Apple iTunes and video

Forrester research has a report indicating that Apple has not gotten much traction with video on the iTunes store compared to audio.

The executive summary reads thus:

Apple’s appetite for a slice of the video pie has proven bigger than its reach. The iTunes video experiment of selling TV shows for $1.99 and movies for upwards of $9.99 — although a great service to the 4% of online adults who regularly buy video on iTunes — is not a mainstream model. Importantly, it won’t translate into what Apple really wants: increased demand for sophisticated hardware like the iPod touch and Apple TV. Those devices still have a role, but they won’t go beyond early adopters without opening the business model to include video experiences not offered today. Media strategy professionals take note: there’s still plenty of opportunity to stake a claim in video territory.

Here are some suggestions on how to improve video on iTunes, though I don’t think there is much new here:

  • Add movie rentals. The real competition here is not other online movie places, but Netflix.
  • Add rental option for seasons of shows. I might want to buy single shows, but I am more likely to rent a season.
  • Movies are too expensive, I can get Ratatouille on iTunes for $12.99, or I can get the DVD on Amazon for $14.99. $2.00 more will get me better quality and I can play on any DVD player, as opposed to being limited to authorized devices.
  • Improve the AppleTV, adding a DVD player inside, as well as adding DVR capabilities.

Finally music on iTunes is a success because it less expensive buying it there than on a CD in a store (or even Amazon). The is no comparable savings with video.


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