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Study Says No Future for Video iTunes
eldavojohn writes "Reuters is running a story on a study that claims "Online video sites that sell shows and movies such as Apple Inc.'s iTunes will likely peak this year as more programming is made available on free outlets supported by advertising." Many channels have wised up to offering their content hosted from their own sites for free — with commercials — to cut out iTunes as the middle man. End result? Predictions that services like iTunes-Video have no future."
I could see them making a nice chuck of change. Think about the amount of travelers alone who have iPod's... Imagine a USB based kiosk at an airport with movies for downloads. Or... Even a USB next to your chair which would allow you to rent/buy movies at will... How many people get on a plain/train each day... All you need is a fraction to buy a movie. Its apparent whoever wrote the article is not thinking out of the box.
Infiltrated dot Net
Actually, iTunes shows are not without commercials. Many of the shows have commercials embedded in the movie file. What they are is without commercial interruptions. Commercials are placed on the tail end of the video where you can choose to watch them or shut off the playback. This is vastly superior to the DVD solution of, "you MUST watch these commercials every time you turn on this DVD."
I don't know about anyone else, but I actually like seeing occasional advertisements. Especially things like movie trailers and new show promotions. My problem is that I don't like being forced to watch them repetitively. iTunes gives you the best of both worlds in that respect, and in a way that is unlikely to offend the die-hard anti-commericalists. (Dare I say it? Anti-commercial Nazis?)
Javascript + Nintendo DSi = DSiCade
I sometimes wonder if stories like this (or the breathless "iPhone is gonna generate more revenue than a patent on oral sex" stories) are intended to briefly move the stock price one way or another. It would be interesting to study the AAPL movements against key announcement, headlines, rumors and actual performance. I supose we wouldn't learn much, only confirm our intuition that headlines and rumors affect the short term and performance affects the long term, but it might be fun.
If you mod me down, I shall become more powerful than you could possibly imagine.
There is no future for video because, how often do you want to keep watching the same old video again and again. With songs its different, but watching a movie again and again just dosent cut it, unless of course its porno!!!
I think it's pretty obvious that downloaded shows make a lot of sense at the moment. So do DVDs of shows - it's convenient and you can use them offline.
Imagine a future, though, where wireless broadband is cheap and ubiquitous. Subscription websites generally do poorly and people are willing to sit through advertising in order to get something they want for free. If I can tab to another web site during commercials, I probably don't care that things are delayed for a couple minutes.
Eventually, the issue will be about time. Some people's time is valuable enough that they'll purchase the DVD or download the series. For the masses, the commercial approach is fine for them. Personally, I think it's good to have choices.
I'd like to think there's room to mix and match, just watch the shows you kinda like and buy the ones you love. Joost really needs content and the buy-in from CMS, Viacom, Hutch and others makes it an interesting proposition and the BBC's iPlayer will hopefully cause chaos to all those ratings muppets! See blog for thoughts on them...
If he's the Walrus then can I be a penguin please?
Seriously. If the history of media tells us anything, it's that people by and large prefer to own their content. Hence the success of VCRs. Hence the success of DVD box sets. Advertising supported streaming will appeal to some subset of viewers who just want to be able to catch an episode they missed, but I highly doubt it will cut into the Video iTunes market in any meaningful way. The services are barely even comparable. One chains you to your computer to watch, gives you little opportunity to ffw, pause and otherwise control your viewing experience, and has low quality to boot. The other is highly portable, gives you complete control* of the viewing experience AND is high quality. There may be a little overlap in the markets, but I doubt it's much.
* Modulo DRM crapola preventing you from device shifting your content
I have friends all over the world who record my favorite shows, expunge the commercials, and let me borrow them! I don't pay a cent except for bandwidth, and if I like the show enough I'll buy the DVDs to support the artists (Venture Brothers, maybe the next Simpsons set, Family Guy, etc...).
It works great, just like asking your neighbor to tape your favorite shows when you go on vacation.
Oh...the bad part is, the media companies can't make any money off of it.
Blar.
There was a time in our history when the world-as-you-knew-it was the same one that your parents knew, and would be the same one that your children would know. The division of social classes, their economic wants, their means of fulfilling those wants, their cultural values, etc., did not change over one, two, or even three generations. In that environment, the concept of the "economic man," and the whole business of making predictions based on the science of economics, had some genuine effectiveness to it.
In these times, all the above listed factors change every decade. Not only do we know very little about what world our children will face, we know very little about what our own values, needs, and means will be in the next ten years. Because of this rapid pace of change, by the time any sort of economic model has enough data upon which to base predictions, all the data no longer apply.
Therefore, as far as I am concerned, all such analysis are little more than crystal-ball review.
The risk-takers are the ones who shape our world from one decade to the next, and the unknowns are just too high to say with confidence which risks are worth taking. There are no safe investments, but the betting window never closes.
As an example on this, let's take myself.
I love watching LOST, but I am awful about actually sitting down and watching it when it is on TV. I always miss it.
Back during Season 2, I was still catching up. I really wanted to watch the episodes that I missed. I had missed a lot of them. So, I figured $2 is worth the price of an episode. I went to iTunes, and I bought about 12 episodes of Season 2 to catch up to where I needed to be. It was really cool, the quality was good, and I was pretty happy with it.
Fast forward to now.
I still miss LOST regularly, but I don't buy it from iTunes anymore. I go to www.abc.com, and I watch it online. I can watch it in full screen, and I just have to sit through a 30 second commercial a few times per episode. I consider that a free trade, considering that if I was watching it on TV, I'd have to sit through FIVE MINUTES worth of commercials several times per episode.
The only issue I have with the ABC content is that sometimes the streaming isn't quite fast enough, and the video feed can get locked up. I don't have to deal with that on iTunes. Also, you can only go back 4 episodes. So, if I missed an entire season, I couldn't get it on ABC.com. However, I would imagine that ABC has something in the works to rectify this situation.
In summary, I'd rather watch a few commercials than pay $2 for an episode if I am given the choice.
UNLESS
I want to burn the episode to DVD to watch later. THEN I want a high quality digital copy with no commercials, and I'd pay $2 for it. Unfortunately, iTunes doesn't allow you to burn video to DVD, so I can't win on that front at all. If Apple can get rid of the DRM requirement on their downloaded videos, to let you burn them to DVD, I can see a market for them. Otherwise, eventually the free content will win.
You know... My first internet connection was on two leased line 9600 bps modems. We had a Siemens server running SINIX and a couple graphical workstations running Collage. My first post-web home connection was my trusty 14400 US Robotics I already used for BBSs. I still have it and it still works.
Of course, it was before the web.
In ten years, my home internet connection became five hundred times fatter. If we disconsider clever compression techniques that could be invented in the meantime, we can imagine that a 10-fold increase would be required for HD movies to be feasible.
Just seeing how fast broadband was adopted here in Brazil (first at 256Kbps and these days in the Mbps-range) accompanied by a sharp drop in prices, I can't imagine not having a link fat enough for HD content delivery in 5 years.
People tend to forget that whoever offers video subsidized by commercials will do whatever they can to prevent you from skipping them.
I think that the videos you will be able to purchase on iTunes will still cater to the normal Apple audience: those who can pay a little more for a whole lot more convenience.
http://www.dieblinkenlights.com
This will go on/off topic as I stream of thought this, but here goes:
Why do we even have to pay for television? Look at terrestrial radio: Commercials, talking, etc., but it's free. It's supported by advertising. Why isn't television the same way? Why should I have to pay $40/month for basic cable and still have to be bombarded by crap advertisements and junk I don't want to see? I understand the need to recup the initial hardware fees and such. It costs money to lay cable lines, install outlets in homes, etc. That's why there are up-front installation costs. After that, I shouldn't be required to pay to watch crap I don't want to watch. Satellite radio: $10-$15 a month, commercial free. I'd gladly pay for that. (Yes, I know that tv/radio are very different forms of communication, so keep reading...)
This goes back to the whole theory of people being overpaid. My cable bill is high because athletes and actors are way overpaid to do what they do. Yes, I understand that most athletes and actors are the best at what they do. No, I couldn't personally go grab a basketball and dunk over Shaq. That's not my point here. The concepts revolve around the fact that there are TONS of people who would love to act, play basketball, etc. and would do it for less money. It's why a movie ticket is now almost $10, and the cost to get an NBA nosebleed seat is nearly $40. And so what happens when "Terminator 2: Judgment Day" comes out on cable? Nearly 45 minutes of it's 2 1/2 hour timeslot are junk crap commercials. What's the special notation at the beginning of the movie? "Movie has been formatted to fit your screen" and "Edited for time". Don't edit it for time! CUT OUT THE DAMN COMMERCIALS! Maybe an actor does deserve to get paid a lot. Problem is, not every movie that comes out is like "The Green Mile" or "T2". There are plenty of "Larry the Cable Guy: Health Inspector" movies to go around.
And so then we stand back and get to the point where people record shows on their TiVo and computers, cut out the commercials, and post on the internet. Then, the production and broadcast companies yell and scream because people are skipping their commercials. Hmm... I'm not going to waste my life away watching your stupid advertising just because you think I need to be bombarded for another 15-20 minutes by tampon, erectile dysfunction, and overpriced consumer commodity commercials.
Solution? There's on-demand movie channels... So make on-demand advertising channels. In the market to buy a new car? Flip to channel 121 to see ads from Ford/Chevy/Toyota/etc. Want the newest drug to keep your penis erect? Flip to 167 to watch the newest pharmaceutical ads. Want to see ads for new products that have been around for 6 months or less that you don't know about yet? There'll be another channel for that. Let people target themselves for their advertising! Don't try to fit me into some demographic slot and then shove crappy commercials at me.
So to get back on topic (I told you I'd be meandering here), I completely understand why people pay for ad-free tv shows. I just hope they're not screwing themselves and double-dipping by paying a cable bill as well. The market for iVideo dying? Doubt it. Those who can pay for it will. Those who can't will still download off the net. And the have-nots, well, they won't be reading this post because they are too busy trying to pay their rent to worry about broadband or cable bills. At least we are fortunate enough to have the problem of getting to complain about too many commercials.
TV is dying because Cable is so damned expensive if I want anything more than the bare minimum. It is especially expensive for me because I don't want to use them for internet and phone. They've pushed to far with the bundling. To get your money's worth, you need to go all or nothing. So I chose nothing.
I can take out/skip the commercials. That is no problem anymore. A TiVo or similar woudl actually be more convenient than downloading. It is just so much cheaper to just manually download the 5 or so weekly shows that we watch, Netflix the movies (ondemand had a terrible selection last time I checked), and get the HD PBS over the air.
Of course, when I say "download," I mean bittorrent. So I guess I'm cheating a little bit.
-matthew
"THERE IS NO JUSTICE, THERE IS ONLY ME." -Death
So my dad works for a company that is taking there entire video library online in a few months. its going to be available for streaming and download for free (with advertisement) as well as pay download (commercial free). the part i think is the coolest is that when you vote on the video and or discuss it, you help the company choose wheater or not they will distribute it on DVD and possibly theaters. Also film makers will be able to submit there films to possibly recieve a distribution deal. which I think is the way every company should be with film. For there next production they are also go to have users help select cast members based of screening performances as well as host a music writting contest where anyone can submit an original song or score for a chance to with 10,000$ and a contract for the song to appear in a movie.. what are peoples feelings about something like this?? Is this the future of media?? please I want to hear what other people think??