Date: Sunday, June 19th, 2005, 14:28
Category: iPod, Software
The PowerPage is of the opinion that Apple’s new iTunes Music Store is only a precursor to a much larger project: the iMovie Video Store. While the name is entirely speculative it stands reason that the company that delivered the best Music On Demand (MOD) service is poised to deliver another complimentary service that will offer movies and Video On Demand (VOD) at some point in the future. Click the headline to read more.
The PowerPage is of the opinion that Apple’s new iTunes Music Store is only a precursor to a much larger project: the iMovie Video Store. While the name is entirely speculative it stands reason that the company that delivered the best Music On Demand (MOD) service is poised to deliver another complimentary service that will offer movies and Video On Demand (VOD) at some point in the future.
Consider the fact that Apple is a well respected multimedia company, father of QuickTime and home of the number one movie trailer Web site, add a dash of experience with its brand spankin’ new Pay-Per-Tunes service and you have a recipe for Apple’s next truly big thing.
There are a number of barriers to entry for a Video On Demand service that have to be taken into account.
First, Apple is only testing the waters with the iTunes Music Store, if it is a profound flop (unlikely) or doesn’t exactly take off as expected (anything is possible) they could easily scrub a much more expensive video service.
Second, bandwidth is a major consideration. At easily 10x the file size of audio, video presents its own unique set of logistical challenges: server farms must be bigger and wider, support and engineering costs are higher and customers are more even more discerning. It is easier to notice a video artifact or dropped frames than a slight imperfection in an audio track.
Bandwidth to the desktop is another deal-breaker here too. Have you streamed a video lately? It is still a long way in even being DVD-quality. Broadband consumer adoption and performance are going to need a major boost for an Apple video service to make sense.
Third, competition is a factor, someone could beat them to it. All of the major studios are watching Apple’s progress with the iTunes Music Store (a.k.a. IMS) very closely and they also read the online Mac press. Should the IMS take off you can expect a competitor to try to eat Apple’s video lunch. One major advantage is MPEG-4 and QuickTime, if a competitor wants to use it – all roads go through Cupertino.
Licensing and industry stone walling are also huge factors that cannot be ignored. The IMS is doing so well because Apple spent a lot of time relationship-building with the artists and their labels. Steve Jobs had to give personal demos to bands like the Eagles to get them to sell their music on the IMS, what would it take to get Warner Brothers to allow him to sell the Matrix Movie sequels online?
Apple is well positioned to deliver a VOD service within 12-24 months despite Phil Schiller’s soft-stepping of the issue in his recent Business Week interview.
BW: Any plans for video down the road?
Schiller: No, right now we just want to make the world’s best music store. But I want to point out that iTunes includes particular music videos in the store. You can view some amazing music videos for free.
The operative words there are right now.
So could Apple be using the iTunes Music Store as a beta test for an iVideo Store? The answer my friend, is yes. What else can we deduce from Apple’s moves with the IMS? Can we expect them to deliver an iPhoto Store? iDVD store? iMovie store? The answers will be based on a complex series of business risk assessments and cost/benefit analyses. But for now, lets just keep buying music from the iTunes Music store.