More TV Executives Weigh In on 99-Cent TV Show Rentals: Viacom Out, CBS on the Fence

[samcraig]

The uphill climb Apple has is similar to one he is still having with the publishing industry. The issues might be different. But the result to the end user are the same.

Either the product will be overpriced. Or not available at all. Both are "problems" of the iBookstore

 

[djrobsd]

Thing is, bulk of viewers want their preferred shows dictated to them - which requires a network TV channel.

Remember (and all Internet TV hopefuls miss this): the TV model is "turn on, pick one of a dozen channels, watch whatever is showing." Whoever makes an Internet TV device that dead simple (or at least IQ 60 simple) with sufficiently engaging shared-experience material will win.
Apple TV still misses that winning paradigm. It will for $0.99 get you what you request, but most viewers don't want to request, they want to sit back and be given with zero effort.

The world has changed. Only people who don't have a life and watch 6 or more hours of TV a day would most likely not want to CHOOSE what they watch. For the rest of us in the 21st century who are busy and have an active lifestyle, we want to be able to choose what we watch and when we watch it.

The networks are outdated dinosaurs who will fail if they don't get with the program. At a 99 cent price point, consumers won't blink twice to pull up their favorite episode and watch it, or show it at a party when friends are over... But the higher the cost, the less likely people are to buy into the model. After all, let's say you watch 5 shows a week and they want 3 bucks a show. That's 15 bucks x 4 = $60 bucks a month. I can get an HD DVR with basic cable for about that much through my cable company and then record all those shows and many more for the same cost. Plus with DVR they never expire, so I can keep them on my DVR and watch over and over for a long time.

At 99 cents, 4 shows a week = $16 bucks a month, a LOT cheaper then cable and a lot less work.

Maybe Apple should compromise and let them throw in 2-4 30 second commercials at the 99 cent point, I'd still pay that.

 

[m4c1nt05h]

please forgive me if this has been covered before.

one of the biggest reasons i have not bought a device like the AppleTV is for brand new episodes and live TV.

how can something like Roku or AppleTV cover this area? i really like watching a brand-new episode of a show during a new season or watching a live sporting event. i would rather not buy, or even stream a new show for free, after it's been played already. sometimes i would like to watch live news as well.

i don't know how you could do this with an AppleTV besides having to buy a DTV antenna or keep my cable subscription.

 

[stickyd8]

I really don't understand what these execs are thinking. Renting for $.99 is likely going to make them more money than having people buy episodes at $2.99 or $1.99 a pop, because more people are likely to rent than buy. I personally don't buy tv shows because the chances of me ever watching them again are slim. But if I miss something on television I might consider renting it for $.99, or even getting a whole season via rental that way. Now, if I get into a new tv show and want to watch the whole season I just put it on my Netflix queue. Buying a whole season of a program - especially those with 20+ episodes - is damn expensive.

I don't get it either.........Why doesn't Apple put iads into the shows/networks that are hesitant? Make those Episodes free (like Hulu and other players). If they offered both options to consumers, then they would get more bang for their buck. I'm more apt to buy a TV show or movie after I've rented it to see if I like it. Networks just don't get it. They are so stubborn and afraid to leave their old model, they are killing themselves.

I also believe NBC/Comcast have alternative motives for remaining out of this. They have their own Player in Hulu that generates ad revenue. However, I don't see how they could lose money by renting their shows at .99? It makes no sense. **** 'em! I'll just wait until they come out on Blu-Ray, rip them to my computer and stream them to my AppleTV then. I can wait a few months to see any show!

 

[tripjammer]

in the last few seasons of Friends i heard the cast was being paid something like $20 million per episode. figure another $10 million in production costs per episode.

that's $30 million just to lose money because you could have put it in T-bills and come out ahead.

i've also read the big shows like Friends lose money or break even on the first run and make money on syndication. my wife is always watching old episodes of seinfeld, friends and other shows.

renting via iTunes would be too expensive compared to paying for cable for us. and the networks putting these shows on itunes would kill the syndication market and wipe out profit. and you have to be crazy to pay $.99 per episode when cable is $75 a month for unlimited viewing and $130 a month if you include home phone, internet and DVR

HBO costs $15 a month because shows like Rome cost $175 million to produce

the appleTV has a place but it seems to be to keep Boxee, Roku and GoogleTV at bay. it's not going to replace cable except for a small niche

Nope in a year.....cable and dish will be hurting by the $99 apple tv that also does apps. Show me a cable box that will do apps.

Apple aint done with this thing yet. We all know apps are coming thats why the new apple tv runs ios.

 

[ctdonath]

putting these shows on itunes would kill the syndication market and wipe out profit. and you have to be crazy to pay $.99 per episode when cable is $75 a month for unlimited viewing and $130 a month if you include home phone, internet and DVR

But not all shows get syndicated. Apple could get a good start by focusing on "the long tail" of huge numbers of shows which have an awaiting audience but nowhere to watch them, plus those many shows that would be available but have no willing network to carry them.

As for the crazy $0.99/episode pricing: for those of us who hardly watch TV, that's an awesome price. I'm paying for internet service anyway, don't want a home phone, and save for Netflix, RedBox & library don't watch TV; for the 4-8 episodes I'd watch a month, that's dirt cheap (and on-demand makes the DVR moot). $75 unlimited equates to 37.5 hours of half-hour episodes at $1/each; if I'm watching a work-week's worth of TV a month I need to go do something useful instead. Some people have different viewing habits, making a market to profit from.

The one thing TV is missing AFAIK: live/breaking coverage. On-demand TV is prerecorded-only, and websites (esp. streaming video feeds) tend to melt down upon major news events.

 

[alent1234]

The world has changed. Only people who don't have a life and watch 6 or more hours of TV a day would most likely not want to CHOOSE what they watch. For the rest of us in the 21st century who are busy and have an active lifestyle, we want to be able to choose what we watch and when we watch it.

The networks are outdated dinosaurs who will fail if they don't get with the program. At a 99 cent price point, consumers won't blink twice to pull up their favorite episode and watch it, or show it at a party when friends are over... But the higher the cost, the less likely people are to buy into the model. After all, let's say you watch 5 shows a week and they want 3 bucks a show. That's 15 bucks x 4 = $60 bucks a month. I can get an HD DVR with basic cable for about that much through my cable company and then record all those shows and many more for the same cost. Plus with DVR they never expire, so I can keep them on my DVR and watch over and over for a long time.

At 99 cents, 4 shows a week = $16 bucks a month, a LOT cheaper then cable and a lot less work.

Maybe Apple should compromise and let them throw in 2-4 30 second commercials at the 99 cent point, I'd still pay that.

add $40 per month internet and you're at $56 a month which is the cost of basic cable in NYC. i'll keep my cable for now

 

[alent1234]

Nope in a year.....cable and dish will be hurting by the $99 apple tv that also does apps. Show me a cable box that will do apps.

Apple aint done with this thing yet. We all know apps are coming thats why the new apple tv runs ios.

rumor is that the next x-box can be used as a U-Verse cable box as well

appleTV doesn't have apps either and when and if it does you will probably have to buy a new one and this one won't support them. so there is no reason to run out and buy this one

 

[rotax]

"We value our content a lot," he said. "We don't think Apple has it quite right yet."

Just keep waiting like you have been. Wait until you are finally extinct.

Exactly right! Just like BlockBuster. Besides, how much more bandwidth would a service have once they got rid of all the bundled bs channels no one ever watches but that are required in a package deal. Ala cart all the way.

 

[cocky jeremy]

He's right about one thing. 99 cents isn't a good price point. Try 40 cents or something closer to that. 99 cents for an episode i can watch for free? No thanks.

 

[E.Lizardo]

Wow, this is retarded! Why don't they provide the $1.99 version for RENT OR a free version with commercials in it or iAds or something to get them the revenues the want.

Gee,if you want to RENT shows for 1.99 why not BUY them and then DELETE them after watching?

 

[Ochyandkaren]

Seriously, I feel bad for the people who waste their life watching television.
Television, stunting human momentum since 1938.

Oh, and Fox sucks.


---
Go 

: Unfortunately we are in minority!

 

[ArcaneDevice]

The way to get networks to join up is to open the platform to other codecs.

No, the way to get networks to join up is to get AppleTV off Apple devices.

The reason the networks are all turning this down is because AppleTV is a niche product with a closed platform and limited audience reach.

You just saw this in effect this week when NBCU signed a deal with Netflix to provide more cable shows and SNL episodes to Netflix. With that deal they instantly gain a prospective audience of millions because Netflix has an app on almost every new consumer electronic device on the market - regardless of brand.

Same applies to Hulu+. It's already available to more eyes than AppleTV will ever reach.

And the list goes on. Apple are playing catchup here. All new consumer media devices are adding more and more content from more and more partners all accessible with a few clicks, because manufacturers are making it easy for networks and VOD vendors to add their own content into the device software.

If Apple wants to get more network involvement they need to make an AppleTV app to slot into the existing systems already propagating this content. That means working with Sony, LG, Panasonic, Samsung, Boxee, Roku, Oppo, Toshiba etc. etc.

That is something Jobs will never do and that's why AppleTV will stay the same niche product it always has been.

 

[E.Lizardo]

I really don't understand what these execs are thinking. Renting for $.99 is likely going to make them more money than having people buy episodes at $2.99 or $1.99 a pop, because more people are likely to rent than buy. I personally don't buy tv shows because the chances of me ever watching them again are slim. But if I miss something on television I might consider renting it for $.99, or even getting a whole season via rental that way. Now, if I get into a new tv show and want to watch the whole season I just put it on my Netflix queue. Buying a whole season of a program - especially those with 20+ episodes - is damn expensive.

I think DVD sales are one thing they are looking at.Until that cash cow declines it looks like it will be a big factor in their math.Personally I buy or rent zero video from iTunes,yet ordered the aTV(to replace my original model).I'll use it for netflix,to stream music,photos,and video from my computer,and hopefully Boxee will soon be available to add Hulu and more.Then of course the official content Apps that are bound to come,such as ABC player etc...

 

[ArcaneDevice]

one of the biggest reasons i have not bought a device like the AppleTV is for brand new episodes and live TV.

how can something like Roku or AppleTV cover this area? i really like watching a brand-new episode of a show during a new season or watching a live sporting event. i would rather not buy, or even stream a new show for free, after it's been played already. sometimes i would like to watch live news as well.

Simple, buy a device that supports Hulu+. There are plenty on the market now.

Your Hulu+ monthly subscription gives you instant access to new shows as they air.

http://www.hulu.com/plus#devices

 

[E.Lizardo]

Unfortunately, the amount of content available for the Apple TV continues to decline.

citation needed

 

[bitfactory]

Seriously, I feel bad for the people who waste their life watching television.
Television, stunting human momentum since 1938.

Oh, and Fox sucks.


---
Go 

Fox owns FX which shows Always Sunny, Sons of Anarchy, and The League -- 3 of the best shows on TV.

Don't quit your day job.

 

[E.Lizardo]

lets see ABC effectly has job as a biggest vote so it should not really count.

Other networks so far have effectly said no. Sounds like they do not want to be held by the ball by Apple. They watch how Apple strong armed the record companies. For example not letting them cut other deals with iTMS competitors like Amazon. Price point forcing and so on.

Sounds like they refuse to get into that game. So far all the shows I watch are owned by networks that have said no. As soon as CBS says no that is all the shows. iTunes will have none of the shows.
Also the fact that it ties ONLY into apple products is hurting Apple cases. If iTunes could stream to 360, blu ray and so on they might be more open but as it stands Apple will only stream threw a computer directly connected to the TV or POS known as Apple TV.

When did that happen??i know since I've been visiting Amazon they are often cheaper and have lots of specials.

 

[alent1234]

amazon used to have better deals on music that steve jobs made the record companies stop

 

[ArcaneDevice]

Nope in a year.....cable and dish will be hurting by the $99 apple tv that also does apps. Show me a cable box that will do apps.

Cable boxes don't need to have apps when every other device (such as TVs and Blu-ray players) is heading that way.

It's already in full swing with some companies and they throw it into the device for free, not as a raison d'etre:

http://www.samsung.com/us/samsungapps/
http://www.lg.com/us/netcast/index.jsp
http://www2.panasonic.com/consumer-electronics/learn/Televisions/vieracast
http://www.sonystyle.com/webapp/wcs...Id=10551&langId=-1&cmsId=STATICS_BIV_showcase

 

[HyperZboy]

This is not surprising at all for just starting out. NBC/U has both Hulu and soon Comcast so they're not looking for any distribution method like this and probably will never sign on.

However, I bet if CBS changes its mind and jumps on board, I think others like Viacom will quickly follow. And there's always the possibly Jobs might change his mind too and allow more flexible pricing. He's already backed down on that before on music, so you never know.

 

[RalfTheDog]

One problem with the apple model is that all shows cost the same. Advertisers pay different amounts based on ratings but on the apple store revenue is the same regardless of rating. I bet the networks are looking at their most popular shows and figuring that they need a higher price. The marginal and les popular programs are probably not the problem.

Per download is better than ratings. Ratings say, "We think this many people are watching this show. Downloads tell us exactly how many people were willing to pay for the show.

I think the days of commercial TV are dead. Does anyone watch commercials anymore? That is what the FF button on the DVR is for. In 10 years, the only commercials that will count will be product placement and perhaps a, "If you like this show, please check out..." before the show starts.

amazon used to have better deals on music that steve jobs made the record companies stop

That is because Amazon was breaking federal law, selling their product below cost to corner the market.

 

[law guy]

What seems odd about this to me is that we're talking about a short rental period. NBC already offers .99 rentals of the Office and 30 Rock with Comcast On-Demand. There may well be additional payments that make that price work for certain folks in that model.

But again, $0.99 seems like a lot to me to be able to watch a show once and isn't $.99 better than $0 - I mean, we're really talking about shows where if we're on the ball, we're likely to have them on the DVR automatically with no cost to us other than the fixed costs of the cable or other content provider, so I should say - at no incremental cost to us.

$.99 is already more than what seasons are priced at to own, e.g. a 40 episode season might cost $29 or $36 ... and that's to own ... and be able to watch more than once ... without being limited to a 24 hr period.

This sounds like gamesmanship in the negotiation rather than what they really think their content is worth for a 24 hr rental.

 

[alent1234]

Cable boxes don't need to have apps when every other device (such as TVs and Blu-ray players) is heading that way.

It's already in full swing with some companies and they throw it into the device for free, not as a raison d'etre:

http://www.samsung.com/us/samsungapps/
http://www.lg.com/us/netcast/index.jsp
http://www2.panasonic.com/consumer-electronics/learn/Televisions/vieracast
http://www.sonystyle.com/webapp/wcs...Id=10551&langId=-1&cmsId=STATICS_BIV_showcase

i just bought a new TV. a model with internet, netflix and youtube is $200 more than the exact same one without internet. so i bought a cheaper TV and a PS3.

 

[mtwilford]

I think that .99 price for a rental of a TV show is way too expensive. I believe that if they lower the price, they would get more action. iTunes have several shows that had season for $14.99 and I purchased, all seasons of Criminal Minds, Numbers and several season of NCIS. I wish that they had kept the price point for a little longer, I didn't get all the season of NCIS. For some of these shows it was like .42c per episode!