Hi All, Sam Shrauger PayPal’s VP of Global Product Strategy, here.

Last week we saw big digital content news from Apple, Amazon and Samsung further indicating that old payment models need to change to meet the increasing consumer desire to have digital content, TV shows and applications on demand.

The new Apple TV will let you stream content right to your television at an inexpensive price, now only 99-cents for a TV show or movie. This pricing structure mirrors the original iTunes model, which caused a major shakeup in the music industry and shifted consumer behavior substantially. What will be the impact of this pricing model and the rise of over-the-top video on the business model of cable providers and the creators of video content? And, how will consumers react to this new approach and economic model for consuming content?

I believe consumers are ready for this new way of receiving and paying for content. I know I am. As with any service, I want to pay for what I consume – and not what I don’t.   The rise of pay-per-view, video on demand, and premium sports packages in recent years has demonstrated that consumers can and will embrace such a model.  But, what increasingly frustrates users in this day of on-demand, instant-access consumption is paying monthly subscription fees for hundreds of channels they never watch, so that they can access the few channels or programs that they do.

Hours after Apple, Amazon also announced that it would begin renting TV shows for 99-cents per episode, cut from $2.99. This united front of two major players in the tech world should increase pressure on cable and satellite TV operators to change their existing models.  But, Thursday’s programming deal between Time Warner and Disney to keep ABC, Disney and ESPN on in major cable markets like NY and LA suggests that old cable models may remain the norm for the time being.

Meanwhile, Samsung announced a new application platform that allows consumers to access Facebook, Twitter, Netflix and Blockbuster while flipping through their TV channels. Today people can buy virtual credit online to purchase apps, but in order to incent developers and content providers to create compelling applications, the payment model will need to adapt.

The one thing that iTunes showed the music industry is that people are willing to pay for digital content, if you make it easy.

It looks like the time has come for that same revolution to reach the movie and TV industries.  We’re sure that PayPal will play an important role in removing the friction and letting consumers enjoy their TV and movies, where and when they want. What do you think the future of TV watching will look like?

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