Apple TV’s Rental Model Divides Studios

Similar to the debate among studios over the effectiveness of a 28-day home entertainment window, major television producers are taking sides over the 99-cent streaming rentals of shows now being offered by Apple TV. Fox and ABC are supporting the launch of the new service. But executives at three rival studios have flatly criticized Apple TV’s new business model in recent days. “The 99-cent rental is not a good price point....It doesn’t work for us,” Philippe Dauman of MTV and Nickelodeon owner Viacom said at a Goldman Sachs investor conference in New York on Thursday (via Dow Jones Newswires). NBC Universal’s Jeff Zucker expressed similar sentiments at the same conference on Wednesday (via Reuters). “We do not think 99 cents is the right price point for our content,” Zucker said, adding that after being pitched on the rental model, “we thought it would devalue our content.” UPDATE: Zucker announced today he would departing as head of NBC Universal when the company's deal with Comcast receives final approval (more at USA Today). Last week, Warner Bros. chairman Barry Meyer told a Los Angeles conference audience that his company would rather license entire seasons of TV shows than “open up a rental business in television at a low price” (via the LA Times).