Notoriously eager to goose iTunes sales by keeping prices on content low, Apple is reportedly pushing hard on movie studios to price 4K films at $19.99 a unit.
According to The Wall Street Journal, Apple is trying to lock in licensing agreements with Hollywood’s major studios in time for its presentation of its new 4K-capable Apple TV device on Sept. 12 at an unnamed event.
Apple TV has lost share in the race for OTT device supremacy. A study released by Parks Associates last week showed that Apple TV’s share in the U.S. streaming device market has fallen to 15%, well behind market leader Roku (37%).
Apple has in previous years sparked revenue for its iTunes store and its associated digital devices by pricing content low. Certainly, the ability for iTunes to undercut the market on 4K content would benefit Apple TV, which is priced at $149—a 60% premium over other 4K-capable streaming devices.
Meanwhile, iTunes could itself use a little reinvigoration. In July, WSJ reported that iTunes' share of the transactional video market had fallen from 50% in 2012 to around 20% to 35% today, with insurgents Comcast and Amazon nipping away.
“Historically, Apple has looked at the levers they can pull to be competitive, and they’ll have to have richer 4K content to leapfrog other competitors,” said Matt Smith, VP at Brightcove, to WSJ.
But the movie studios want to see a price point $5 to $10 higher than the $19.99 charged for the legacy high-definition standard.
“I wouldn’t tell Apple how to price their iPads,” an unnamed executive at one studio in talks with Apple purportedly told WSJ.