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Advertisments on iTunes to Discount Prices?
In fact, the iTunes service is funded through retail sales revenue and not at present as a result of advertising. But, said Mr. Cue, Global Vice-President of iTunes, iTunes may well carry advertising in the future -- hence their interest in these Applications.
One system described is in-line advertising as described by "the placement of third party advertising at the start, end or during actual delivery of a Repertoire Work to a customer by way of a permanent download". Additional quotes suggest the ads would be delivered on content whose price has "been artificially depressed to reflect such revenue." (ie. discounted)
The discussion appears to be hypothetical and the original report "stresses" that these discussions were on the "potential of ad-funded downloads" rather than any specific plan. .
There had been rumors that Apple was exploring advertising options for iTunes with older claims that Apple was looking at a way to incorporate ads into Podcasts.