Wall Street Wonderland

The good, the bad and the unspeakably ugly and everything in between, so help us!

Wednesday, May 14, 2008

Apple's HBO deal means shift in iTunes pricing; Whatever the market will pay

Tough-guy Tony Soprano and the frisky femmes from "Sex and the City" are now available for viewing for non-HBO subscribers through download purchases on Apple's online iTunes store, the companies announced Tuesday.

The agreement, which includes different prices for TV shows, marks a shift for the Cupertino company, which has resisted pressure from the entertainment industry to change its pricing model.

HBO episodes from "Sex and the City," "The Wire" and "Flight of the Conchords" will cost $1.99 per episode, the iTunes standard price for individual TV shows. But other shows - "The Sopranos," "Deadwood" and "Rome" - will command premium prices of $2.99 per episode.

The pricing shift represents the reality that not all content is equal, said Rob Enderle, founder and principal analyst at the Enderle Group, a technology consulting firm.

"I think this is the way it will go," he said. Such a system could eventually pave the way for consumers to download movies while they are still in theaters. "Maybe a first-time movie will sell for $30. It's not going to sell for $2," Enderle said.

Apple CEO Jobs has resisted such price variations for fear of driving costs too high. "He thinks the content people are clueless, and he wants to make sure they don't destroy the market. But there has to be a balance," Enderle said.

Music downloads, though, most likely won't see price variations. "They are competing with subscriptions. They can't allow music to go up," he said.

HBO and Apple hope to benefit from the buzz around the "Sex and the City" movie, which opens in theaters May 30. All 94 episodes from the show's six seasons will be available through iTunes.

http://www.mercurynews.com/businessheadlines/ci_9253750

0 Comments:

Post a Comment

<< Home