WSJ: ABC, Fox to rent 99-cent TV shows on iTunes

For months we've heard Apple was pitching Hollywood studios to adopt a 99-cent rental fee for TV shows. According to the Journal, Disney and Fox have signed on.

On the eve of Apple's annual fall media event, The Wall Street Journal reported that two major Hollywood studios will rent TV shows on iTunes for 99 cents.

According to the Journal, Apple will announce Wednesday at its media event that Disney and Fox will embrace--at least for a while--a price structure that Apple wants all the other studios to adopt.

Right now, TV shows are not available for rent at iTunes. The Web retailer offers numerous episodes free of charge and others, such as the hit AMC drama "Mad Men," the price to buy a single episode is $2.99.

The Journal's story comes on the heels of a well-researched report published Tuesday by The Los Angeles Times about Apple's efforts to get the studios to buy into the 99-cent fee.

The Times wrote: "Some executives of News Corp., which owns the Fox network, worry that offering 99-cent episode rentals will cut into lucrative DVD sales and pull viewers away from watching network TV, thereby eroding a $20 billion advertising market."

While it appears, Fox management believed the risks were worth taking. However, the Journal reported that Fox's deal with Apple may just be a tryout. Its sources told the paper: "Fox agreed to participate in 99-cent rentals for a short period of time, and agreed to the lower-cost price only for broadcast shows it both produces and airs."

What may be more telling is that Apple could only sign two of the six top studios, Fox and Disney, whose largest single shareholder is Apple CEO Steve Jobs.

According to the Times story, the studios that didn't participate fear offering TV shows for such a low price will devalue their material--even more than it has become at a time when all media becomes more of a commodity.

 

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