One of the number one problems with Apple TV, Netflix or similar services has always been that they have to wrangle content owners to give them the rights to play their stuff.

Pay-to-view subscription content owners have always been quite good on this part (i.e. HBO) but the bigger, more mainstream content owners have had difficulty wrapping their heads around the notion that they could make money from digital.

We all remember hearing the stories about Steve Jobs hustling music industry moguls to give him the right to sell their music at drastically cut prices, and even to sell songs individually in albums. At the time he could hustle these guys because they were on their knees. They thought they beat the Internet when Napster crumbled under the weight of Metallica-sponsored court orders, but in the wake of this came more services and even more advanced technology (namely torrents). I’m not going to discredit the feat that was getting iTunes up and running with major labels, but it was the best time to ask if you could sell music online cheaply. You’d be laughed out of a room for asking to sell individual tracks for 99c at the height of the music labels’ power.

Cut to today and the shape of the music industry is very different. iTunes thrives where HMV can’t compete and the age of paying to stream unlimited music is here with Spotify and similar. Sure, piracy is still there, but it’s almost expected now. The labels are making money (though they won’t tell you that) and smaller indie artists are getting a fair chance and share of the profits. Even some small sample of big artists have ditched big label business and gone indie. There’s bigger profit share for artists if they run their own show, and they get to control their own destiny. You don’t need huge distribution networks and HMV to make money and have fans that’ll buy tickets to your shows…

With that landscape in mind, it’s unrealistic to expect iTunes to become a label. It’s just a very liberal store that artists can sell through. Apple won’t spend money to get artists equipment to make albums to sell through iTunes, nor would Spotify.

Switch to the TV and movie industry and things are different. If you were to do the music stuff differently now, what would you do? As a content publisher or storefront, you would want to own the content itself. Or at least cut out the other guys.

The setup is different in TV & film because the industry has people hired on contract basis. No one working on a show actually works for the network permanently in general. The networks just give money to a team who make a show and then the network shows it, selling advertisement space during the show. The model HBO & similar takes is to pay production teams to make shows with bigger budgets and charge people to view the show as well as having advertisements (that don’t interrupt the show itself usually). The only thing these networks had in the past was an audience, but arguably that audience is migrating away from TVs to computers already.

Netflix is kind of like Blockbuster where someone made a film, and now they can go rent that out to customers. There’s a fee paid to the studio and a license paid… then after that everything is profit. However, the cost of this remains unfairly high for Netflix. What if Netflix cut out the licensing and fees and just used that money to fund production outfits to make shows?

This is happening with the return of Arrested Development, arguably one of the funniest TV shows in the last 10 years. With the advent of an Arrested Development film, the producers decided it was a good idea to re-introduce the characters with a pre-emptive series. This will be aired exclusively on Netflix – funded by Netflix. Suddenly the provider owns the content and TV networks will have to “rent” the series from Netflix.

It’s not that hard to see Apple swing it at this point to “save” networks the same way they “saved” reluctant music labels with cheap rentals for consumers. Sure it’s less initial money, but more people will buy into the idea. In the same way that buying a single track from an album seems unusual to labels, buying/renting one episode from a TV series shouldn’t be too hard.

I know there’s more to it than that, but we’re starting to see a shift towards digital… and the content owners are still reluctant to jump into the pool with the digital distributors. But it’s when piracy starts to properly kick in that people like Apple and others can step in and offer an olive branch like iTunes. I’d definitely pay €10 for a subscription to a TV series, or €1 for an episode.