fee. The major networks are having second thoughts about the idea, worrying that it might cut into their revenues, including the billions they get from their deals with cable TV carriers and satellite networks. Reportedly, Apple is pushing hard to sell them on the idea of lowering the price per TV episode to $0.99 US from $1.99 or $2.99, arguing that increasing iTunes sales would be a new source of income.
Similarly, publishers of newspapers are also resisting Apple's overtures, and the same report says that these deals are being put "on the back burner" for now. One of the main sticking points appears to be Apple's lack of support for Flash content on the new device, which many companies use to serve ads and other content. the publishers are reluctant to rework their sites to work around Apple's disdain for Flash, meaning that the notorious "blue Lego"
will continue to haunt the iPad browsing experience.
One bright spot for Apple is the apparent excitement among book publishers for the new device. Deals are reportedly already set with major and independent publishers including Hachette Book Group, HarperCollins Publishers, Macmillan Publishers, Penguin Group and Simon & Schuster, and the new iBookstore should have a broad assortment of titles available when it launches. Users will also have the option of loading content that is encoded with the open ePub standard, and both Amazon and Barnes & Noble have announced that they are developing iPad apps for their e-book offerings.