updated 11:05 pm EDT, Tue August 24, 2010
More details of 99c iTunes TV rentals emerge
Apple's ongoing discussions for 99-cent iTunes TV rentals were given support today by a pair of sources Tuesday evening. Anonymous contacts told the WSJ this evening that Disney was the closest to a deal and could agree to allowing some ABC shows soon. It's speculated that Apple chief Steve Jobs' position on Disney's board of directors would be a strong influence on the plan.
News Corp., which publishes the newspaper breaking the story, is also billed as "receptive" to the deal for the Fox network, though there were unspecified but "significant" obstacles to landing a deal. NBC is also talking, but CBS is purportedly resistant to an agreement. It remains the lone holdout from Hulu's free service and may only now be joining Hulu Plus due to its paid system.
Tips to Reuters have corroborated many of the details but clarify that CBS and NBC both believe the TV show rentals would undermine their existing revenues, which give them $2 per episode. The WSJ contacts claimed that Apple is using customer reaction as a strategy; many see the current rates as too expensive, and networks could make up for lower prices by increasing the number of downloads.
Both media outlets were told Apple would provide a 48-hour rental window for any TV show, though the insiders didn't supply more technical details. Apple is thought to be pushing hard for a deal not just for a rumored September 7 media event to introduce the iTV but also before the fall TV season begins the same month.
Regardless of agreements, Apple faces stiff pressure to lower the rates for adopting TV shows. At $10, Hulu Plus would give unlimited access to many current TV shows. Apple's proposed iTunes rental system would potentially be more expensive for frequent viewers, but it would allow a moderate viewer to watch every new episode of two shows for a full month for $8 and would still be more competitive at $12 for three shows.