On the eve of the "Dawn of the Tablet," Apple is pushing television networks to drop their prices on TV shows to $1 per episode, half of the current $1.99 most episodes on iTunes cost to download. The move has been met with resistance from networks and programmers who are worried that Apple's bite may wreak the same havoc on sales of premium content that iTunes has had on the music industry. CD sales have been in a state of freefall for years, but plenty of pundits says at least part of the blame rests with the popular music download site.
Apple is hoping that cutting prices on TV shows will help boost lagging sales, just in time for the launch of the much-anticipated table, which is set to be unveiled Wednesday. Industry analysts say video sales make up just a small portion of the $2 billion that iTunes pulls in annually. Senior television executives told the Financial Times that the industry expects Apple to push hard for price cuts on premium online video following the launch.
This is the first time Apple's desire to restructure online video prices in iTunes has come up. But, Apple has been dancing around trying to take a bigger piece of the online video market for several months.
Late last year, the company sent up a trial balloon offering TV execs an Apple-based $30-per-month video subscription a la carte service.
- see this FT story
Apple online TV play gains momentum
Apple shopping $30-a-month video service