iTunes-like video services have no future: study | Technology | Reuters:
Online video sites that sell shows and movies such as Apple Inc.’s (AAPL.O: Quote, Profile, Research iTunes will likely peak this year as more programming is made available on free outlets supported by advertising, according to a study released on Monday.
Sales of movies and television shows are expected to almost triple to $279 million in 2007 from an estimated $98 million last year. But unless the average consumer begins paying for their online video en masse, growth in sales will likely peter out next year, according to Forrester Research.
“In the video space, iTunes is just a temporary flash while consumers wait for better ways to get video. They’re already coming,” said Forrester Research analyst James McQuivey, the author of the study, who also called the paid download video market a “dead end.”
I’m not sure on this one. I think iTunes will have it’s place for TV shows, much like a cable or satellite service, but in the end, people do expect to watch Television for free. Sales of TV shows on DVD are usually by people who want to collect a particular show after they have watched it. Until the quality of online video matches that of DVD then selling TV shows online will primarily be to those who want to watch it first run, and eventually, free services will catch up.
The onus is on producers and broadcasters to embrace the internet rather than compete with it, and not to let this end up being a cacophony of competing formats, none of which work particularly well across platforms.
In a way, Itunes has a good model with podcasting, if you were to deliver shows with advertising, but then bit-torrent is the ideal distribution for TV because of the way it works.
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