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Apple to rent TV shows for 99 cents each?

Apple may rent episodes of TV shows for 99 cents each instead of selling them for $1.99 or $2.99 a pop, according to two reports--which also indicate that the Cupertino, Calif., company will finally update its Apple TV media receiver.

Bloomberg News's story says Apple is negotiating with News Corp. to make Fox shows available for 48-hour rentals. They would show up in the iTunes Store 24 hours after airing and would appear without commercials. The Bloomberg report suggests that ABC is also interested but NBC and CBS are skeptical.

itunes_tv_store.png

According to the piece, Apple will announce this new option at a Sept. 7 event in San Francisco that would also feature the introduction of an updated, $99 version of the Apple TV--the iTunes-connected media receiver, made to plug into an HDTV, that Apple has spent the past few years neglecting. In addition, Apple would introduce a new iPod touch with the same high-resolution display as its iPhone 4.

A piece in the the Wall Street Journal backs up those details but portrays CBS and NBC as more opposed to Apple's TV-rental concept.

Neither the Bloomberg nor the WSJ stories clarify whether these rentals would come in high definition or standard definition, but you have to think it would be the former.

I have no inside knowledge of Apple's plans, but I think a TV-rental option would make a lot of sense. Ever since Apple began selling TV shows on iTunes, almost five years ago, I've questioned the wisdom of buying something that amounts to transient entertainment (seriously, how many episodes demand repeat viewing) and comes handcuffed with "digital rights management" usage restrictions (the same reason why I'm less interested in buying movies off iTunes than renting them).

A TV-rental option would also help Apple compete with a growing variety of episode-viewing choices: the networks' own Web sites and such online video hubs as Hulu (now available on the iPhone and iPad through its $9.99/month Hulu Plus service) and Comcast's Fancast Xfinity TV.

All these Web TV-watching choices are benefiting from--and likely contributing to--softening demand for traditional cable and satellite subscriptions. Charlottesville-based SNL Kagan reported last week that for the first time, the number of pay-TV subscribers in the United States dropped:

According to the SNL Kagan analysis of full subscriber counts for cable, DBS and telco video offerings, the multichannel universe lost 216,000 customers in the second quarter, versus a 378,000 gain reported in the same quarter last year.

The report suggested that much of that decline could be explained by the weak economy, but you can't ignore the role of online video sources. What effect would an iTunes TV-rental option have on that market? How might it change your own vewing habits? Let me know in the comments.

By Rob Pegoraro  |  August 25, 2010; 11:10 AM ET
Categories:  TV , Video  
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Comments

What affect, if any, would that have on the present On Demand or network website services? Do you think the networks would focus on the rental market and abandon the pre-paid cable audience? It would cost me a fortune to rent episodes I presently time-shift using On Demand or the network websites (ABC and FOX). I would buy a DVR before I would rent episodes from iTunes.

Posted by: maxinea | August 25, 2010 11:36 AM | Report abuse

I don't see this taking off, especially for anything you can stream for free on the network websites. The only TV show I've ever bought from iTunes is Mad Men, because there's no way to stream it online and I don't have cable. I have a season pass for Mad Men for $20...I might have considered a season pass rental for $10, where I had 48 hours to watch each episode, but I wouldn't have paid $1 per episode to rent.

I guess the advantage over free streaming from the websites would be watching with no internet access, but that seems like a pretty limited market - how often are you watching TV away from home?

Posted by: amy130 | August 25, 2010 11:43 AM | Report abuse

When will we ever be able to watch live local sports without cable? It's kinda screwy that it's easier/cheaper to follow an out of town team than a local one.

MLB.tv - You can watch any game except the one you actually want to see!

Posted by: cassander | August 25, 2010 11:48 AM | Report abuse

I might be interested in this. I want to watch the new season of Dexter starting soon, but I've dropped Showtime. But then I went to check out the itunes prices for the previous season, and to get all the episodes from itunes would cost significantly more than just going to a store and buying the physical copy. If it were a dollar an episode, I'd be much more likely to go that route. Instead, I'll just wait until netflix or find a friend who does have Showtime (and they lose all possible money I was willing to give them).

Posted by: misere | August 25, 2010 11:49 AM | Report abuse

I would definitely take advantage of this feature. It would be a good backup in case our DVR has a problem recording an episode and the show isn't available on Hulu.

If every show currently available on iTunes came available for rental, I could definitely see myself giving up satellite and going with true a la carte programming. Just invest in a HTPC, and pay for what you want to watch (if you can't get it for free).

Posted by: thurminator | August 25, 2010 11:54 AM | Report abuse

Intriguing... Planning on buying a Mac Mini (it has HDMI output) and an EyeTV dongle for it and using it as an HTPC hooked up to the TV. This (plus hulu plus netflix) could be very handy.

Posted by: wiredog | August 25, 2010 12:37 PM | Report abuse

Tempting...but as long as Monday Night Football's on ESPN (and the Caps, Nats,etc are only on MASN and Comcast) I can't see myself dropping cable.

Posted by: SHLL | August 25, 2010 12:53 PM | Report abuse

I guess I'm the exception in many ways. First, i've owned an AppleTV for a number of years and use it regularly. I've turned nearly my entire DVD collection into MP4 digital files and watch them almost exclusively on the AppleTV attached to the TV in my bedroom or on the Mac Mini computer attached to my living room TV. Furthermore, I no longer buy DVDs if their content is available from iTunes--i simply ran out of places to store them. All this media, my entire DVD video and CD music collections--4 TB worth, is stored on a couple or large capacity (but physically small) hard drives (and backed up on another couple).

Yes, there certainly are TV shows I want to watch again (and again): Band of Brothers, The Sopranos, The Wire, Rome, The Tudors, Mad Men, Sons of Anarchy, Friday Night Lights, Queer As Folk, True Blood, The Pacific and some others. Frankly, as "reality TV" takes over current lineups, I find there is less and less new fare I want to watch. I just spent a couple of evenings rewatching both seasons of Rome because, really, what else was on?

Posted by: BTinSF | August 25, 2010 1:04 PM | Report abuse

PS--i can also watch/listen to all that digital media--movies, TV, music--on my laptop, iPad or iPhone when I'm travelling. Just load the portable devices up before I go. I wouldn't think of lugging CDs or DVDs with me.

Posted by: BTinSF | August 25, 2010 1:11 PM | Report abuse

This is HUGE!

I've owned an ATV for years and use it almost every day. I live in Europe, so downloading iTunes TV shows is the best way for me to keep up with good TV from the states (pretty much all the shows that BTinSF mentioned). Sites like Hulu and the networks' websites are blocked ourtside the US, so I have few options for up-to-date viewing.

Like Rob says, I rarely, if ever, re-watch a TV episode, so renting makes much more sense. It'll save space on my ATV and my computer, adn I'll not have to sweat the decisions to delete shows I own.

Posted by: mbd26 | August 26, 2010 4:56 AM | Report abuse

I'll echo the sentiments of others. If Apple wants to make this fly, they need to serve as a viable alternative to cable. The downside of cable is that users pay a fixed amount for many channels they do not watch. Apple must offer access to specific channels or reasonably-priced season passes to shows in an amount that would make it competitive vis-a-vis cable. They also need to tie iTunes access into a sister website that offers access to live sports.

By allowing iTunes users affordable access to a la carte networks or shows, in addition to live sporting events, Apple would pose a serious threat to cable.

Posted by: terminator_x | August 26, 2010 9:00 AM | Report abuse

Man, I can't wait for this, finally! I can catch up on past shows from previous seasons and watch them in HD on my 50 inch screen. I'm still trying to catch up on 24 and Heroes. And I don't have to buy the episode and have it take up space on my Apple TV. A buck to view and I get my space back. It's about time!

Posted by: clark202 | August 26, 2010 10:29 AM | Report abuse

BTinSF I feel ya Bro.

Posted by: clark202 | August 26, 2010 10:31 AM | Report abuse

It costs $0.99 to rent a movie. Perhaps $0.49 would be a more appropriate price to rent a TV episode.

Posted by: ninjastyle | August 26, 2010 11:52 AM | Report abuse

I already cut the cable and watch 100% of my shows over the internet. Instead of a $100 cable bill, I have a $45 internet bill, plus a $10 netflix subscription.

And for those of you asking, I hooked my mac mini up to my 47" LCD and my sony surround sound. Yes, it rocks.

Posted by: whitneyuevans | August 26, 2010 12:18 PM | Report abuse

Hmm, rent the show for $1 or DVR it for $0...what to do?

Posted by: paul6554 | August 26, 2010 1:06 PM | Report abuse

You (whitneyuevans) were paying $100 for cable?! Wow, you were getting hosed. Both Comcast and Verizon have deals for Phone/Cable/Internet for $100/month.

Posted by: paul6554 | August 26, 2010 1:13 PM | Report abuse

What we really need is a la carte pricing on cable so that when we only want 5 channels, we are not paying for 500. I never watch sports and they are among the most expensive offerings.

Posted by: mdembski1 | August 26, 2010 3:42 PM | Report abuse

Still to expensive .99 for one hour that is 24 dollars a day--total rip off.

Posted by: PennyWisetheClown | August 26, 2010 4:52 PM | Report abuse

I have bought some series from the iTunes Store because I only have Basic cable. The most prominent is "Battlestar Galactica." I would consider renting episodes of a show I have a more than moderate interest in which is on an unavailable channel or network.

But, there is a catch. Premium shows like "True Blood" are not offered for streaming on Hulu and Netflix and likely will not be offered for rent on the iTunes Store. So, I will be left waiting until each season comes to DVD.

Posted by: query0 | August 27, 2010 12:30 AM | Report abuse

Will the season pass option still be available? I only watch one show - NCIS - but I frequently rewatch episodes during the season because they do so many plot arcs. I would rather pay more per episode in order to have them permanently instead of getting the cheaper price and only having it for 48 hours. Also, do networks have to do both? For example, if CBS doesn't want to offer shows for rental, can they still offer the season pass?

Posted by: idahoblackberry | September 1, 2010 1:24 PM | Report abuse

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