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Hollywood Against Jobs' Movie Pricing Plan
Alex Romanelli, Variety writes "Hollywood insiders tell Variety why/how Hollywood is in stalemate with Jobs over movie downloads on iTunes. Jobs wants a flat $9.99 per film download, studios are refusing, insisting upon tiered pricing. On the other side there's a
different, longer, analytical story looking at how H'wood executives are still unsure if Jobs should be considered a friend or foe."
I can hit Best Buy and get stuff for $7.00 now.
Of course, it occurs to me that the MPAA is whining because they want to charge MORE than that. Oy vey. The problem with ITunes is that there's no damn tail...A dollar (or ten) is too much for 80% of the stuff that could be sold.
ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
Tiered pricing makes sense as a way of dealing with demand and maximizing profit. New singles should cost more, especially if they are popular, for a short time. The problem is that the labels don't want to price things in the back catalog down, which is where this argument is really useful. They only want to go up from the base 99/$9.99 model that Apple has established.
There are songs in catalog that actually have a value approaching zero. You try telling a record exec that fact, and they will spin on one heel and exit the room before you finish your sentence.
I'd like to see a system whereby the price is directly tied to short-term popularity as measured by downloads. So your new Christina Aguilera single comes out at a base price of 99; it shortly becomes very popular and creeps up over the course of a few days to $1.99 (there should be a ceiling, obviously). If you really want that "hot new track" (gag) right now, you pay the premium (or go elsewhere; different story there). Conversely if you really want to buy old Fleetwood Mac tracks from Rumors, which has paid for itself several times over already, you should only need to pony up 19-29 per track to cover bandwidth and processing.
If labels wanted to really invest in the long tail argument they would probably find themselves with a lot of new cash and not only that, from basically no promotion! But they are too stuck in the old sticks and bricks mindset, which is to promote a lucky few lottery-winner bands and maximize profit from those acts, at the expense of literally everything else.
(eMusic gets it, by the way.)
If Jesus wants me it knows where to find me.
It was my understanding that, since the Disney/Pixar deal, Jobs is the largest single shareholder in the Disney corporation. If his influence extends to the other Disney brands such as Miramax, ABC, Buena Vista, Caravan, and Touchstone, I would say he commands a lot of power.
Regardless, we should all be keeping an eye on Jobs. It's only a matter of time before he consolidates his power base into the single largest converged media empire on the planet.
JMHO
Matt
A lot of comments have been directed towards video quality and codec, but what about the audio? At least when I buy a DVD of anything filmed recently, I know I'm going to get a DD5.1 track, and hopefully also a DTS track of even higher quality (usually a much higher bitrate). Think about this: I want to download a two hour movie. Take 120 minutes * 60s/min * 1.5Mbit/sec (DTS) * 1 MByte / 8MBits, and you have about 1.35 gigabytes just for the audio track alone. Somehow, I don't see Apple giving me that. I'm much more worried that they will expect me to watch Lord of the Rings with a 128kbit 2-channel audio track, and there's no way in hell I'm doing that.
$5.00, $5.50, and $7.50 for many fairly recent movies?
Why would I want a DRM encumbered version when I can get a hardcopy that I can easily make a backup copy to use when I travel. The last time I traveled, I had two disks destroyed. Both fortunately being backup copies.
I think Gates is a bit out of touch with fair pricing on movies. Pricing for movies is non-linear and has a wierd logic.
*Roughly*
1) If it is mega popular, it will be cheap the first few weeks only- then go up to about 17.99 to 19.99 and then drop to $14.99 on major holiday.
2) If it is reasonably popular, it will be cheap the first few weeks, then go up to a lower price (maybe 14.99) than the mega-popular movies. After six months it will drop to $10 at least once a month and $7.50 on major holidays.
3) If it is not that popular but a solid niche film- it's going to behave like #2.
4) If it is not that popular and not a niche film- it's going to drop to $9.99 and go on sale for $5.00 (or "two for $10.00").
5) Then there are some funky movies which have wierd prices for years before they suddenly collapse (Time Bandits was $25 to $34 forever. So I just didn't buy it. Finally it broke on a holiday down to $7.50 and I picked it up).
$9.99 is unreasonably low for a few movies and unreasonably high for most movies and it completely ignores the time value of movies.
The underlying problem with all entertainment is a growing glut and the fact that people only have about 21 hours a week to consume entertainment in. At 21 hours a week, I have about 500 *weeks* of entertainment to choose from right now plus 10 hours a week of new stuff piling in via cable (Mostly "Whose line is it Anyway" right now-- losing sleep so I can cram it in). And I havn't even bought the Superboy seasons on sale at fry's for $22 per *season* ($1 per hour) yet- which would be 3 more weeks of entertainment.
Then you have to subtract out time you spend on concerts, hanging out with friends playing board games, online computer games and if you think about it much at all, you begin to wonder why the price on this crap is so high.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
I would be willing to pay $10 for my movies if I have two of the following rights! I can burn them to a DVD to play on my DVD player. Also I would want the FULL catalogue available, so I can get a copy of some MGM classic for $10 or get the latest and greatest blockbuster for $10. Either way once I download it, I own that copy.
-Ghost