The Revolution Will Be Televised… Or Not

Apple’s relaunch of the Apple TV excited me in a few ways: first and foremost was the price drop.  I was never willing to commit $229 towards the original, and neither were most people.  At $99, however, it’s dangerously close to being an impulse buy (at least insofar as impulse buys exist in the world of electronics).

I also believe going to the $0.99 TV show rental model was a good move, too.  I know there are some who say they’d rather own the individual episodes (a la the original $1.99 purchase model), but the rental setup makes a lot more sense to me.  I would buy a season DVD/Blu-ray set of a show, but I wouldn’t just own a few episodes from a given season, as if they were tracks on an album.

However, I think there are a number of things that need to happen before these specialty set-top boxes succeed:

1. Episodes need to be available as soon as possible on the iTunes Store.  Preferably before broadcast, or right after.  Not the next day.
2. Apple should offer a second model that features advertising (with reduced cost or free episodes).  They could even feature those high quality iAds.  Imagine a model where you subscribe to your five favorite shows that air once per week, and your Apple TV auto-queues those for you for streaming on demand.  And it’s free and ad-supported.  Or if not, you can pay the five dollars a week ($20/month) to only see the shows that matter to you.
3. Apple needs to land all the major networks plus a few premiums: ABC, CBS, NBC, Fox, HBO, and Showtime.  In time, they could add a few of the traditionally cable channels, like USA and TNT.  For the premium stuff, Apple could charge $1.99 for rentals (especially since premium shows are usually 12 episodes long, so a season would cost the same as a network television season).  The trouble is that networks like NBC say the $0.99 model is too cheap, but I’m not sure how they can justify charging more than $24 a season (assuming a season is 24 episodes) in a view-once model.  The DVD sets usually run $40 – $50 per season, which gives the purchaser the ability to view many times as well as access to special features.

An interesting compromise would be to allow developers to create iOS apps for the Apple TV, as suggested by Leo Laporte and friends on MacBreak Weekly.  One could have a homepage that had all of the different “channels” on it: an ABC app, CBS app, etc.  That would permit each station to come up with its own pricing terms.  That said, I think if all would agree to just co-exist in the iTunes Store, it would be more elegant and less wild west.

Either way, I’m highly tempted to purchase one, though I’ll probably give it to my brother.

On a side note, the Remote application that Apple updated works beautifully with iTunes.  I understand it also works very well with Apple TV and I look forward to trying that.