Apple’s iTV Doesn’t Add Up

With Apple’s recent iTV pre-announcement it’s clear that they’re looking to reproduce the success they’ve had with the iPod, and do for video what they did for music. However, what I had hoped would usher in true on-demand television is starting to look like nothing more than a jukebox for movies.

Ok, first things first. Clearly there is a market for movie downloads, and I’m sure Apple will make a profit doing so. However, what originally got me excited about iTV was the idea of ditching my cable company entirely and replacing it a vast library of television and movie content, available on-demand, over the internet. And while that idea still excites me, I don’t think Apple will be delivering on it. At least not out of the gate.

One Plus One Still Equals Two.

In theory the economics could work, but in reality they don’t. With the average monthly cost of cable at $41.17, and the average monthly consumption at 82.6 hours, it becomes clear that the numbers won’t add up. Assuming each show is 45 minutes long (1 hour minus the commercials), the average person would watch 110 downloaded episodes a month (82.6 hours * 60 minutes / 45 minutes = 110 downloads). At $1.99 a pop (and if my math is correct), that’s just shy of $220 a month. And when you bake 30 minute shows into the equation, the monthly costs will skew even higher.

Now, I suppose you can argue that without commercials, you’re actually watching more TV in that 82.6 hours a month, but not $180 more. Additionally, options like Multi-Pass do make the monthly expenditure a bit more palatable, but I’m not sure it’s enough.

If you’re a casual television viewer (such as myself), the number may add up… but unless you acquire content through illicit sources (aka BitTorrent), I can’t see Joe Average moving over anytime soon. I honestly hope more shows adopt the Multi-Pass model and offer multiple downloads for a discount. Because with the current pricing model, I don’t see how iTV will be a viable alternative for your current cable offerings.

You’ll be able to skip the trip to Wal-Mart for your next Pixar movie, but don’t expect to ditch the dish any time soon.