Last month Kenneth Li at Financial Times was the first to write about Apple pressuring the networks to sell TV shows for $.99 on iTunes. He was first again at suggesting some of the networks had agreed to a test. Last week during an analyst's call, CBS chief Les Moonves disclosed CBS would be involved with the testing on "some shows."
The New York Times' Brian Stelter has a good write-up on the topic in Monday's New York Times.
Apple's theory seems to be that if you price the shows at $.99, many more people will start to download shows. I agree with that to a degree, but only a small degree. Even over a very fast broadband connection, a download of even a standard definition episode on iTunes can take a while, and the more expensive HD versions take even longer. Songs take a few minutes to download and people play songs over and over again. It's not the same with TV shows.
Still, I'd agree that some of the current iTunes pricing is ridiculous. $1.99 for a single episode from Lost's season one? $2.99 for HD? A season pass for $34.99 in standard definition and $49.99 in HD? The first season DVD is available for $16.99. The Blu-ray disc is actually hardly any cheaper than downloading the HD versions from iTunes -- $48.99 on Amazon (down from an original list price of $69.99).
ABC should probably be OK with selling past season episodes of Lost for $.99 an episode on iTunes, at least in standard definition. But the current season? No way. Lost still sells a ton of DVDs in its first few weeks of release, over 700,000 Lost season 5 DVDs at an average price around $40 last December. The networks and studios aren't going to be interested in undercutting DVD pricing months ahead of the actual DVD releases.
Apple might get the $.99 per episode pricing it is seeking, particularly with episodes from past seasons. My guess is you won't see that sort of pricing for new episodes of popular shows anytime soon.