Two More Movie Studios on iTunes?

The delay allows retailers time to do planning and inventory control before downloads become a significant market fraction.

Rocketman

So I recently finished watching the special free download from ABC of one of their hit shows during their "Million Hit Lowdown" promotion. At the end was an ad to buy that show on DVD.

Interesting idea. An ad for the DVD release at the end of the iTunes version. I can see that as something they do on movies as well.

"Buy the DVD, and get all these special features!!"

Or in the DVD package, a code that gives you a $5.00 discount on the iTunes version.

"Want to watch this on your iPod or {iTV}? Download it from iTunes. Type in this code for a special price!"

This second option would make a lot of sense for the new HD formats (HD-DVD and BluRay,) since they are (supposedly) more secure against ripping. Although for the average user, ripping a DVD is essentially impossible as well. (Not "impossible", but "essentially impossible". I've seen enough average users that can't even import their CDs onto their computer; or didn't know they could, that ripping a DVD with less-than-legal software is in the realm of impossibility for them.)

well the more studios the better. sounds like good news to me

I think that it's strange that studios think that online sales are going to cannibalize DVD sales.

1) Most likely, the people that are going to buy a movie from iTunes wouldn't have bought the DVD anyway

2) Distribution costs are virtually nothing.... so the profit margin should be a lot higher for a downloaded movie.

I haven't studied the economics of DVD manufacturing and distribution, but I would imagine that accounts for a large portion of the total DVD price.

parenthesis said:

I think that it's strange that studios think that online sales are going to cannibalize DVD sales.

1) Most likely, the people that are going to buy a movie from iTunes wouldn't have bought the DVD anyway

2) Distribution costs are virtually nothing.... so the profit margin should be a lot higher for a downloaded movie.

I haven't studied the economics of DVD manufacturing and distribution, but I would imagine that accounts for a large portion of the total DVD price.

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I don't think the studios are the reluctant ones, but the retailers. (see Wal-Mart - Target stories)

i think they'll all join in sooner than later. they're a company, they have a product and so they'll want to distribute it in as many places as possible.

I don't buy the fear from target and wal-mart. the ppl who will to buy x dvd will buy it anyways b/c of the special features etc.. some fringe folks may dload, but they may buy the dvd too.

but who cares!

We can't dload squat for movies in Canada (yet)

colocolo said:

I don't think the studios are the reluctant ones, but the retailers. (see Wal-Mart - Target stories)

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That, too. I'm still inclined to believe that the iTMS dealings with the record studios -- and the very public squabble between Jobs and a few execs last year -- have come around to bite Apple in the bum. I think the movie execs are afraid of Apple/iTunes and being set into a pricing scheme that they don't feel is fair or flexible (long-term). Bullies tend to clash with other bullies.

That's not to say, of course, that they won't sign on, I'm just thinking they're waiting for competition to ramp up. Remember that UnBox has a cat's meow of the studios on board.

Hope that its WB and its Fox

twoodcc said:

well the more studios the better. sounds like good news to me

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great news if you live in the U.S of A, the rest of the world seems to get forgotten about though, aperantly Apple, doesn't know people outside of the U.S. watch T.V. and movies and such I guess

If iTunes can become the #5 retailer of audio music (proposed for 1st quarter 2007), then why don't the movie distributors see this as a potential avenue for success?

Keebler said:

We can't dload squat for movies in Canada (yet)

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That's not true you can get Pixar short movies.

slidingjon said:

If iTunes can become the #5 retailer of audio music (proposed for 1st quarter 2007), then why don't the movie distributors see this as a potential avenue for success?

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I thought they were already #5 and are expecting to be #4 by next year, when they surpass Amazon (Wal-Mart, Target, Best Buy are the other 3 top music retailers). And you wonder why those companies are opposing Apple's rise in every way they can...

B

Based on the success of movie downloads so far, it is only a matter of time for the rest to join in. But I guess I'm just stating the obvious.

Screw Wal*Mart and Target. Call their bluff.

macfan881 said:

Hope that its WB and its Fox

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I'm thinking the samething. I know Fox atleast.

parenthesis said:

I haven't studied the economics of DVD manufacturing and distribution, but I would imagine that accounts for a large portion of the total DVD price.

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The cost of manufacturing and distributing DVDs isn't much compared to the cost of creating the content on the DVDs.


Lethal

Cowinacape said:

great news if you live in the U.S of A, the rest of the world seems to get forgotten about though, aperantly Apple, doesn't know people outside of the U.S. watch T.V. and movies and such I guess

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I'm hoping you're joking, because I can't imagine Apple sitting in their offices saying, "Gee, let's pass up millions of dollars on international buyers." Considering that they just got one whole studio set up in the US, it doesn't surprise me the international market hasn't materialized. The US version has barely started. I think we have to stop and think about just how much legal work is being done in the background. Now imagine Apple trying to replicate those efforts around the world. It takes time.

LethalWolfe said:

The cost of manufacturing and distributing DVDs isn't much compared to the cost of creating the content on the DVDs.


Lethal

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It's one of those things where a single unit doesn't cost much to produce, but that first one cost millions of dollars.

LethalWolfe said:

The cost of manufacturing and distributing DVDs isn't much compared to the cost of creating the content on the DVDs.


Lethal

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No, but with the cost of the designers, printing, materials, packaging, shipping, storage, and all the employees along the way, the cost is at least a few bucks per DVD.

Lixivial said:

That, too. I'm still inclined to believe that the iTMS dealings with the record studios -- and the very public squabble between Jobs and a few execs last year -- have come around to bite Apple in the bum. I think the movie execs are afraid of Apple/iTunes and being set into a pricing scheme that they don't feel is fair or flexible (long-term). Bullies tend to clash with other bullies.

That's not to say, of course, that they won't sign on, I'm just thinking they're waiting for competition to ramp up. Remember that UnBox has a cat's meow of the studios on board.

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I know for a fact that you are correct. The movie studios havent shied away from licensing content to some other online video services. But Record companies have had a very difficult time being able to price their product as they see fit. it is their content, and unlike being able to set different list prices for albums or individual singles like they can for retail stores, Apple has been very restrictive in what they will allow. This has hurt record companies ability to lower price for old catalog albums and charge more for a single hit song if people dont want to buy a full album.

Now Movie studios are in the same boat when Apple comes to them for deals. How do they like their number #1 retailers for dvd's like Walmart, Bestbuy and target complaining that movies are cheaper online than for them?

Personally I believe forcing people to BUY movies for itunes is wrong. We should also have ability to rent a movie. store it for a month, on mac/pc or video ipod, and watch it for a 24 hour window.

mahonmeister said:

Based on the success of movie downloads so far, it is only a matter of time for the rest to join in. But I guess I'm just stating the obvious.

Screw Wal*Mart and Target. Call their bluff.

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Retailers DO add value. Besides the real benefit of non-online folks having access to the media, there are significant advantages to browsing, and to impulse buying.

This benefits consumers, dealers, and studios.

I for one hope the DVD's offer value adds the download does not offer. A mini-poster for example. One significant aspect of CD and DVD and vinyl record artifacts is COLLECTING. Something that is lost on downloaded items to a degree.

All the studios have to, to maintain a good pass-through of artifact sales, is offer some additional artifact aspect that simply cannot be downloaded.

Rocketman

I don't think I'm alone in this, but I really don't see DVD sales taking a monster hit from the iTunes store. Let's face it... even IF there's a widescreen video iPod in the pipeline, and it gets rushed out in November, the studios are still going to make their bucks of the iTunes sales, and the percentage of customers they lose to online sales is really going to be fairly negligable for this holiday season.

My guess is that even if the fabled video iPod comes along soon, and it's a BOOMING success, somewhere around 75-80% of customers will still prefer to have their movies on DVD for now than on their iPod. Especially since a large portion of video iPod users will probably be more inclined to rip their own DVDs (like me) than buy from iTunes. It just doesn't make sense to rail against a company like Apple who always seems to be one step ahead of the curve. Why not jump on board and ride their coat tails. Everyone stands to benefit.

sisyphus said:

That's not true you can get Pixar short movies.

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how? please do tell!

mahonmeister said:

Based on the success of movie downloads so far, it is only a matter of time for the rest to join in. But I guess I'm just stating the obvious.

Screw Wal*Mart and Target. Call their bluff.

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I agree... They will keep selling their DVD's as usual. If one of them stopped doing it, do you really think the other would too? This would only increase the sales of the one left. They are just bluffing for sure.

clintob said:

I don't think I'm alone in this, but I really don't see DVD sales taking a monster hit from the iTunes store. Let's face it... even IF there's a widescreen video iPod in the pipeline, and it gets rushed out in November, the studios are still going to make their bucks of the iTunes sales, and the percentage of customers they lose to online sales is really going to be fairly negligable for this holiday season.

My guess is that even if the fabled video iPod comes along soon, and it's a BOOMING success, somewhere around 75-80% of customers will still prefer to have their movies on DVD for now than on their iPod. Especially since a large portion of video iPod users will probably be more inclined to rip their own DVDs (like me) than buy from iTunes. It just doesn't make sense to rail against a company like Apple who always seems to be one step ahead of the curve. Why not jump on board and ride their coat tails. Everyone stands to benefit.

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I agree with you for now... Once the quality is DVD quality, iTV is out, and HD space keeps getting bigger and bigger, THEN they may see an impact. But, most people just like to buy something tangible. Me, I buy more on convenience. It will be interesting to see how this all unfolds.