iTunes UK TV Video Price Analysis

Yesterday iTunes in the UK finally got TV shows available for purchase. Individual episodes cost £1.89 which with the exchange rate as it is at the moment makes it twice as expensive as in the US. However based on how much the episodes cost against DVD box sets they are very competitive.

Series such as Lost, Ugly Betty, Greys Anatomy and Desperate Housewives all cost £32.99 in iTunes, the respective DVD's online cost:

Correct as of 8:30am 30/08/07.

As you can see there is a difference within the UK DVD market however in general by shopping around you can get the earlier series such as Desperate Housewives series 1 at a considerable cheaper price than on iTunes however newer series such as Lost Series 3 are considerably cheaper through iTunes.

In the music store Apple set a universal price of 79p for individual tracks (99p for iTunes Plus), albums are slightly different but usually hover around the £7.99 mark which is very competitive and often cheaper than physical CD's. In the table above we have demonstrated that Apple don't have that competitive edge of being universally cheaper in the video market unless they were to lower the price of older series.

That said Apple have opened up a market not previously available in the UK - being able to buy individual episodes. This will benefit shows such as South Park that have no continuous story line however a show such as Lost needs all episodes to be watched in the correct order. Therefore people may use iTunes as a catch up service for shows they have missed or buy the newer series with the cost saving.

What I think will be key to the success of the video store will be how quickly videos get added after being aired. For UK shows this will be relatively simple however with US shows this could be harder as often the show is aired in the states months before it airs over here. It is unlikely that Apple will be allowed to add the show to iTunes before it airs on UK TV though it could be a very lucrative market especially if Apple managed to bid for a TV show before any UK network takes interest in it.

Apple have been getting a lot of bad press over the past 24 hours about the price of the TV shows in iTunes but if you look at them against the DVD market it doesn't seem so bad. It could be argued that the DVD market in the UK is too expensive anyway but that is hardly Apple's fault for basing their product at a competitive price point. In some ways this could help force down the cost of new DVD sets. These normally have an RRP of around £65 however it is very rare to see a DVD box set on sale for that amount (let alone anyone actually buying it).

In comparison to the download market in the UK iTunes is slightly more expensive than the competition. Channel five offers CSI episodes for£1.49 each (or £29.99 for the series) and Greys Anatomy episodes for 99p each. Channel 4 currently only allows the renting of videos for 99p each (after an initial free 7 day catch up).

Hopefully with the launch of the iTunes UK video store it will encourage studios to start putting more content online at a competitive price but I'm pretty sure the £1.89 price will set a benchmark just as 79p did for music.