On the Viability of an iTunes Movie Download Service - Part II (iTunes to the TV)

1.0 Introduction - Will iTunes Introduce a Movie Download Service?

2.0 Understanding the Landscape

2.1 The Alternative On-Demand Video Universe

2.2 Viewing Movies on the PC - Give Me a Break!

2.3 To STB or Not to STB - That is the Question

3.0 Shifting Online Movie Distribution to the Living Room

3.1 Movielink

3.2 CinemaNow

3.3 MovieBeam

3.3.1 Overview

3.3.2 Brief History

3.3.3 The Money

3.3.4 The Model

3.3.5 The Future

3.3.6 Overcoming Past Stumbling Blocks?

4.0 Apple’s Entry into Movies-on-Demand

4.1 Rationale for Market Entry

4.2 The Living Room Takes Center Stage

4.3 The Evolution of iLife

5.0 Consumer Receptivity to a Set-Top-Based iTune’s Movie Service

5.1 Background & Methodology of June 2006 Consumer Study

5.2 Interest in iTunes Movie Service with an Apple-Branded Set-Top Box/Movie Player

5.2.1 $200 or Less

5.2.2 $200-$300

5.2.3 $300-$400

5.2.4 More than $400

5.2.5 Interest and Power Ranking Comparison

5.3 Profiling iTunes-to-TV Movie Service Intenders

5.3.1 CE Ownership

5.3.1.1 iPods

5.3.1.2 TVs

5.3.1.2.1 TVs Owned

5.3.1.2.2 TV Purchasing Behavior

5.3.1.3 DVD Players

5.3.1.4 Game Consoles

5.3.1.5 DVRs

5.3.1.6 Home Theaters

5.3.1.7 Desktop PCs

5.3.1.8 Laptop PCs

5.3.2 Use of PayTV Services

5.3.3 Use of Value-Added TV Services

5.3.4 DVD Ownership & Purchasing Behavior

5.3.5 DVD Rental Behavior

5.3.5.1 Frequency of Rentals

5.3.5.2 Rental Services Currently Used

5.3.6 Technology Adopter Status

6.0 Demographics of iTunes-to-the-TV Intenders

6.1 Age

6.2 Annual Household Income

6.3 Marital Status

6.4 Education

6.5 Home Ownership Status by Intender Segment

6.6 Number of Children

6.7 Hobbies

7.0 Reflections and Recommendations

Appendix A: 'Apple Profile' of Survey Sample

List of Figures

Figure 1 The Alternative Universe of On-Demand Video

Figure 2 Proclivity to Purchase an Apple Movie Player at Less than $200

Figure 3 Proclivity to Purchase an Apple Movie Player at $200 to $300

Figure 4 Proclivity to Purchase an Apple Movie Player at $300 to $400

Figure 5 Proclivity to Purchase an Apple Movie Player at More than $400

Figure 6 Comparison of Purchase Proclivities of Apple Movie Player Across Price Points

Figure 7 iPod Ownership by Intender Segment

Figure 8 Number of Televisions in the Household by Intender Segment

Figure 9 Number of SD Digital TVs in the Household by Intender Segment

Figure10 Number of HDTVs per Household by Intender Segment

Figure11 Number of Analog TVs in the Household by Intender Segment

Figure12 Date of Most Recent TV Purchase

Figure13 Intended Date of Next TV Purchase

Figure14 Intention to Purchase HDTV in the Next Six Months

Figure15 Number of Stand-Alone DVD Players in the Household by Intender Segment Figure16 Number of Game Consoles in the Household by Intender Segment

Figure17 Number of DVRs in the Household by Intender Segment

Figure 18 Home Theater Ownership by Intender Segment

Figure 19 Number of Desktop PCs in the Household by Intender Segment

Figure 20 Number of Laptop PCs by Intender Segment

Figure 21 Use of PayTV Services

Figure 22 Use of Digital Cable TV Services

Figure 23 Advanced Features/Services Used by Intender Segment

Figure 24 Number of DVDs in the Household by Intender Segment

Figure 25 Number of DVDs Purchased in Last Six Months by Intender Segment

Figure 26 Primary Reason for Purchasing Movies by Intender Segment

Figure 27 Number of Movies Rented Per Month by Intender Segment

Figure 28 Type(s) of Rental Services Used by Intender Segment

Figure 29 Technology Adopter Status by Intender Segment

Figure 30 Age of Respondent by Intender Segment

Figure 31 Annual Household Income by Intender Segment

Figure 32 Marital Status by Intender Segment

Figure 33 Educational Status by Intender Segment

Figure 34 Number of Children Living in the Home by Intender Segment

Figure 35 Hobbies of Respondent by Intender Segment (1)

Figure 36 Hobbies of Respondent by Intender Segment (2)

Figure 37 Evaluating TAM vs. Take-Rate for iTunes-to-TV Movie Download Service

Figure 38 Ownership of iPods Among Broadband Households

Figure 39 Personal Usage of iPods Among Broadband Heads-of-Household (HoH)

Figure 40 Type of iPod Used Among Broadband HoH

Figure 41 Number of People in Broadband Households that Use iTunes

Figure 42 Experience with Downloading Video from iTunes

List of Tables

Table 1 Average Number of Televisions by Intender Segment

Table 2 Average Number of of SD Digital TVs by Intender Segment

Table 3 Average Number of HDTVs by Intender Segment

Table 4 Average Number of Analog TVs by Intender Segment

Table 5 Average Number of DVD Players by Intender Segment

Table 6 Average Number of Game Consoles by Intender Segment

Table 7 Average Number of DVRs by Intender Segment

Table 8 Average Number of Desktop PCs by Intender Segment

Table 9 Average Number of Laptop PCs by Intender Segment

Table 10 Average Number of DVDs Purchased in Last Six Months by Intender Segment

Table 11 Average Number of Movies Rented Per Month by Intender Segment

Table 12 Average Age of Respondent by Intender Segment

Table 13 iPod Ownership and Interest in iTunes-to-TV Movie Service

Table 14 iTunes Video Usage and Interest in iTunes-to-TV Movie Service

Table 15 Number of iTunes Video Users by Household and Interest in iTunes-to-TV Movie Service