December 6, 2005
iTunes and Video-On-Demand

Apple announced this morning that they are adding 11 new television shows from NBC Universal to the iTunes Music Store. The new offerings include shows from the current season on NBC, the Sci-Fi Channel, and the USA Network. Past seasons of current shows and older NBC television series like Alfred Hitchcock Presents and Dragnet were also made available.

The iTunes music store has move than 3,000 videos available for download (including music videos, Pixar shorts, and television shows). Steve Jobs, the CEO of Apple, asserts in the press release that Apple has sold more than three million videos in the first two months of the service alone.

Over on Brand Noise, an entry today - ostensibly spurred by the Apple announcement - discusses the future of Video-On-Demand (VOD). Two points are clear:

  • Advertising will play a role in determining VOD cost
  • Programming shouldn't be limited to the VOD itself but include extra content for new and dedicated downloaders. Extra content will also provide opportunities for imaginative advertisers to reach a "finely-tuned" audience.

    Right now, the iTunes music store is the highest-profile provider of online VOD content and has so far resisted including advertising. When Apple does begin to include advertising (and I think it's a matter of "when," not "if"), it will be interesting to see how it is implemented - before the content in the style of movie previews, or during the content in the style of television? Who will benefit: the producer of the content, or Apple itself? And most importantly, how much advertising will viewers tolerate before they move on to the next product that allows them to skip advertising?