Why does it cost $12 per tape to digitize it? I recently digitized a giant pile of old home movies, and all it took was an $80 usb video capture device, $20 thrift store VCR, and a few minutes each. About every dozen tapes I had to take the cover off and clean the heads, but that was no big deal.
Some older tapes will need a time base corrector to rebuild the sync signals, but they aren't that expensive.
If I remember correctly, the IA also likes to encode the video several times in different qualities and formats and that results in large archives. A 1 hour TV show might end up taking 100 gigs of space. With RAID and replication, an enterprise 4tb drive that costs $200 might end only holding 2tb of data, or 20 TV shows. That ends up being $10 in equipment just by itself for storage. Then add on the costs of power and equipment to encode it and the labor, I can see things costing $13 per tape.
Some older tapes will need a time base corrector to rebuild the sync signals, but they aren't that expensive.