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Apple Movie Store Only Serving Disney Films?
Alex Romanelli, Variety writes "Variety has the scoop on Apple and Amazon's forthcoming movie download services. Apple's will launch with only Disney as a partner. Amazon will have most, and possibly all, of the major studios on board. The reason comes down to price, insiders said.
Amazon.com will launch its movie download service later this week, numerous sources confirmed, while Apple will start selling films on Tuesday as part of iTunes."
First of all, the Vareity article (which doesn't necessarily know anything for certain) says:
"The only studio that will definitely [emphasis added] be part of Apple's movie store at launch is Disney.
So that still doesn't preclude other studios being on board at the time of launch. Even so, it still goes on to say:
"Other studios will likely join iTunes in the next year."
Further:
"The reason Amazon will have content from most major studios, while Apple may have only one, comes down to price, insiders said. Because it also sells DVDs, Amazon has agreed to studio demands that digital wholesale prices not undercut those of DVDs. [emphasis added] As a result, Amazon.com's digital download prices are expected to range from $9.99 to $19.99 -- about the same as those for other online retailers such as CinemaNow, Movielink and AOL.
Initially, Apple was pushing to sell all films for $9.99, just as it sells songs for a flat price of 99 and all TV shows for $1.99. But due to studio pressure, it will launch with two price points: $9.99 for library titles, $14.99 for new pics in the DVD window."
Not only is this the same type of behavior we saw to a certain extent with iTunes in the context of music, and moreso with television programming, I'm quite glad that Apple is pressuring the industry on the price issue, similar to the way they took a significant part in pressuring MPEG LA for reasonable licensing terms, which made the MPEG-4 family of protocols, including H.264/MPEG-4 Part 10, actually usable by normal people for content creation, broadcasting, and playback without the encumbrances of royalties and per-use/per-time fees that would have all but killed MPEG-4 and H.264 on anything but OEM devices and commercial broadcast services.
Then there's the question of usability: the same thing that has made the iTunes universe so attractive to users is still there as it has transitioned to video. It's not just a simple "download a media file and do with it what you will" service (though it can be treated as such; note I'm not talking about this in the context of DRM, I'm speaking in terms of the process via which you download something and play it) - it's a completely integrated system that normal people can actually use that has a pleasant user experience. With things like Front Row now shipping on all of Apple's systems, they've created an end-to-end solution that actually makes viewing, using, or listening to the content a tightly integrated experience that "just works". The turnkey nature of iTunes/iPod/Front Row has been one of the key reasons for its continuing success.
Does the name iTunes Music Store still really apply? If they are now selling movies and music, you would think a name change would come about. Just a thought.
DVDs are pretty cheap these days. If this service is not cheaper than a DVD, I wouldn't use it. This is why I think Amazon's service might not be all that popular. Can I burn it to a DVD? No, I'm probably just buying lower quality, DRM files that take forever to download - and its MORE than a DVD. No way.
I'll probably try Apple's service. Wiht their TV shows on iTunes, the problem has been lack of variety. That will apparently continue to be a problem with films on this service.
Avoid Missing Ball for High Score
Steve's on the Disney Board! This isn't a real surprise, give the stories about Hollywood's unhappiness over Apple's insistance on a single price for all movies, according to recent stories all over the Mac press.
Let Disney show 'em it works, then they'll fall all over themselves to join in, just like the music folks did...
"Money is truthful. If a man speaks of his honor, make him pay cash." Notebooks of Lazarus Long, Robert A. Heinlein
Full price of DVD, except you don't get the box nor the DVD (and most likely none of the DVD extra features), and you can't even burn the DVD from the DRM-infected file you spent ages to download.
Sure, this is going to be a HUGE hit.
Not.
To be fair, I don't think Apple's pricing is going to work either.
It's a store of music
A store of tunes
It's a store of lyrics
And a store of videos
There's so much that we share
On Peer-to-Peer, we swear
It's a small store after all
There is just one Apple
And one golden iTunes
And a smile means
Profits for ev'ryone
Though the Disney divides
And their pockets are wide
It's a small store after all
It's a small store after all
It's a small store after all
It's a small store after all
It's a small, small store
If "disco" means "I learn" in Latin, does "discothèque" mean "I learn technology"?
FTFA: "Because it also sells DVDs, Amazon has agreed to studio demands that digital wholesale prices not undercut those of DVDs. As a result, Amazon.com's digital download prices are expected to range from $9.99 to $19.99..."
"Initially, Apple was pushing to sell all films for $9.99, just as it sells songs for a flat price of 99 and all TV shows for $1.99. But due to studio pressure, it will launch with two price points: $9.99 for library titles, $14.99 for new pics in the DVD window."
Neither of these companies will get my business. Why the hell would I pay retail for a download when I can have it in a day or two on physical media with a case and an insert? $4.99, maybe - after all that would compete with "buying" a new release on DirecTV which I can save on my Tivo. This one I really don't get.
I still don't purchase (complete) CD's online - I'll take the packaging. Individual songs make sense since I might only care for a couple tracks on a disc. I've never had the desire to download specific chapters of a DVD. Music downloads are a whole different thing than video. Oh well, I hope the market takes care of this.
Although I wouldn't consider a DRM'ed movie on its own, I'd consider a packaged deal where I get the DVD in the mail, but in the mean time can download the DRM protected movie immediately (and obviously I'd be willing to pay slightly more than the typical DVD). This would benefit Amazon because I'd be willing to pay more to be able to view the movie sooner. This will benefit the studios because in addition to the higher price, I'm less likely to rip the DVD into a DRM free file since I already have a soft copy on my PC. This would benefit me because I'm an American and like instant gratification. The band Pearl Jam basically did this for live shows on their 2003 tour. You could buy MP3's of the show roughly within 24 hours, and they would mail you an audio CD (acutally most shows were two CD's, some three) of the show in a couple weeks. For fans this was great, and although I don't foresee the movie studio's allowing a non-DRM format for video, I'd still be a heck of a lot more motivated to buy a downloadable movie if I knew I'd be eventually receiving a full DVD copy.
Sadly, PS/2 was yet another victim of USB, which doesn't care what you plug into it, the electrical slut.
A typical movie, if compressed by half, will fit on a standard 4.5 GB DVD (unit cost $.10 without case). Immediately we see that the cost is greater than purchasing the real thing and the quality is much less, not only in terms of picture quality, but also in terms of packaging etc.
So far, this is not much different from music right? True. However! Many ISP's cap the downloads to 100 GB's/month if not less. Few spots in the US and Canada don't have capped downloads, where the iTunes store will first be releasing the movies. This means, that for those that want to buy a good amount DVD's they will have to pay a premium once they surpass their download limit. My ISP charges $1/GB over my 100 GB limit..or I can opt to get throttled down to dial-up speeds. Convenient...
Regardless, the cost of entry is simply not on par with downloading music wherein one does not have to wait hours for the download (usually) one has near immediate gratification. As well, with the plethora of DAP products, folks don't necessarily require (or rather desire) the jewel case, cover art, liner notes etc. Yet, with DVD's the vast majority WILL be ripping to a DVD and playing in their home unit watching on their TV, not on some tiny screen on a DAP.
With prices in the $10-20 range, only the diehards will go for this, or those with massive uncapped pipes (like sysadmins at a corp or university). Drop the cost to $5 and people will be far more eager to wait for the downloads, take their chances with their ISP quirks because $5 for the new Pirate of the Carribean movie is going to be far cheaper than the 15-20 they'll pay at Best Buy for the first month of its release.
There is absolutely no way that I would pay as much for a digital download of a movie as I would for a DVD. Common sense tells you that the pricing is wrong as there are no box or physical media costs. Nor is there the shipping costs to get the finished product to retailers. Then there is the format. Do I really want to pay full price to watch a movie on a screen the size of an ipod with video. No way! This thing is primed for failure. Consumers can be stupid at times, but they're not this stupid.
The best option for me is the local public library. They offer DVDs for free. Hard to beat free. I can reserve them on-line then walk in and the DVD is tagged with my name on it and setting on a self up by the checkout counter.
I don't get why people never get this. To manufacture a cd costs very little. I can make cds of me singing and sell them. But my singing is really really bad (It hurts my own ears).
/10$ = 1 million copies. Thats a lot of DVDs.
Content is more than the cost of the media. If I make a movie that costs 10 million dollars, and sell it on DVD. How many movies do I have to sell before I make my first dollar. (say I make 10 dollars per dvd sold).
10,000,000$
Everyone who does your thinking thinks of "blockbusters", movies that are so popular the cost per dvd sold is a very very small percentage of the cost of the disk. For less popular movies a good chunk of the cost of the DVD has already been spent on production.
Your right about the elasticity of demand though, cheaper means more buyers.
Well, you're forgetting a couple of things. One, for months, many rumor sites, analysts, and the prevailing best educated guesses have reiterated that there is definitely a "real" video iPod on the way (i.e., with a bigger screen and better video decoding capabilities), and that neither the video iPod nor the iTunes movie store would be launched until both were ready. So there may indeed be a new iPod alongside this announcement anyway. Two, even the current iPod can play up to 480x480 (albeit MPEG-4 Part 2), so this suggests that the decode capability just wasn't powerful enough on the current generation iPods. There's no reason higher resolution content can't be played back on a lower resolution screen: some of the detail will just be lost.
Of course, you are correct about the disparity in general between watching something on a portable device, versus a nice big TV. Hopefully Apple handles this gracefully, because people won't want 320x240 movies (though, even the 320x240 TV shows are not bad on a standard def TV, for most peoples' tastes).
LionsGate announced in August that they'd be part of the new movie store. So, why does Variety appear to be reporting otherwise?
While we're comparing price points here, let's not forget that a visit to the local movie theatre costs nine bucks. Hordes of people are willing to pay that much to see a film once, on a big screen with their peers. No ownership rights at all; and afterwards they will probably never see the movie again. Plus they have to leave the house, and will probably add a four dollar soda to the bill.
Clearly there is some flexibility in prices, mostly dependent on the interest level that a potential purchaser has. The less interested they are in seeing a movie, the more affordable and convenient you have to make it before they will open their wallets.
The only reason big business is pursuing internet-based distribution AT ALL is because they perceive a demand for the additional measure of convenience that the model could POTENTIALLY deliver, and they expect to derive an acceptable profit from constructing that model.
So the big question is: Is internet-based distribution a new niche of consumers - a third category beyond theatre-goers and DVD renters - who will be convinced to watch a movie via the internet? Or are these people just a subset of that second, established category of DVD renters? In other words, do they need a lower price to bring them on board ... or do they just need the same price they're already used to paying for a movie on DVD?
Personally, I think it's a subset of DVD renters. A small subset. People who own computers, and who watch movies primarily on their computers, yet are not particularly concerned with owning a physical copy of their data, and are just a bit too impatient to order a DVD in the mail. That's not a very big demographic, really. Maybe it covers a lot of college students who move too often for a NetFlix account, but at the same time, college students are rampant pirates, to whom most music and movies are contemptuously disposable.