Rumor: Apple Looking Into Creating $30/Month iTunes TV Subscription Service

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Date: Tuesday, November 3rd, 2009, 05:10
Category: iTunes, Rumor

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If you want additional television content over iTunes, you might not have that much longer to wait.

Per MediaMemo, Apple has reportedly reached out to TV networks in recent weeks with a proposed US$30/month subscription plan to deliver content via iTunes — a service it hopes to launch in early 2010.

Citing multiple sources, the article stated that Apple’s subscription proposal is not based on any specific piece of hardware, like the Apple TV or forthcoming tablet. Rather, the plan would stick with the existing iTunes desktop software.

“Apple has told industry executives it wants to launch the service early next year,” the report said, “but I have yet to hear of a single programmer that has made a firm commitment to the company, which has tasked iTunes boss Eddy Cue with promoting the idea.”

If anyone does bite, the first expected is Disney, of which Apple co-founder Steve Jobs is the largest shareholder. Disney was the first to allow its content on iTunes and saw tremendous early success.

Kafka said that industry executives are “intrigued” by the prospect of a subscription plan on iTunes, as they are looking for new revenue streams as advertising returns diminish. However, cable networks are concerned about sacrificing existing relationships with providers like Comcast, and all content providers are worried that advertising revenue could decrease if live viewership shrinks.

“So Apple’s proposed subscription service, which the company has floated in the past, is no longer a huge stretch,” the report said. “Says one executive briefed on the company‚Äôs plans: ‘I think they might get it right this time.’”

Apple has been long rumored to provide a subscription option for TV content. In August, Gene Munster, Piper Jaffray senior research analyst, said he believes that Apple would release a new Apple TV in conjunction with a subscription TV account. But the agreements necessary to offer a subscription service would take some time.

“Apple could leverage its deep library of content with many network and cable channel content owners to provide unlimited access to a sub-library of its TV shows for a standard monthly fee ($30 or $40 per month),” Munster writes. “Such a product would effectively replace a consumer’s monthly cable bill (~$85/month) and offer access to current and older episodes of select shows on select channels.”

Last week, the Apple TV software was updated to version 3.0. Improvements included a newly redesigned interface, support for iTunes Extras and iTunes LP, and streaming Internet radio.

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