MacUser: Please, Apple, invite us to the subscription dance

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September 14, 2006

Please, Apple, invite us to the subscription dance

Authored by Dan Moren at 10:38 AM

Category | Music » iTMS

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Dancing! Tuesday’s Showtime event was good and even, at some points, wowing. But there still seemed to me to be some gaps in Apple’s video platform. Some, like the true video iPod, I’m guessing are simply not ready to be shown yet. But the biggest gap, for me, was not hardware or software but policy.

Several months ago, I speculated that Apple wouldn’t introduce a DVR-type device because doing so would cannibalize sales of TV shows from the iTunes Store. Why pay $1.99 per episode when you can DVR it for free? There’s also the not insubstantial ideological reasoning: DVR is a stopgap method, designed to bring time-shifting to a medium which does not by default allow that functionality. But video on demand trumps that by allowing you to pick what you want to watch and when you want to watch it. I believe, as I think Steve Jobs does, that the DVR is merely a stop on the road to video on demand. Thus, the logical conclusion would be a device that would let you watch the content you bought on the iTunes store on your TV—what we called at the time the AirPort Express with video and Apple has codenamed “iTV.”

So far, my logic seems to be on track (or, at least, meshes with Apple’s logic). Now we enter a slightly fuzzier—shall we say crepuscular—zone. Follow me if you dare.

A couple months after my diatribe on DVRs, I entertained another notion related to video: the failures of the model which Apple was using to distribute them. At the time, I said:

The way I see it, iTMS’s value for video is not in owning the content. If I do want to own it, I’d rather have it on DVD; it’s easier to store, it’s better quality, and, let’s face it, it’s tangible. The real value of iTMS is in time-shifting and near-instant gratification; it competes with broadcast, not DVD. With iTMS, I don’t have to wait to the end of a season if I missed last night’s episode of Lost because I can go watch it whenever I want.

The company Apple needs to compete against in the video market isn’t TiVo; it isn’t Google, or Microsoft, or even YouTube. The company they need to take on is Netflix. Find a way to appeal to the people who just want to watch video, not necessarily own it, and you’ll have yourself a big new market for online video.

And now, four months later, I stand by that sentiment. What’s missing from the iTunes store is a way for me to watch video without having to own it. I can see a few possibilities here.

1. Apple disagrees, utterly and totally. We will never see subscription content for video, just as we’ve never seen subscription content for music. I am full of crap.

2. Apple is working on a subscription model, but hasn’t rolled it out yet. As I see it, there are a few reasons why they might not want to roll it out yet. Firstly, they’re still a little short on content. With only 75 films available all from essentially one company, it’s going to be hard to sell a “Disney movie subscription.” We didn’t see Multi-Pass or Season Pass options of the TV content for several months, perhaps they’re following that trend.

Another possibility is that the subscription model is not technologically ready to go. In order to make this palatable to consumers, they need to make it so that the restrictions on watching movies are not draconian. Amazon’s Unbox restrictions ($3.99 rentals last 30 days and once you’ve started watching you have 24 hours to finish) were viewed by many as irritating; the same reason that the DIVX disc format ultimately failed. At the same time, they’ve got to make sure that whatever scheme they come up with is fairly secure, so that hackers don’t compromise it easily.

Which brings us to the third point. As well as making the scheme acceptable to consumers, Jobs and co. need to make it attractive to studios. As Apple seems to still be in negotiations with other studios to make their content available, Apple needs to stay away from anything that looks risky to content producers. Buying and owning content is pretty straightforward for them, but adding in a subscription model might make some studios balk. Far more likely is that Apple gets them onboard and then springs subscriptions down the line, once the studios have already committed.

But we are, as I noted above, still one puzzle piece short. The iTV has been dangled in front of us like a carrot, but the device won’t be shipping for months yet. A subscription service for things you can watch only on your computer and iPod wouldn’t be terribly attractive either, especially given the dearth of available content.

Now, of options 1 and 2, I think it would be silly to suggest that Apple is not even remotely considering the idea of a subscription/rental service. There’s a chance for substantial revenue here: movie rentals still do good business and companies like Netflix and Blockbuster have been running subscription services for some time now. It’s far more believable to me that Apple’s looking into this market, but has not yet decided how to proceed than that they’ve foregone it all together.

Perhaps my own desires are coloring this issue, but I had devoutly hoped for a subscription model to be introduced at the Showtime event, and I forgot all about it until yesterday. Such is the power of Steve Jobs’s reality distortion field. If it works true to form, I expect us all to be gushing about how wonderful subscriptions are, say, six months from now. You listening Steve? My $20/mo. is yours for the taking.

Comments

I am in sync with you and I wish.. wish.. wish.. Apple is on the same page too. I love the netflix model and believe that it would be a reflex for me to pony up whatever they asked for to get unlimited movie rentals. But I think the best part would be the ability to download the TV shows as well. If that happened for a flat monthly fee. You can kiss my productivity good bye. Please Apple..

Posted by: kwebster | September 14, 2006 08:04 PM

I think he will have to introduce a subscription model, I do not know many people who spend 15 or 20 dollars a movie right now on DVD. People rarely buy DVD's, only when its a movie they really liked and want to collect it. But they do rent movies like mad. You can't really apply the same music model here because you dont watch movies over and over hundreds of times, owning them is expensive and unnecessary.

I think the best bet for apple adopting a subscription model is a flat rate that gives you access to anything and everything (music, music videos, tv shows, and movies) as long as you are paying the monthly fee. Hell, they could even rope people into a contract like cell phone companies. The key is flat rate and access to everything for as long as you are paying. I'm sure this could be implimented with only a few minor tweaks to FairPlay. You do not really need to worry about piracy because you would have to be a subscriber in the first place before you could strip the DRM and free copies of many movies is already on Bittorrent. There really isn't a lot of incentive for people to break apple's DRM, save for some valid fair-use purposes.

I really hope they have this and just haven't introduced it yet, because i would pay the fee in a heart beat and ditch my cable and netflix subscription

Posted by: Brandon | September 15, 2006 02:00 AM

September 14, 2006

Please, Apple, invite us to the subscription dance

Authored by Dan Moren at 10:38 AM

Category | Music » iTMS

Digg it | del.icio.us

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