Friday, September 07, 2007

What the studios don't get ...

As reported by MacRumors:

According to three people familiar with the proposal, Apple has told networks and studios that it would like to slash the cost of most TV episodes sold via iTunes from the current $1.99 to just 99¢ -- the same as what Apple charges for most music singles.

Apple argues that the studios would end up making more money with an increase in volume of sales, but the studios haven't been convinced. One concern raised is that potential impact these prices would have on DVD sales which have traditionally been an important source of revenue for the studios.
Case in point: NBC Universal just released "Heroes" on DVD, with most retail outlets charging about $40 for the set of 23 episodes. If Apple had its way, the same set of episodes would cost less than $23, potentially making the DVD -- despite its myriad bonus features -- less appealing to consumers.

According to insiders, while skeptical of the plan, the studios have not rejected it outright, and acknowledge that "library titles" of older content may make more sense at the lower price. Historically, however, Apple has been insistent on consistent pricing across the board.

Why don't they get that it doesn't cost the studios ANYTHING to sell on iTunes! NOTHING .... NADA! It's all profit! No DVD costs, no box printing costs, no bandwidth for the downloads ... NOTHING! That is the difference in price! I can almost assure you that all that fancy packaging and all those bonus features cost a lot to produce and to distribute.

Besides ... I'm too lazy to get up and go buy a DVD. I'll either Neflix it, stumble upon it, be gifted it, or download it.


Anonymous said...

the studios get threatened by WalMart big time if they do anything that might encroach DVD sales. At this time they believe they can't survive without the Arkansas giant, so I think that's also part of the reason to not get too agressive with online sales. I will never understand why they don't realize that the increase in impulse buying alone would be huge.

One other thing this brings to light is that most "extras" on DVD sets aren't worth that much to consumers.

FYT said...

I have to agree about the xtras and disagree ... I already had The 300 on DVD and on torrent on my computer BEFORE it came out. However i was interested in the DVD extras which were great. Extras were also VERY IMPORTANT on Pan's Labyrinth. In the case of these two movies - I would pay for a download on iTunes AND buy the DVD.