Retailers Pressure Studios on Web Deals

mikesd81 writes "Over at the Associated Press, there's an article about retailers pressuring movie studios for the same deals that online servies are getting. Target has sent a letter warning 'that Target might have to reconsider the amount of shelf space allocated for movies if studios undercut the wholesale price of DVDs by giving online services a better deal on digital offerings.' At issue is the low price some studios charge for films downloaded through such fledgling services as MovieLink, CinemaNow and Amazon.com's recently launched video store. The two-disc rerelease of Disney's 'The Little Mermaid' now retails for $14.87 at Wal-Mart and $14.99 at Target. The movie can be bought for $12.99 on iTunes."

Comments

In other news...

[LordEd]

Retailers want money, shoppers want deals, and cats want all your base. News at 11:00.

Re:In other news...

[tygerstripes]

Then these web-vendors must be stopped - FOR GREAT JUSTICE!!!

Re:In other news...

[Anonymous Coward]

Subtle recursive jokes in sigs are not funny.

Neither are blatant recursive jokes in posts. See also: This post.

Finally, a taste of their own medecine

[tentimestwenty]

Target and Walmart have been undercutting stores since they opened by monopolizing distribution. Now they're going to get a taste of their own business model.

Re:Finally, a taste of their own medecine

[flight_master]

I agree with you, and I find it rather interesting that Wal-mart (up here, we don't have Target, so I can't speak about them) is complaining about being under-cut. I've seen many small shops close up since they've been in this town. Glad to see they're getting some 'competition' on their terms.


Christian

Re:Finally, a taste of their own medecine

[truthsearch]

The iTunes Music Store's business model is to pressure manufacturers to drastically cut production costs, undercut prices offered by smaller businesses, and compensate employees as little as possible? That's news to me. I thought it was to provide content for the sale of iPods and Macs. Silly me.

Re:Finally, a taste of their own medecine

[coolgeek]

I don't see any problem with the studios offering the same price for a movie to these retailers, for the same product. But a DVD is not a digital download. There is no reason they should expect a lower price on a physical DVD, there are additional manufacturing, warehousing, handling and shipping costs. This is just some old tired dogs trying to hang on to the past. We never heard them complain about the cable companies getting a lower price on movies...

Re:Finally, a taste of their own medecine

[Technician]

Target and Walmart have been undercutting stores since they opened by monopolizing distribution. Now they're going to get a taste of their own business model.

The article is missing the point that one is apples and one is oranges. The used Apple product can't be put on Craig's list or E-Bay. A physical product can.

Would you like to get a film for $15 and resell it used for $8 when you are done, or pay $13 and have it die with your hard drive?

This is one of the factors why online digital sales are still behind brick and mortar retail sales. Online downloads do not provide tangable merchandise. What's next, Pay per View on cable has to be sold at retailers DVD prices?

Re:Finally, a taste of their own medecine

[Anonymous Coward]

well, with the itunes versions being on DRM lockdown, and dvds being able to be played on any dvd player they (B&M retailers) should market against itunes and the likes by mentioning that fact. Join us in the fight against DRM people! I would pay an extra dollar per DVD if they would help fight them.

Re:Finally, a taste of their own medecine

[hcob$]

well, with the itunes versions being on DRM lockdown, and dvds being able to be played on any dvd player they (B&M retailers) should market against itunes and the likes by mentioning that fact. Join us in the fight against DRM people! I would pay an extra dollar per DVD if they would help fight them.

Silly me, I thought that DVD's were DRM'd(encrypted). But a fallicous argument never stopped the US Consumer from listening.

Re:Finally, a taste of their own medecine

[drinkypoo]

Silly me, I thought that DVD's were DRM'd(encrypted). But a fallicous argument never stopped the US Consumer from listening.

CSS is a kleenex. You can sneeze a hole in it.

The actual problems with copying DVDs are the ways they deviate from the standard in order to make the DVD unrippable.

Philips actually came down on some people for using the COMPACT DISC logo on CDs mastered some funky way to make them not be rippable (without using a data track, they were unreadable in data drives, but worked fine in audio) and told them they had to unfuck the CD or stop using the logo or get sued. Not sure how it all fell out though. But regardless, the DVD consortium, if it had any integrity which we know it doesn't, would be doing the same thing.

Re:Finally, a taste of their own medecine

[jZnat]

Nah man, they're just undercutting them, and that's what Walmart and Target did. iTS can do that without having to lay off people and whatnot.

Re:Finally, a taste of their own medecine

[hcob$]

CSS is a kleenex. You can sneeze a hole in it.

True, it's easy to break. But I was thinking in more /. terms: "It has DRM... regardless of how easy it is to break, it has DRM." I mean, look at iTunes. They even TELL you how to break it and people still don't like apple for selling "DRM Crippled" Music.

Re:Finally, a taste of their own medecine

[drinkypoo]

No, they do not tell you how to break it. In addition, you cannot circumvent it. Oh sure, you can burn the song to a CD, then re-rip it, losing quality in the process - this does not circumvent the DRM. Circumventing the DRM would result in a non-DRM file with no loss of quality. I can re-rip the song through the analog hole, too, and this is really no different except the specific source of the loss of quality.

Re:Finally, a taste of their own medecine

[hcob$]

I can re-rip the song through the analog hole

Off Topic:
I always find it funny that the RIAA is trying every way possible to plug the anal log hole. At least they could start putting small packets of vasoline in every CD for when they finally come after you.

Re:Finally, a taste of their own medecine

[r3m0t]

They stopped using the logo.

Re:Finally, a taste of their own medecine

[unity100]

Yea totally agree ! Have at them !

Re:Finally, a taste of their own medecine

[Ucklak]

Target and Walmart have been undercutting stores since they opened by monopolizing distribution.

I wasn't aware that Best Buy, Fry's, Krogers, Safeway, Albertsons, Publix, Circuit City, Ultimate Universe, New Generation, Silo, Costco, Hollywood Video, Blockbuster, NetFlix, Suncoast, and any other distributor of media utilize Target and Walmart channels for distribution.

Target and Walmart are effective wholesalers that makes them effictive distributors which gives them the advantage of undercutting smaller stores.

I doubt Costco, Fry's, et al. use Walmart's and Target's wholesale channels either.

Re:Finally, a taste of their own medecine

[dangitman]

CSS is a kleenex. You can sneeze a hole in it.

How does that make it not DRM? Fairplay is also easy to break. So, I guess that means Apple doesn't use DRM? Hell, Apple even allows you to convert the files to a non-DRM format with their own software. The studios who sell DVDs don't give permission to do that, you have to break the (stupid) law to do that, but iTunes allows you to do it legally.

It's rather pathetic how people will rant about DRM, and then claim that DVDs are not DRMed because the DRM is easy to break. It doesn't matter how easy it is to break. Even more sad/hilarious, the same people will often say "DRM can never work" in their arguments, but then point to broken DRM as a justification for their using DRMed products. Hang on - didn't you just argue that all DRM is broken? So, if it's OK to use broken DRM, then it must be OK to use any DRM, as it is by definition broken, right?

Re:Finally, a taste of their own medecine

[dangitman]

Oh sure, you can burn the song to a CD, then re-rip it, losing quality in the process - this does not circumvent the DRM.

If I re-ripped it in a lossless format, how would I lose quality? It would sound exactly like the original file.

Again, this is something that doesn't seem to bother people when it comes to DVDs. Even though you can rip an exact copy with deCSS, a great number of users then go and recompress the DVD in order to create a smaller file.

Once again, a double-standard when it comes to iTunes vs. DVDs. You also have the option of losslessly removing the DRM from iTunes purchases, but that would be "illegal" and be done with gray-market software, exactly as it is for DVDs. At least you get some authorized option for converting your files with iTunes. And it doesn't have to involve loss of quality.

Re:Finally, a taste of their own medecine

[drinkypoo]

CSS is a kleenex. You can sneeze a hole in it.

How does that make it not DRM? Fairplay is also easy to break.

It deosn't make it not DRM. It just makes it not worth talking about in terms of logistics. Fairplay is different; because it does not depend on a fixed implementation it can be upgraded, which has happened twice, and will likely happen again. Thus fairplay is serious DRM, and CSS is a joke of DRM. It's still DRM but again, not worth discussing outside of examinations of the concept of DRM.

Sorry I didn't make this clear, I keep forgetting there's a million accounts on slashdot today and it's not news for nerds any more, it's noobs with nerve.

Re:Finally, a taste of their own medecine

[dangitman]

Would you like to get a film for $15 and resell it used for $8 when you are done, or pay $13 and have it die with your hard drive?

Talk about a strawman false dichotomy. Have you never heard of backups? Do you only use software that comes in physical form? Do you print out all your email? Watch out man, you'll lose it when your hard drive dies!!!

How about an equally (in)valid argument: Buy downloaded films/software, or have them die when the physical media gets damaged!

Re:Finally, a taste of their own medecine

[drinkypoo]

Oh sure, you can burn the song to a CD, then re-rip it, losing quality in the process - this does not circumvent the DRM.

If I re-ripped it in a lossless format, how would I lose quality? It would sound exactly like the original file.

That's nice. I don't use lossless compression audio formats, because they aren't supported by any of my mp3 players, and even if they were, they'd take up too much space.

Again, this is something that doesn't seem to bother people when it comes to DVDs. Even though you can rip an exact copy with deCSS, a great number of users then go and recompress the DVD in order to create a smaller file.

We call this logical fallacy a "straw man". With a DVD you have the option to keep full quality. Most of us don't do it because you need to use dual-layer media and it's expensive. This is a bullshit argument. We're not talking about practice, we're talking about possibility.

Once again, a double-standard when it comes to iTunes vs. DVDs. You also have the option of losslessly removing the DRM from iTunes purchases, but that would be "illegal" and be done with gray-market software, exactly as it is for DVDs. At least you get some authorized option for converting your files with iTunes. And it doesn't have to involve loss of quality.

And when Apple updates FairPlay again, which cannot be done with CSS, then once again there will be no tool that does this for a time.

Re:Finally, a taste of their own medecine

[Trumpet of Doom]

Out of curiosity, what happens if you just convert to a different file format and then back?

Re:Finally, a taste of their own medecine

[drinkypoo]

If either format is lossy then you lose quality. Is this a trick question? If both formats are lossy, then you lose more quality, but converting from MPEG2 to full-frame video and then back to MPEG2 at the same bitrate and format (same frame structure) will lose data.

Re:Finally, a taste of their own medecine

[Trumpet of Doom]

Not a trick question. I was wondering about possible DRM removal that way.

Re:Finally, a taste of their own medecine

[dangitman]

Thus fairplay is serious DRM, and CSS is a joke of DRM. It's still DRM but again, not worth discussing outside of examinations of the concept of DRM.

So, it's not worth discussing, just because you think so? It doesn't help your argument, so you choose to ignore it.

Also, you imply by your argument that DRM can work, and it won't inevitably be broken. I take it that you argue against those who make such arguments, and never use it as a reason to oppose DRM?

Sorry I didn't make this clear, I keep forgetting there's a million accounts on slashdot today and it's not news for nerds any more, it's noobs with nerve.

Wow, that's arrogant. Someone is a "noob" because they question hypocrisy in an argument? Sorry buddy, I'm anything but a noob. I've been around since the BBS and usenet days.

I don't like DRM myself. Buit what I can't stand more is hypocrisy and lack of logical consistency.

Re:Finally, a taste of their own medecine

[dangitman]

That's nice. I don't use lossless compression audio formats, because they aren't supported by any of my mp3 players, and even if they were, they'd take up too much space.

So, why not store them on your hard drive in a lossless format, and have your player software convert them to a smaller form at when you sync your player? When listenoing portably, it's usually very difficult to hear the dikfference, because of the typical noisy environment. Even in a quiet environment, it's difficult to tell the difference between an original 128kbps file that has been recompressed at, say 256kbps. Even at 128kbps it's usually fine for general listening. Nothing at all like an analog copy.

We call this logical fallacy a "straw man". With a DVD you have the option to keep full quality. Most of us don't do it because you need to use dual-layer media and it's expensive. This is a bullshit argument.

That's exactly the argument you used above for not using lossless. You DO have the option of legally retaining full copies from the iTunes store. You just choose not to. It is not legally possible to do this with a DVD. It is possible to do it with gray-market software, as I previously mentioned. But that is also possible with iTunes tracks and gray-m,arket software.

So, if we are talking about possibilities then iTunes purchases.actually gives you more choices than DVD.

It's hilarious that you lecture me on logic, and then immediately contradict your own logic.

And when Apple updates FairPlay again, which cannot be done with CSS, then once again there will be no tool that does this for a time.

Then maybe it will be broken. You don't know what will happen in the future. I'm talking about what the reality is now. Apple can't force you to update your files. So, if you hear about an update that breaks those tools - don't buy any more tracks, or crack the ones you already have before you update. Exactly as you would with DVD. If somebody starts shipping DVDs with additional copy protection, don't buy them. It doesn't affect your existing DVD purchases.

Re:Finally, a taste of their own medecine

[dangitman]

If either format is lossy then you lose quality.

Incorrect. If the CODEC (not format) you are recompressing with is lossy, you will lose quality compared to the original file. If the CODEC is not lossy, you will get the same quality as the original file.

By "original" of course, we are talking about the compressed file - such as the MPEG-2 on a DVD, or the AAC-encoded song. Because, if that is your "original" the quality has already been lost in encoding. Your DVD is not the same as the 35mm film that it was made from. But you do not have access to that original. Likewise, you don't have access to the studio master audio files.

So, a lossy-compressed master file compressed to a lossless format results in a file of the same perceptible quality as the file it was copied from.

Another thing - isn't it interesting how people complain about lossy music files from download services, but are just fine with the lossy, low-resolution video that comes on a DVD? I mean, how can you stand to watch that, rather than a 35mm print from the original?

Re:Finally, a taste of their own medecine

[MacJedi]

Another thing - isn't it interesting how people complain about lossy music files from download services, but are just fine with the lossy, low-resolution video that comes on a DVD? I mean, how can you stand to watch that, rather than a 35mm print from the original?

35mm film prints of movies are analog. I would not have a problem with mp3s from a vinyl record. ;)

Re:Finally, a taste of their own medecine

[Technician]

Have you never heard of backups?

Yes. Have you ever heard of DRM? The backup simply won't work on your replacement hardware. That's the whole point of DRM. My physical DVD will play in any DVD player from the same region. My legal downloaded (DRM'ed) movie will not play in any other computer in my house present or future.

Re:Finally, a taste of their own medecine

[dangitman]

Yeah, they're analog, but still a lot higher quality than a DVD. It's hard to equate directly to pixel resolution, but a well-shot film must have many millions of "pixel equivalents" - tons of detail, basically. A 720x480 DVD has a mere 345,600 pixels, plus is compressed with MPEG-2, which often introduces artifacts. Yet you don't hear slashdotters saying "how could anyone watch a compressed movie?" the way you hear them saying "how can anyone listen to compressed audio"?

Re:Finally, a taste of their own medecine

[shoemilk]

The point of the post is still valid, the point isn't about its back-up-ability, but about the re-sale-ability. Would you like to get a film for $15 and re-sell it used for $8 when you are done, or pay $13 plus about another dollar for a disk to back it up on that you can't sell? btw I love you sig

Re:Finally, a taste of their own medecine

[dangitman]

Yes. Have you ever heard of DRM? The backup simply won't work on your replacement hardware. That's the whole point of DRM.

That may be the way some people implement it, but it's not true for the most popular service - the iTunes store. You can easily back up, and transfer the files between computers. So no, the purpose of DRM is not to tie it to one specific computer - unless it is a terrible implementation. A sane implementation allows people to authorize and deauthorize computers, for things like hardware upgrades.

My point is not to defend DRM, but at least get your facts straight. It's pretty annoying hearing misinformation being used to attack DRM. I'd rather have no DRM, but nobody is going to take you seriously if you don't even know what's available.

My physical DVD will play in any DVD player from the same region.

But it won't play a DVD purchased in another region. Meanwhile, the iTunes DRM allows you to cross regions. I find the "region" thing much more annoying than having to authorize a machine, as I am a fan of international movies.

Re:Finally, a taste of their own medecine

[dangitman]

I'd rather keep it. Being able to back it up means it will last longer. Assuming I didn't have the abiliuty to back up DVDs, albeit in an "illegal" way. Come to think of it, I don't back up DVDs, because the physical media gives a false sense of security. But I back up everything I download in duplicate.

One thing:

The point of the post is still valid, the point isn't about its back-up-ability, but about the re-sale-ability.

That may be one of the points, but why did he claim that you lose your media when the hard drive dies? That's why it's a false dichotomy - not everybody sells their old media, and not everybody neglects to make a backup of their downloaded media.

Thanks for the sig compliment, BTW.

Re:Finally, a taste of their own medecine

[Technician]

That may be the way some people implement it, but it's not true for the most popular service - the iTunes store. You can easily back up, and transfer the files between computers.

I don't do the I-tunes store simply because they sell tunes in a format that is foreign to over half my playback equipment. I can't play it in the living room in the DVD player, In my car MP3 player, in my kid's Lyra MP3 player... Only the PC and my Daughter's Nano can play things from the I-tunes store. For everything else, it's an incompatible format.

I know, yada yada you can burn a CD. Big deal. Burn a CD, Rip CD to MP3, burn MP3 CD... Too much hastle. Stick with MP3's in the first place. They play just fine. No need to beg the mothership when you want to transfer the tunes to another PC. I upgrade PC's every few years, but I don't have to ask anyone for authorization to play my LP's from the 1980's or my CD's from the 1990's because I bought a new turntable or CD deck. Playing "Mother May I" was finished for me over 30 years ago.

Re:Finally, a taste of their own medecine

[shoemilk]

I find the "region" thing much more annoying than having to authorize a machine, as I am a fan of international movies

I highly agree with you. Everyone sits around and complains about DRM but no one seems to care about region codes. I don't think there's anything less ethical than region codes. Why should I be punished for being an American living in Japan? Why should I have to buy a seperate DVD player for my American DVDs? Why can I only change the region on my laptop's drive 5 times? I want to play my LEGALLY purchased DVDs anywhere I want. So far, that's the only benefit I see from the iTMS movies; there's no region.

Re:Finally, a taste of their own medecine

[Anonymous Coward]

If I re-ripped it in a lossless format, how would I lose quality? It would sound exactly like the original file.

Just bigger than it needs to be for the quality it is.

Again, this is something that doesn't seem to bother people when it comes to DVDs. Even though you can rip an exact copy with deCSS, a great number of users then go and recompress the DVD in order to create a smaller file.

Only for copies that have to traverse the internet tubes. And potentially people that like having big-HDDs-of-movies. If they use H.264, they are not really losing much quality. XviD: they are losing lots of quality. Maybe you're right. People don't go for perfect quality in movies. But even an XviD rip of a DVD is closer to the quality of a DVD than an iTMS AAC is to a CD, or a reencoded AAC is to an iTMS AAC. Downloadable music is already borderline crap. Rencoding just brings it closer to that crap-line.

Once again, a double-standard when it comes to iTunes vs. DVDs. You also have the option of losslessly removing the DRM from iTunes purchases, but that would be "illegal" and be done with gray-market software, exactly as it is for DVDs. At least you get some authorized option for converting your files with iTunes. And it doesn't have to involve loss of quality.

Burning to CD and then reencoding to lossless/lossy is at least a waste of time (longer than realtime), and possibly a waste of media.

Decrypting with QTFairUse is just about realtime.

Decrypting DVDs takes about 20 mins for a 90 min or so movie (4x speed or so). So DVDs are still much more convenient no matter how you do it.

(Incidentally, decrypting PlaysForSure DRM is also much faster than Fairplay. Also, QT mov encryption hasn't even been cracked)

Re:Finally, a taste of their own medecine

[ben there...]

Correction: Burning to CD and reripping/encoding for whole albums is faster than realtime, but still longer than ripping a DVD.

Re:Finally, a taste of their own medecine

[ronanbear]

How is iTS DRM different in terms of region encoding. I live in Ireland and can only get what's available in the Irish iTS. No free single of the week, no movies, smaller catalogue, higher prices. I missed the part about any of that being better than a DVD player which takes 2 minutes of searching on the net to region unlock.

Apple laptops are much harder to region unlock. I like iTS but I wouldn't call it more region friendly than the DVD implementation.

Re:Finally, a taste of their own medecine

[drinkypoo]

Yet you don't hear slashdotters saying "how could anyone watch a compressed movie?" the way you hear them saying "how can anyone listen to compressed audio"?

I think a lot of this has to do with the structure of our brains. If you were talking to a dog, they might be upset if the smell track were compressed :P

Seriously though, our brains have more dedicated wetware for processing vision than any other sense. As I have passionately ranted about previously, you are not seeing what you think you are seeing. You are seeing a heavily processed representation of the data produced when photons strike your retina. In some ways this is good, because it lets your brain do amazing things with vision - for example, I remember watching a bit on TV where there was a dark field with a collection of lights floating in space, which was meaningless - but then they moved and it was immediately clear that they were attached to the major joints of a human figure. We do an amazing amount of processing.

But actually I also think there's another, simpler reason you don't hear complaints; Usually the reason we recompress video is to make it smaller. But, when you're recompressing audio because you're using Apple's workaround of burning to a CD and then ripping again, you're not [necessarily] making a smaller file. In fact, I like to make 320kbps mp3s, because most things will play them (although some players top out around 224kbps for some reason - but more play 320kbps than properly play VBR of any bitrate) and so that would likely be larger than the AAC. But, I'd still lose quality. Even if I started with a low-bitrate AAC, I'd want to use a high bitrate of mp3 because I don't want to put mp3 artifacts on top of AAC artifacts - the combination might not be too bad, or it might be synergistically worse.

Re:Finally, a taste of their own medecine

[tal_amir]

iTunes has it for 14.99, not 12.99

Re:Finally, a taste of their own medecine

[Anonymous Coward]

Because they watch films on a 30ish" TV and not a full-size cinema screen ?

Re:Finally, a taste of their own medecine

[dangitman]

Just like people listen to their downloaded music on cheap earbuds in noisy environments, right? My point was exactly in this hypocrisy. If most people really cared about quality, they would watch their films on a cinema screen, and not a TV. They would listen to their music on a Hi-Fi in a soundproof room, not on a portable player. So compressed media does have a place, and the "I only listen to lossless" people are ignorant of reality.

Re:Finally, a taste of their own medecine

[dangitman]

On what planet? CD rips take very little time.

As to your comments about audio quality, I think you are wrong. A 128kbps MP3 or AAC is a lot closer to the CD than a re-encoded DVD, and a DVD is miles away from a film print.

Re:Finally, a taste of their own medecine

[ben there...]

On what planet? CD rips take very little time.

I think you meant to say "burning AAC to CD, reripping, and reencoding to AAC/mp3 takes more than a few minutes."

A 128kbps MP3 or AAC is a lot closer to the CD than a re-encoded DVD,

Again, it's a reencoded mp3 or AAC that's a lot worse than a reencoded DVD. But even with your idea of what I was talking about, I'd notice the quality loss of an iTMS AAC on commodity $50 stereo speakers. During normal play (no freeze-frame, no slow-mo), I'd notice the difference in the XviD or H.264 on a high-end HDTV.

Re:Finally, a taste of their own medecine

[shoemilk]

Are you Irish or an American living in Ireland? Japan's iTMS is the same way as Ireland's (much smaller selection, 200yen (about US$1.90) per song, no movies of free singles), but as an American with my American credit card, I can't buy anything from Japan's iTMS anyway (unless I applied for a Japanese card or bought a gift card from a store). Personally, I would have thought that the PAL-NTCS thing would have been a bigger issue (borrowing DVDs from my UK friends here (region 2 PAL) won't play on my normal DVD player (region 2 NTCS)).

Apple laptops are much harder to region unlock

Yes, I do have a mac laptop and desktop. But why should I have to resort to methods that void my warrantee? Why should I have to do that 2 minute search on the internet in the first place? Why should the people that write those firmware patch have to write them? (btw, apple drives aren't harder, it can't be done with anything released in the last two and a half years, there is no firmware patch for it (guy writing them got tired of it and the money it required) and VLC doesn't work. If anyone does know where to get a patch for the matsushita drives, please please please let me know)

Huh??

[joshetc]

Wasn't it the distributers that said the cost of the media and packaging made up a great deal of the cost of DVDs? I'd say the retailers are getting a pretty good deal with only $2 difference between the DVD + packaging + extras vs just a video file.

Re:Huh??

[Jonny_eh]

Bandwidth and server maintenance costs too, albeit not nearly as much as DVD packaging/shipping. Or does it?

Re:Huh??

[Mr. Underbridge]

Bandwidth and server maintenance costs too, albeit not nearly as much as DVD packaging/shipping. Or does it?

Nowhere near. And if you're counting server maintenance, add the cost of the store, theft of stock (that gets passed on to the consumer too), and employee salaries, all of which cost much more for a real store.

Re:Huh??

[n2art2]

Could just be me, but I'm guessing that the studios are not paying for the server and maintenance costs, but the online stores themselves are covering those costs, as a cost of their business model. That is non-related to the cost of the product being sold the said retailers.

Think about it this way. . . . Target orders 500 DVD's of a new release to stock on it's shelves. Apple orders 1 digital copy of the same release to host on Apple's servers, and to resell on itunes 500+ times, then just cuts the studio a check for the total of number of copies purchased.

Which model costs more to produce and distribute??????? Target has to pay up front for whatever quantity of movies they want to stock. Normally, if they don't sell them, there is a slim chance they will get the investment back, and be able to send the DVD's back. However with the online model, there is no stock needed to be purchased, and it is much cheaper for the studio to send the release to the online retailer's servers. So it is cheaper for the studios and it is cheaper for the online retailers as well.

And if Target and Walmart stop stocking the releases, do you really think people will stop buying them????? Heck no. They will look for another distribution source. And what does that mean for the online retailers?????? More business!

Re:Huh??

[nine-times]

And a video with lower picture quality and audio quality than the DVD, with no DVD extras, etc. But you know what? And what's with the threat, anyway? "If you take an action that might possibly hurt our DVD sales business, we'll cut ourselves out of the DVD sales revenue completely!" If I were the movie studio, I'd call this bluff.

Re:Huh??

[shmlco]

Disney said they sold 125,000 movies on iTMS the first week, which works out to be roughly 150,000 GIGABYTES of data transfer. Plus having the servers to process transactions and deliver said content in addition to the TV shows and songs already there.

I'll submit that building and maintaining the infrastructure to deliver that much paid content in a timely and reliable fashion is not cheap.

And that's just the first week...

Re:Huh??

[Anonymous Coward]

How much porn gets download from the bittorent sites weekly?

Grant it, it's not a perfect analogy, as bittorent puts the burden on the "consumer"'s line.

But I can "share" a (download, and then upload) 2 hour video (note, I said video, as in home, not copyright stuff) at DVD quality (not reduced) in about a day (depending on the speed of the other side), at my "overprice" American Verizon fiber optic connection (42.99 per month, divided by 30, makes it $1.30).

I'm sure buying bulk bandwidth costs less than that........ $9.99 is a pretty sweet price for Disney.

Re:Huh??

[n2art2]

You don't get it do you????? Diseny is not paying for the bandwidth of all those downloads, Apple is. It's the same relation of cost, that Target pays for the stock boy to load the shelves, and for their lights to be on, and for the floors to be swept, and for their doors to be open. Bandwidth is an expense of the retailer, not of the supplier. In this case, the supplier is the studios, and all they have to do is send one "master" digital copy to Apple, and then It's Apple's responsibility to host that file on their servers, and then Apple pays the studio for the amount of times that particular file is purchased and downloaded from Apple's Servers.

So, Disney has the expense of sending the movie one time to Apple, and then collecting the money for each download that Apple processes. That, my friend is very cheap for the studios.

Re:Huh??

[shmlco]

So? MSRP for new DVDs are usually in the $19.95-$25 price range. Some retailers may mark it down and use new cheap DVDs as loss-leaders, but the retailers still take a good hunk of the change. And the disc and packaging for a physical product produced in the quantities needed to get into WalMart or Target is right around a buck, buck and a quarter.

Apple is doing preorders at $12.95 and taking their cut (0.95) from that leaving $12 for Disney. The box stores are paying roughly $13-14 and marking up from there.

So subtract the cost of the disc from what the boxes are paying, and you find that Disney is--surprise--making about the same amount from Apple as from WalMart for the same "costs".

'Course, they did spend about $30-40 MILLION on their last feature...

SOP

[NineNine]

Standard Operating Practice. I own a retail store, and this happens every day. Manufacturers have to be very careful not to undercut their brick-and-mortar retailers, else they'll lose them. I did the same thing just last week. I found one of our manufacturers selling their products at my wholesale cost online. I told them that they need to fix that, or I'll dump the products. As is, I have customers coming in asking me why we're more than the website, and why they should bother shopping at my store if I'm going to rip them off. Manufacturers can never undercut their retailers (or let one retailer grossly undercut another), otherwise they risk losing them. And, without the retailers, they're dead in the water.

Re:SOP

[jellomizer]

So with logical conclusion if these Brick-Mortar company refuse to sell these products because the web undercuts them then there will be a point were the Brick-Mortar will not have anything to sell. Still the iTunes price vs. the DVD price isn't much of a difference. Still as of right now most people want a DVD to play on their TV not on their Computer Screens. As well DVD Quality is a bit higher then iTunes, You have physical medea which you can touch and bring to families homes to watch, together. Retailers shouldn't worry to much right now about iTunes, killing there market and the last thing they should do is say no to Disney because with all the effort Disney advertises their products not having it availaible will only stop sales not expand them.

Re:SOP

[Lumpy]

good luck. Panasonic recently screwed every store owner selling their plasmas. I'm an integrator and sell Panasonic 50 inch and large plasmas to my customers wanting built im goodness in their $3,000,000+ homes, but if they can get that same TV at below my cost online they do raise eyebrows.

We asked panasonic and they told us to pound sand, if I was willing to buy 10,000 set's they would give me a deal.

You are trying to fight against massive volume and you will never win. Granted the dumb consumer will buy the $600.00 lower priced plasma from some e-tailer, spend $350.00 in shipping to get it to him, and if he has any problems we gladly help at the tune of $120.00 an hour because it was not purchased from us, or it's actually a different model shipped to them so it does not fit the hole we made, does not have RS232 for crestron integration, lack discreet IR codes, etc.... so it either get's sent back for antoher $180-300 in shipping or we do a change order to modify for the new device and end up charging for 2 hours of programming, labor and materials.

so in the long run they saved nothing by buying it below my cost elsewhere. But then most consumers are not that bright to begin with. they see a shiney at low-low prices and ignore all the added expenses.

Re:SOP

[TheWoozle]

As is, I have customers coming in asking me why we're more than the website, and why they should bother shopping at my store if I'm going to rip them off.

Then you shouldn't have any problem keeping them as customers. It's simple: ask them how much they will pay in shipping (I bet they'll be surprised that the website really isn't any cheaper after they add in shipping). Ask them if they prefer to wait 5-7 business days for their purchases.

Also, perhaps you should consider not stocking items for which people *are* willing to shop online, and concentrate on items which people are more likely to want to have immediately upon purchasing. I know that I'd hate to have to wait for my toilet paper to arrive via UPS ground.

Re:SOP

[Lazarian]

Hmmm. That kinda makes for a different perspective on the Wal-Mart is Evil* thing.

*I still think they are, but that's beside the point.

Re:SOP

[14CharUsername]

Without products to sell the retailers are dead in the water.

Re:SOP

[Anonymous Coward]

You want toilet paper immediately upon purchasing? Uh... how soon are you thinking of using it? Couldn't you at least wait until you got it home?

Lots of people actually do purchase their toilet paper online, at least in the UK where online grocery shopping does work.

Re:SOP

[Anonymous Coward]

And most brick-and-mortar retailers are so scared to death of the fact that consumers are smart enough to get the best deal for their money (and now have the tools to do so), that they try to perpetuate myths like the nonsense you're spreading here.

Re:SOP

[mcmonkey]

And, without the retailers, they're dead in the water.

And where are you without manufacturers?

I understand your interest in not having manufacturers cut out the middle man, but don't forget that's exactly what you are--a middle man. It sounds like both the manufacturers and your customers are questioning the value you add to the transaction. You'd better have a good answer if you want to stay in business.

So what was you answer? Why should customers bother shopping at your store?

Re:SOP

[jedidiah]

No. Consumers are generally interested getting a percieved bargain at the expense of all else including longterm actual cost (the monthly payment mentality), features & incidental costs like shipping or shipping time.

This is why Detroit and Redmond are still in business and why Walmart does so well.

Re:SOP

[Jeff DeMaagd]

The problem is that anyone that thinks that a downloaded movie file is comparable to its DVD counterpart is, quite frankly, delusional. It's not undercutting because it's not the same product, not the same quality and certainly not the same level of features. The iTunes version doesn't offer 5.1 audio, multiple audio tracks, any subtitle or caption tracks, any interactive features, no commentary, no bloopers/outtakes, music videos, interviews or anything like that, just a more heavily compressed video file with one stereo audio track. Heck, they can only be played on one brand of portable media players, whereas with DVD, you can pick from any portable DVD player. Maybe there are people that don't care about those differences.

Re:SOP

[NineNine]

We offer service. The things that I sell are relatively high end. A few manufacturers have tried dumping into the big box stores, but with bad results. With no sales people, their products simply don't sell. And once they've pissed off the smaller guys, like me, who provide service and sell their stuff, they're pretty much screwed. Maybe this works if you're selling identical, commodity items, such as movies, but for many other products, you can't do this. Going from independent retailers to Big Box is risky as hell, and it often doesn't work out well, especially for manufacturers that don't manufacture bottom-tier stuff. You have to put all of your eggs in one basket, and that's a very low margin basket that can completely kill your product at will.

Re:SOP

[SteveXE]

"DVD Quality is a bit higher then iTunes"

Who are you kidding a bit higher? DVD is alot higher then itunes. Have you ever tried to upsample a itunes movie to 720p or 1080i? It looks like someone vomited on your screen but do the same thing with a DVD and it actually looks better then it did at its native resolution.

Re:SOP

[vanyel]

I worked for "a large chipmaker" which had the same problem when they dabbled in the retail market, vs their typical OEM channels.

In this case, it really pisses me off as a consumer. These are different products with different costs and different benefits. It's even worse in the ebook business: a large number of the books I want to buy in e-formats are being sold at *hardcover* prices. It is absolutely inexcusable to make the consumer pay for the production costs of a book when there are essentially no production costs. ebooks should be priced slightly lower than paperbacks, though I'm willing to pay paperback prices for the convenience of access. But because of this same nonsense, they're preventing the consumer (or at least a subset of them) from getting what they want.

What they *should* be doing, if they want to compete, is put up kiosks where you can plug in your device and download on the spot at local speeds. They could get the product at e-prices and compete, they get the consumer's impulse shopping from seeing the product (or displays), the consumer gets instant downloads (and for movies in particular, even with cable and DSL, local is going to be much faster). It would be a win for everyone.

Re:SOP

[nine-times]

What you're saying makes sense, and I haven't really thought about that. At the same time, these complaints seem unfounded since it's a different distribution method entirely distributing what is in many ways a different product. I can understand why Wallmart and Target wouldn't like it, but at the same time, it seems a little crazy for them to be threatening this way.

The way I figure it, people love TV and movies. They're going to want to see them. The studios love making them and love selling them and love buying them. Now a couple of your middle-men are complaining that they're being undercut, when they're accustomed to being the ones who undercut other middlemen. They're threatening to stop being middlemen. I say, there's a supply and there's a demand, and if they don't want to make the money of being a middleman (which is all they do), then find someone else who does want that job. There are other brick and mortar retailers, other online retailers who will still sell the box, and now these digital retailers. There are cable companies with their video on demand. There are PLENTY of routes to distribute movies. Just go ahead and tell Wallmart to go frack themselves.

Am I underestimating the 800 lbs gorilla? Maybe. But if we're really at the point where one retailer is so dominant that they can bully whole industries into refusing to distribute through competing channels, then I think we have a bigger problem.

Re:SOP

[sandwiches]

Other than the initial advertisement and public exposure, I fail to see why any manufacturer of any kind of product would need to perpetually sell their products in a brick & mortar store.

Re:SOP

[Kevin Stevens]

I am sorry, but I call FUD here.

I bought an LCD Projection 50" TV online about a year and a half ago. Price in brick and mortars: $3000. Price online: $2000. Delivery $150. I got it in two days. I was a little skeptical about how great a deal I got so I put it on my Amex for protection in case the site was bogus. I had no problems whatsoever though.

You sound like a high end, high service type shop that probably does a decent job of informing your customers, which is great (though usually one pays through the nose at places like this, even compared to places like Best Buy). However, for those of us that are techies/enthusiasts and research the shiat out of any electronics purchase over $50, we just don't need you and we will go online and save a ton of money.

I have saved about $2000 (about 30% on average) by buying big ticket items online. I have heard similar arguments from my aunt who is a retail manager that you have. Your talking points are almost exactly the same, though she tends to focus on the "price difference is not that great, and if you have to take it back, you're screwed." angle. Perhaps you should consider getting into the e-tailing business instead of getting beat up by it?

Re:SOP

[mei_mei_mei]

Your business is complicated, DVDs aren't - people just want the cheapest.

Re:SOP

[danpsmith]

And, without the retailers, they're dead in the water.

Maybe, maybe they are dead in the water. But let's face it, while bricks and mortar presence is sometimes nice and an added bonus, it is not necessarily the best or even a desirable way to deliver all or even most products.

There are some downfalls of online distribution: shipping costs, no instant gratification, etc. But there are many bonuses too: no sales tax, almost unlimited availability.

I think if online stores selling digital versions of media undercut retailers to the point where some retailers eventually go away you might lose some stores, but maybe that'll cut into the proliferation of stores where there used to be social spots and the overall corroding of the build a mini-mall every 10 minutes attitude of Americans in general.

If online shopping is the price I'd have to pay to perhaps not have every square inch of America covered in strip malls featuring the same god awful chain stores just because some bozo thinks it's a good idea to have a starbucks next to a starbucks, I'll gladly pay it.

However, if they let retailers unfairly fix the price of online products simply so they don't undercut them, they completely lose the online market. 12.99 for a non-physical DRMed copy of a movie that might not even be readable should someone decide to change formats really doesn't make me want to buy it, when I can grab the real copy for 14.99. They can whine about piracy all they want, but pirated movies don't contain any DRM at all and for people who want the movie without the restrictions this sometimes becomes the alternative. It's a bonus that they don't have to pay for it either. Online media should be a _cheaper_ alternative because you aren't manufacturing anything, remember? All the media costs should go out the window. Until they do, I doubt many people will chew on that apple, no pun intended.

WTF?!?!

[ImaNihilist]

PROBLEM: People are paying 25% less for a product of inferior quality. Wait...what's the problem? Shit on iTunes is still way to expensive considering the inferior quality, no hard copy, and the inability to burn to disc. Why don't they just stop playing around, and come up with a unified pricing model for all media. CD, DVD, iTunes, Amazon - $9.99. Make everything $9.99 and I'll go on a buying spree right now. I'll spend $1,000 in the next 20 minutes.

Re:WTF?!?!

[rf0]

The thing is with most of the population they want to show off what they own and like to have a tangable good. I can either hold up my hard disk and say I've got 1000 MP3's / 50 movies on here in a sub format or have the DVD's and CD's on a shelf what I can take with me if I want to or lend to a friend. Also the physical formats are a lot harder to destory. It doesn't take much to delete a digital copy..

Re:WTF?!?!

[Rob T Firefly]

Plus, I can throw my DVD into a DVD player, computer, games console, or whatever else comes out in the future to support the format. I can enjoy whatever special features and extras are thrown in to appeal to my movie-geek side. I can even rip media from a DVD and freely convert it to any digital format I could ever want, in order to transfer to whatever video-playing gadgets I desire, and with no loss in quality other than what I dictate in the settings. And, I'm able to do this all from a physical medium that I only pay for once and for all, and that (barring accidents) will probably be around and viable longer than I will.

Can you say the same for any file on a hard disk, DRM'd or not? My oldest DVDs have outlasted something like five or six failed hard drives at this point, and I was a relatively late adopter of DVD.

Re:WTF?!?!

[hoggoth]

> the physical formats are a lot harder to destory. It doesn't take much to delete a digital copy.

You must not have kids.

About 50% of my physical DVDs have been destroyed beyond usability by my kids scratching them when inserted and removing them. I've paid the Disney tax more than once for the same material.
So far my kids haven't managed to damage a single bit of the movies on my file server.
Oh, and for those that say when the hard drive goes so does all your media, don't be an idiot. Make backups.

Re:WTF?!?!

[Anonymous Coward]

don't be an idiot. Make backups.

Same goes for your Disney DVDs. Duh much?

Re:WTF?!?!

[hoggoth]

>> don't be an idiot. Make backups.
> Same goes for your Disney DVDs. Duh much?

What do you think is on my file server now? Duh right back at'cha!

Re:WTF?!?!

[default luser]

What's wrong with making copies of the kid's DVDs?

Step 1: install DVDShrink.

Step 2: insert Disney DVD

Step 3: 20-cent DVD-R

Step 4: relax, and let your kids destroy yet another 20-cent disc.

You could even teach them to value the discs they break by refusing to replace the broken one for a week/month/year/decade. I wonder if they could learn the same value lessons from something as intangible as a fileserver?

Re:WTF?!?!

[Anonymous Coward]

You must not have kids.

Thank God.

I always use condoms, my girlfriends are on birth control, and I trained myself to not ejaculate (with an added bonus of multiple orgasms).

Re:WTF?!?!

[ben there...]

Can you say the same for any file on a hard disk, DRM'd or not? My oldest DVDs have outlasted something like five or six failed hard drives at this point, and I was a relatively late adopter of DVD.

As far as reliability/backups, digital files are actually a bit better than DVD. You can freely (without any decryption required) burn them to as many DVDs as you want (still encrypted). You can fit at least a couple per DVD because they use newer compression than MPEG-2.

It still leaves the issues of:
- Will the licensing company be around?
- Will you destroy your license store somehow?
- Will you have a modern player that still supports the encryption in the future?

But reliability/backups is not really a concern, unless you assume your hard drive will last forever and don't bother to burn anything.

2 bucks for a case?

[Fahrvergnuugen]

Doesn't it seem reasonable that a downloaded copy should be a little bit cheaper than a physical copy? I mean after all, when purchasing a downloadable copy of a movie you save the cost of:

• Stamping the disc
• Printing the cover & case insert
• Shipping the DVD through the distribution network
• Stocking the item
• Paying a clerk to check the item out

I'm sure there are more savings, those are just the few real obvious ones.

It sounds to me like the Tar*Mart's of the world are just being greedy.

Re:2 bucks for a case?

[Chanc_Gorkon]

They are being greedy and also focused on the one part that DVD's have....the movie. The only thing iTunes has that a DVD does is a inferior copy of the movie. When you buy DVD's, you get so much more. You get menus and other content you simply do not get on the download. You get making of clips and many things that some people do not like, but I personally think is worth the extra 2 bucks.

Its an issue with obsolenence

[Moby Cock]

I am becoming increasingly frustrated with big companies whining when technology renders their business model obsolete. If Wal-Mart and Target want to retail movies, then do it in the manner that consumers want. Whining that a competitor is better at it is just sad.

Good companies evolve and move to where the markets are, they don't cry about how they are so hard done by because a competitor has them beat.

Re:Its an issue with obsolenence

[sterno]

I'm sure they complained to the buggy whip manufacturers too. I think in the end though these are empty threats. The truth of the matter is that DVD's get people into the store. Getting somebody in to buy a single DVD leads to two or three or maybe a new DVD player or clothes or whatever else. It's like the milk in a grocery store.

Lest we forget, Walmart and Target both sell CD's in their stores still even though downloading music is a very established business. This is a negotiation tactic, trying to use their current market position to get a better deal out of the movie studios. If they can get the studios to drop the wholesale prices a $1, it would be a huge boost to the store profits.

Re:Its an issue with obsolenence

[Moby Cock]

I think what you say is true, and it sheds light on just how empty the threats by Target et al. are. They need to stock DVDs just as much as the studios need them too. By threatening to reduce 'shelf space' without a better deal is just bullshit posturing. The consumers don't really care who sells them DVD, they just want the content. If they have to get it online, well, so be it. And, as you say, this will hurt Target rather than the studio, since they won't be picking up other items in the store.

Re:Its an issue with obsolenence

[SnowDog74]

True but in the real world, ego stands in the way of sound business decisions. Men who wield power do so by applying their own version of the Reality Distortion Field to their otherwise commonplace ideas, regarding themselves as innovators for having re-invented the wheel for the umpteenth time.

The problem is that great ideas are hard to come by, and "insanely great" ideas are extremely rare... So, when a leaner, more agile company that operates according to this economy of scale comes along and tosses aside the "throw shit to the wall and see what sticks" business model, much to the befuddlement of many men who were utterly convinced that many mediocre ideas are more profitable than a few brilliant ones, they're very threatened.

They're not threatened monetarily... Bill Gates is still and will still be the richest man in the world. But he will never, and can never, be successful at the economy of scale that Steve Jobs has been... and, perhaps more importantly, he doesn't possess at all any of the brand image or personal image that Apple and Steve Jobs hold in the marketplace of ideas... and that has been a point of contention between the two for a very long time.

Most men, though they get older, do not get wiser... and this is why grown men in their 40s, 50s and beyond, running mega-corporations, continue to let their egos drive them down the abyss of terribly myopic business strategies.

Same reason RIAA and MPAA hurl lawyers at 12-year olds. Figuring out how to make brilliant movies is harder... much harder. Figuring out how to make a business case for their own companies when the internet renders recording companies and motion picture distributors unnecessary is simply beyond the capacity of these used car salesmen.

More than piracy, more than losing retailers, more than losing money, what frightens the modern corporate executive is the possibility of being unimportant.

Re:Its an issue with obsolenence

[Anonymous Coward]

The problem is that the average consumer (especially the ones that frequently shop at Target and Walmart) isn't likely to care. These consumers haven't asked for digital movie downloads. The industry is embracing it because they want to make pressed DVD's go away so that they can charge you the same amount of money while giving you LESS--thereby enabling them to make more money.

It's been established. The DVD's you buy from the store are different from the DVD's you buy online. You don't get the same high quality video/sound, and you most definitely don't get extras. The average consumer isn't going to see the difference because they DON'T have the equipment to notice.

If anything, the prices for downloads are too high for what you get. But that is the store's problem.

Re:Its an issue with obsolenence

[swillden]

Good companies evolve and move to where the markets are, they don't cry about how they are so hard done by because a competitor has them beat.

Smart companies evolve and move to where the markets are *while* crying about how they're being abused, in the hopes that it will slow down the movement enough that they can stay ahead of it.

Not saying it's "right", but it's reality.

Re:Its an issue with obsolenence

[Vokkyt]

If Wal-Mart and Target want to retail movies, then do it in the manner that consumers want. Whining that a competitor is better at it is just sad.

Except that they are already doing it in a way the consumer wants. No, really, they are. Most consumers do not want to watch a .avi or .mp4 file on their computer; they want a physical DVD to pop into the $20 DVD player they bought at Target/Wal-Mart the week before. This is what I really don't get in all of this; Target/Wal-mart and any other retailer in the business is not really going to lose a market share it that it didn't already have before. There may be a minor loss, but the fact is that they are talking about two completely different products and two completely different consumer mindsets. When I think about the digital download services vs the DVD format, I think about who would purchase which. Take my Dad, for example. He's a pretty tech savvy guy for his age, and though he isn't out there downloading movies off Bit Torrent, he does hate paying $20 for a movie with includes three different language options and subtitle options, 5.1 surround sound options, wide screen vs full screen options, and the gillion little extras that come on a DVD. When he heard that iTunes and other services were offering you a movie, plain and simple, he was all ears. He is the target consumer for digital download services. Consider my Mom; she isn't as tech savvy, and enjoys all the extra features that come on DVDs. In fact, it's part of the reason she buys DVDs. You think you could get her to watch a full movie on a computer screen? Hell no. Unless it was a media center PC, she has no interest in it, since it's too much work just to watch a movie. This is the difference in consumer that I think Target/Wal-mart fail to see, and what they don't understand when they complain about digital download services.

Though I agree that Target and Wal-Mart are being very childish in this manner, the fact is that capitalism has never been a fair playing field, and this is sort of what it's all about. The fact is that the digital download services offer almost completely different content; their target audience is different, the intended market is different. Instead of whining about under-cutting their sales, the DVD retailers should promote their strengths; extras, language options, no need to download, etc, while they start making their own movie service options. Take the time to build business plans now while other companies deal with a relatively new plan (in a sense...), wait until broadband is better able to handle the movie downloads (speeds mainly), and then jump right in with both a digital service and also a "just the movie" DVD service in stores. Watch as the playing field suddenly falls into the retailers' favor again, as they hold both markets once more.

Re:Its an issue with obsolenence

[balsy2001]

You still have a choice. It is the same one you always have. To buy or not to buy! If you don't like the prices (i.e., that movie isn't worth that much to you) keep your money and move along.

Re:Its an issue with obsolenence

[Jay Random the Other]

'It is true that the Amalgamated has lost business through my activities, but that is the natural result of my discovery, which has made their policies as obsolete as the bow and arrow. If an injunction is granted on that ground, I shall set up a coal-oil-lamp factory, and then ask for an injunction against the Edison and General Electric companies to forbid them to manufacture incandescent bulbs.'

-- Robert A. Heinlein, 'Life-Line' (1939)

Re:Its an issue with obsolenence

[tehcyder]

Bill Gates is still and will still be the richest man in the world. But he will never, and can never, be successful at the economy of scale that Steve Jobs has been

I do not think that phrase means what you think it means.

Re:Its an issue with obsolenence

[ben there...]

You think you could get her to watch a full movie on a computer screen? Hell no. Unless it was a media center PC, she has no interest in it, since it's too much work just to watch a movie. This is the difference in consumer that I think Target/Wal-mart fail to see, and what they don't understand when they complain about digital download services.

You're right, for now.

But the Unbox movies play on Xbox360 and the iTMS ones will play on iTV. It remains to be seen how quickly a box (other than a DVD player) connected to the TV for movies/episodes will work, but it will be a factor at some point.

Re:Its an issue with obsolenence

[SnowDog74]

It means precisely what I intended.

Re:Its an issue with obsolenence

[tehcyder]

My understanding is that economies of scale occur when (for example) a company's turnover grows by x% but its direct costs increase by less than x% because it can get a better bulk discount deal from a supplier.

As MS is larger than Apple, I don't see how the latter can have achieved greater economies of scale. It might be more efficient, but that's not the same thing.

Could it be?

[Penguinisto]

*gasp* - could it be the free market in motion working against the MPAA's money grab? COOL!

Man, I don't know whether I actually want to believe what I'm seeing or not...

Now if only they could put the same pressure on the RIAA...

/P

Re:Could it be?

[14CharUsername]

Walmart and Target are what's called monopsonistic buyers. Which is the exactly opposite of a free market.

In a free market the consumer has the power. This is negotiation between corporations. Whatever Walmart/Target and Disney/Apple finally agree to, the consumers just have to bend over and take it. The consumer has no say whatsoever in the price of anything here. That is not a free market.

Re:Could it be?

[Penguinisto]

Actually, it is, though not directly.

I grok what you're getting at as per the two retailers and the weight they carry, but I gotta be picky on something: WalMart and Target often (if not mostly) compete directly against each other, and against others, in any given city or town. By definition the term "monopoly" in any form would have a very hard time applying to either of them (esp. when you throw in other DVD-selling entities like KMart, ShopKo, BestBuy, and Circuit City, as well as regional big-box retailers like Venture (I think they're still around in the midwest US), et al).

I do think that this ultimately benefits the consumer, because the downward pressure on prices may indeed ripple outwards. After all, if the two biggies get a cut, KMart and Best Buy aren't going to sit idly by and just take it - they'll want a piece of the discounts too. This may (hopefully) put in place something that has been sorely lacking in this industry (and others like it)... actual competition for the consumer dollar. After all, WalMart and Target aren't demanding lower pricing because they're wanting to keep the movies for themselves, but because they want to better attract the consumer dollar for the movies that they want to retail in turn.

/P

Re:Could it be?

[14CharUsername]

A retailer is both a buyer and a seller. When selling goods there may be some competition (though that is dinimishing) but when they are buying its a whole other story. If you are a supplier and Walmart is selling a majority of your inventory, you are basically owned by Walmart, since if they decided to drop your product, you'll have to close up shop.

Now a monopsonistic buyer can cancel out the effects of a monopolistic supplier, but in this case the monopsonistic buyer is also a seller itself and that screws everything up. Given the power that these retailers have it is far more likely they will come to a deal with their suppliers to keep the prices high and share the profits. Furthermore, part of this deal will be to squeeze out any smaller retailers that aren't big enough to get to the negotiating table.

Whats happening here is that the big retailers see potential competition with this online video download stuff. They are using their buying power in one area (DVD sales) to squash potential competition from Apple.

The end result will not be that DVD prices will drop. Apple will have to offer iPod movies for sale at walmart and target. Apple will also be forced to raise the price of the downloads slightly and subsidize their sales to walmart and target so that walmart/target have the lowest prices.

A monopsonistic retailer doesn't lower prices. They just raise them for everyone else.

Re:Could it be?

[tehcyder]

Walmart and Target are what's called monopsonistic buyers. Which is the exactly opposite of a free market.

Yeah, they're both monopsonistic. Oh wait...

Which business are you in?

[tentimestwenty]

I don't know which business you are in but it must be large and you must have some power with your manufacturer. Most businesses have long since left private one-store retailers for the bigger chain stores, especially in terms of music, movies and computers. Any small store that tries to "drop" a product which is being sold lower online or to a bigger store just gets a curt "thank you" from the retailer.

Re:Which business are you in?

[Anonymous Coward]

Don't let him fool you... he owns a Head Shop.

Apples vs. Oranges: 640x480 movie file != DVD set

[mrfett]

why should these two products be priced equivalently? The retailers are looking for preferential treatment, not equal treatment. Download services are selling gimped products, not full multi-disc DVD collections. the two things are entirely different, and if anyone is being short-changed on price it's the download services. Why buy only the movie when for $2-4 more you can get all the extra content at higher quality?

WTF?

[stealie72]

OK, am I the only one who thinks that $12.99 for a magical digital-only copy isn't that great of a price?

For an extra $2, I get the discs with full-quality DVD video on them, and I can burn them in whatever format I want, and use them on any DVD-equiped TV. Not to mention a handy-dandy carrying case with some nice graphics from the movie on it.

Seriously, if ITMS was selling it for like $6, I could see retailers being pissed, but $12.99? Give me a break.

Re:WTF?

[Zadaz]

No, you're not the only one.

And don't don't forget all of the extras, languages, etc that aren't part of online efforts.

As I've said before, I would -love- to buy movies online. But they have got to make it worth it for me. These crippled, compressed wastes of bandwidth are worth a lot less than a DVD I can use as I please. (Well, not legally, but still.)

Re:WTF?

[TubeSteak]

OK, am I the only one who thinks that $12.99 for a magical digital-only copy isn't that great of a price?

Think about all the clueless computer users, for whom just burning a CD/DVD is a big deal that required note taking and step by step instructions.

Now consider that they do not have the ability to comprehend downloading a program like Gordian Knot and ripping/encoding their own DVD Rips, much less using whatever craptacular tool might come with their burning software.

$12.99 is a magical price, because it means they do not have to climb the (for them) intensely steep learning curve required to DIY. They aren't stupid in general, just with computers.

Target has the advantage

[sheldon]

If I had a choice...

$15 at Target
$13 at iTunes

$1 at the movie rental kiosk

I'm going with the movie rental kiosk, unless I want to keep the movie for a long time so I can watch it many times... I'll go with the DVD at Target. So I don't think Target has much to fear here as far as lost revenue.

I will say, that Apple's DRM is just a whee bit better than DivX, although not by much... Sheesh!

Make sure you deauthorize your computer before you upgrade your RAM, hard disk or other system components. If you do not deauthorize your computer before you upgrade these components, one computer may use multiple authorizations. If you find you have reached 5 authorizations due to system upgrades, you can reset your authorization count by clicking Deauthorize All in the Account Information screen. Note: You may only use this feature once per year. The Deauthorize All button will not appear if you have fewer than 5 authorized computers or if you have used this option within the last 12 months.

i don't get it..

[jspectre]

target and walmart aren't selling the same product. yes, it's the same movie. but one is a small, crappy-resolution download vs. a physical dvd, chock-full-of-extras, better video quality, that i can watch on most any dvd player i can put my hands on.

if nothing else, stores should be saying "don't buy that online-store inferior movie for $9.99, come buy our better product for $5 more!"

corporate greed is one thing, but stupid corprate greed is just stupid.

Re:i don't get it..

[IgnitusBoyone]

I have to agree.

People enjoy packaging if they didn't special edition's of DVD's would not sale. The movie industry should just tell them that if they do not want to carry there product then some one else will. Wal-Mart may sale 1 in 5 DVD's but people see DVD's in other places and if Wal-Mart stopped carrying Movies entirely then either downloads would go up or People would start buying them else where. I think given the nature of the product the store has more to fear from not carrying it then it does from worrying about some one distributing a lesser product at a lower price.

Wal-Mart has three options.
Ignore the issue and realize that itunes only allows you to do X amount with your DVD and the average person will not be happy with the service.
Acknowledge the issue and campaign against it.
If they fail to do either they will only hurt themselves. I would argue that most people come in to the electronics section of Wal-Mart not for TV's and DVD players, but for the DVD's CD's and other small things that the person needs day to day. You lose the selection less people will browse and less TV will be sold.

No reason to freak out

[businessnerd]

Wal-Mart and Target and stores like them should not be too worried at this point. At the moment, not many people are purchasing their movies via download. For most, downloading an entire DVD is an extremely time consuming process even with cable or dsl. The average broadband connection will take hours to download a full movie and all of its extras. Then on top of this, there is the "last ten feet" problem. For most consumers, they want to play it in their living room. Most consumers do not have a MythTV box with an NFS share to the desktop pc in the office, so they will want to burn the movie to a DVD to play on their DVD Player. For most, this may require more than one try, resulting in more than one coaster, and let's just hope that they burned the correct DVD format (DVD+R, DVD-R, etc.) to work on their player. Most consumers will still find it much easier to go to the store and pick up the DVD with all of it's packaging and not have to worry about all of the above. Instant gratification. Furthermore, they are probably going to be at Wal-Mart to pick up other products anyway, so it's no inconvenience to get to the store in the first place.

Regardless, the brick and mortars have no right to complain about the pricing difference. $2 is not significant and is actually a pretty good deal when you consider how much cheaper it is to distribute a digital copy over the internet compared to producing disks with packaging etc, plus the stores distribution overhead.

Online movies less valuable to the consumer

[interiot]

And online movies are less valuable to the consumer. Consider:

• They don't get the box art
• The video download is almost certainly much more compressed than the DVD version

If there's a difference in value to the consumer, it only makes sense that there would be a (small) difference in price.

Re:Online movies less valuable to the consumer

[Anonymous Coward]

You forgot the main one, the downloaded file does not create a disk that can be played on any DVD playback device. Unless these files can be used on regular consumer DVD players connected to TVs or portable players, they'll only be bought by a niche market.

Re:Online movies less valuable to the consumer

[nutshell42]

• You have to pay for the transfer (even if you don't pay per GB your ISP nevertheless will get their money back somehow)
• You have to pay for disk space and a backup medium
• You take the risk of the online store going belly up and "your" movie collection becoming suddenly useless
• DRM makes sure you can only watch the movies on your PC, postage stamp size, without pausing, no more than 3 times a month, only the week before a full moon.

I won't "buy" (acquire limited usage rights as granted by the copyright holder subject to change without notice) a movie online unless they either get a *lot* cheaper than the DVD or they rethink the whole DRM PoS

Re:Online movies less valuable to the consumer

[norminator]

Considering the fact that most online movie sellers don't allow you to burn your movie to DVD, and are very limiting on how or whether you can play that movie on other computers, or on TVs, I'd say you've overestimated the value of online movies.

With Apple's set-top box, that'll change a little bit for their store, since you'll be able to stream movies to your TV, but that's still a huge pain, considering you'll need a $300 box per TV to be able to do that. And considering there's still no other way to get the video to a TV (other than an iPod with the video out), and you still can't burn it to a disc. Amazon's service is even more difficult to work with.

Re:Online movies less valuable to the consumer

[porcupine8]

Don't forget all the extras most DVDs come with. If you actually like watching the deleted scenes, outtakes, etc etc, that can add a lot of value to the disc that you don't get just d/ling the movie itself.

Re:Online movies less valuable to the consumer

[rahrens]

No, it won't cost $300 per TV to stream movies to your TV. That's only if you want the convenient controls the iTV (or whatever they'll call it) will give you. You can connect most Macs to your TV now, you just have to control the playback from the Mac, not a nice remote from your couch.

Of course, that connection is easy only if you have a notebook - desktops are not always within easy cabling distance of the TV. I know that, but you made a blanket statement that isn't necessarily slways true...

The disk issue will always be with us, but, frankly, as this business model develops, and the set top boxes mature, too, it will be less and less of a problem.

As the bandwidth to the typical home widens, the quality the ITS (and other online stores) will be able to provide will increase, and this business model will mature rapidly. I think physical disks will slowly fade in use over time. Especially if manufacturers develop small portable players like the iPod that can take that content outside the home and away from your home theater to allow you to share content under controlled conditions.

Even now, occasionally albums on the ITS will have pdf formatted files with additional content such as artwork, artist interviews, and even interactive quicktime based content that rivals what you can get with a special edition Cd in a B&M store. It is downloaded at the same time as the CD. So the 'extra' content CAN be provided, if the artist/studio wants to do so.

Re:Online movies less valuable to the consumer

[ben there...]

DRM makes sure you can only watch the movies on your PC, postage stamp size, without pausing, no more than 3 times a month, only the week before a full moon.

I know you were kidding, but FYI you can watch the Unbox movies on an Xbox360 + TV.

Class play

[suv4x4]

Class business play in 6 acts:

1. "we threaten to reduce shelf space for DVD-s" -> they don't know of online offers will decrease DVD sales, but they add few numbers and decide it's plausible, therefore worthy of protection

2. let's say Hollywood proceeds with undercutting them online

3. retailers reduce shelf space: as a result from this, DVD sales decrease. Retailers say: "you see? you're ruining out business"

4. Hollywood increases online prices to match DVD's in fear not to lose from DVD sales

5. People refuse to buy vaporware DRM-ed download for the cost of a DVD and online sales wane

6. Aftergame: retailers are happy they eliminated the competition (online), Hollywood is happy they kept their DVD sales (not that they'll stop bitching about otherwise), customers: screwed.

Re:Class play

[LMacG]

3.5 RIAA says "DVD Sales are decreasing, it must be those darned P2P Pirates!!" ... because when has logic stopped them before?

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[sakasune]

Why buy only the movie when for $2-4 more you can get all the extra content at higher quality?

But you're telling me I have to actually leave my room (parent's basement) and drive to a store and purchase a physical copy of something? Bah!

The wrong approach for Walmart

[sjonke]

All Walmart has to do is go with the model they've proven viable time and time again: switch to sweatshop and/or child-labor-produced DVDs, reduce staff salary's and benefits and eliminate needless training.

Uh, sorry...

[Kantara]

But Target and Wal-Mart needs to RTFP. Apple's pricing is as follows:

$9.99 - Library purchase
$12.99 - Pre-release and new releases for the first week
$14.99 - After one week as a new release and before it becomes a library purchase (Take a look at Annapolis - $14.99. It was $12.99 the first week Apple started to sell videos)

So, Apple gets one week where they are $2 cheaper before Target matches and Wal-Mart undercuts their pricing. They are just complaining that they have new competition.

Re:Uh, sorry...

[sottitron]

Hmm... $2.00 discount for the first week. Sure sounds like the tried and true CD/DVD distrobution scheme to me.

This just makes me want to stop shopping at Target

[sottitron]

I expected this from Walmart, but Target? By the way, what about the DVDs that are $7.50. As a consumer I should be complaining that I can't download that from iTunes for $5.50. PLUS, its not like my broadband connection is free. Even forgetting the DRM, I liken the *SLIGHT* discount I would get if I cared to purchase The Little Mermaid as a bonus similar to the bonus I get from my Costco membership... Only broadband costs 3-4X more a year than Costco...

I could see their point except for a few things

[sokoban]

First of all, DVD media and downloadable iTunes movie content are not in the same market really. DVDs are made to be played on DVD players and have much higher resolution, but cannot be ripped and put on an iPod or other portable video player (yeah, I know. it is possible, but impractical for most people). Conversely, movies downloaded from the iTMS are of a significantly lower resolution than a DVD, cannot easily be played on a DVD player, and lack special features common on DVDs, but you can play them on a portable video player. Big box stores are assuming that people who buy a DVD will not buy a movie download and vice-versa. This doesn't seem correct really. If somebody wants to play their digital download on a real screen, they will still pretty much have to buy a DVD. Also, if somebody wants to watch a video on their portable device, they pretty much have to buy the digital download. People will buy both if they want to, but I'm sure if ripping DVDs was made easier there would be little to no effect on DVD sales by allowing digital downloads. Those who want to buy a DVD will not be dissuaded from doing so by the availability of a digital download, nor will those who only buy a download have been likely to buy a DVD in the first place.

Offer the retailers DVDs on a spindle

[MDMurphy]

First, the difference in prices suck and the retailers should be happy they're not reallying being undercut. I get 2 audiobooks a month from Audible.com. Heavy on the DRM, but they work great for listening on the ipod. I pay $10 each for those two books. Retail, to buy the 10-15 CDs they are usually sold on cost $40-60 each. Big savings and the downloaded version is actually more convenient that the CDs.

If the retailers want to sell "the same thing" let them buy the pre-recorded DVDs on a spingle. No box, no sleeve, no art work. They're free to put up a fancy kiosk showing a preview and put cheap paper sleeves next to them for people to bag their own just like buying apples. I bet that could retail for $2 less.

DRM'd, lower quality movies that take a long time to download are no threat to DVD sales. People who have the computer and internet connection to download and watch these movies also have the bits necessary to rent a DVD for $1 and copy it on a $.50 blank disc. So people who want the absolute lowest price aren't downloading they're renting. So let them rant and rave, but they'll still sell DVDs. Even if it did undercut sales of people coming into the store to buy only the DVD, there are a lot of other people who buy something else while there, or just get the DVD as long as they were there for something else.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[gEvil (beta)]

Why buy only the movie when for $2-4 more you can get all the extra content at higher quality?

But Daaaadddd...I wanna watch it nooooowwwwwwwwwww!!!

Target and Walmart CEOs should join Disney's Board

[sottitron]

Seems like all the Walmart and Target CEOs need to do is produce an animation studio that puts Disney's to shame and join the Disney Board and become the largest shareholders at Disney in the impending purchase of said animation studios. Sheesh. They act like it would be so hard!

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[FlyByPC]

No,no, no -- that's what NetFlix / Blockbuster are for.
(That, and your trusty DVD+-R...)

And the point is?

[frovingslosh]

The two-disc rerelease of Disney's 'The Little Mermaid' now retails for $14.87 at Wal-Mart and $14.99 at Target. The movie can be bought for $12.99 on iTunes.

So for $14.87 you can get 2 already made discs at Walmart, in a nice storage case, with plenty of extra bonus material, that will play on any (region 1) DVD player, or for less than 2 dollars less you can spend your own bandwidth to deliver a copy to you, and provide your own packaging and media, that contains only the movie, is of a much poorer quality, has a DRM infestation that will keep you from using it where you want to use it, and eventually you will not be able to play back on the system you want to play it back on. If you buy the Wal-Mart version you ratain right of first sale and you are free to resell it if you want, or lend it to friends, or even give it away. If you have the downloaded version you can't legally do any of these. And somehow Wal-mart wants to claim that this alternate outlet puts them at a disadvantage? I'm sure they would like to have a complete monopoly of distribution, but any argument that cheaper on-line sales unjustly undercuts them is completely bogus, and if anything it might even improve their sales when the on-line mark realizes what a bad purchase they made. It certainly makes the Wal-mart price for a couple of mass produced and packaged discs look like a great deal in comparison to on-line pricing.

Can't compare online to hard media

[dschuetz]

The "hard media" DVDs *should* be more expensive than softcopy-only versions of a movie. The versions sold over iTunes (to my knowlege, I've not actually bought one) only have the movie itself, at a lesser resolution, and none of the special features, extras, secondary language tracks, etc.

That said, I think that the online copies ought to be even cheaper (high price of $10, and maybe $7.50 for "older" titles, $5.00 for "classics"), for just that reason.

This will definitely be interesting to watch, to see how it all shakes out. I think that Apple will win out in the end, but that it won't make a significant dent in physical DVD sales. Even if Apple manages to become the #1 vendor for movies over Wal-Mart, Target, Best Buy, etc., there are still LOTS of physical copies being sold through those other vendors. No way they ever account for more than 50% of "movie" sales (and probably will top out much less than that, but what do I know), unless and until they are able to sell the entire DVD contents (features, etc.), at DVD resolutions.

Wouldn't buy a movie as download anyway...

[AceCaseOR]

Frankly, when I buy a DVD, I generally want the special features, as well as the convience of being able to watch it on my TV. As I don't have a Media Center PC, I don't get that covenience with pay-to-download movie services. I also don't get the bonus features from any of those services. Until iTunes or Amazon's service can satisfy my demands for those, I'll stick with the physical disks, thankyouverymuch.

Studios Win Again

[mpapet]

The studios controlling the distribution of these films are the big winners again.

Retail DVD costs: Media, replication, packaging, distribution, slotting fees, spoils and other logistics problems, and varying amounts of advertising. Throw in the loss of control of the DVD content. That's your priviledge to make and keep personal copies, freedom to play the movie when and where you want. Don't forget the graft required to get stuff on the shelves of your average big box retailer, loss of control of the distribution channel once it hits the retailer's dock and a million other tiny headaches.

Retail Download: Zero duplication costs, nominal distribution costs, advertising. *Total* control of distribution, ability to control when and where the consumer can play the content. (windows media player 11 has this feature) Beyond that granular control of the rights conferred upon the consumer through DRM.

Consumers are willing and happy to trade their freedom for $2. The studio pocket millions of extra dollars.

For every j@ck@ss that thinks this is the "free market" at work, will they please explain where the innovation is in this model? How is the consumer market for movies -more- competitive as a result? I can't see how consumers benefit in an industry controlled by an oligopoly.

Re:Studios Win Again

[Dinny]

The market works like this. The movie studios have a monopoly on the their individual movies. They abuse this monopoly to over charge retailers and consumers for DVDs. The studios open a new channel and use incentive pricing to help bring it to life. The very large and very powerful retailers see this as an opertunity to attack the monopolies that are making profits that the retailers could be making instead.

This is an effort by Walmart and Target to lower the price of DVDs even farther then they already have to increase the volume that they sell. This is two groups that are far to large and powerful to operate smoothly in a free market fighting for territory. It's a lot better for the consumer then for these two groups to get along.

Re:Studios Win Again

[llZENll]

No one is forcing you to buy movies, if you don't like how they are distributed or how much they charge, then don't buy any. Instead of bitching start your own movie studio and sell your movies for $1 each, chances are you are not going to last long.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[Qzukk]

Sure thing son, here you go!

Buffering 0.0001%...

$2??

[misleb]

I'd be more than willing to pay an extra $2 for the convenience of packaging and burning to disc. I mean, I'd probably do it anyway myself if I downloaded it. The blank media itself nearly takes up that $2. I say a $2 difference isn't enough to make the download time, time burning, and media worth it. The brick and mortar stores are actually getting a pretty good deal.

Although I don't find myself buying movies at brick and mortar stores. If I'm really going to buy a movie (pretty rare) I'll just order it from Amazon or something. Usually it is for a gift. I don't see much point in owning movies except for the few really great ones that you might actually watch more than once or twice. But even then, repeat viewing loses its appeal as I get older.

-matthew

Re:$2??

[teg]

I'd be more than willing to pay an extra $2 for the convenience of packaging and burning to disc. I mean, I'd probably do it anyway myself if I downloaded it. The blank media itself nearly takes up that $2. I say a $2 difference isn't enough to make the download time, time burning, and media worth it

You would if you could, but you can't - that's one of the reasons 12.99 is a pretty bad deal. You can play it on a computer, and that's about it.

... and the choir shouts Hallelujah!

[FellowConspirator]

Seriously. The $12.99 you pay for the video download thorough iTunes is a rip-off. The video resolution and quality is inferior, you don't get the extras, you don't even get to burn it to a DVD so the kids in slap it in the DVD player in the car/living room. People are paying a little (20% less) because they are getting MUCH less (1.4G of movie versus 18G of movie -- can't play on standard equipment).

I'm not saying that $15 is a fair price for a DVD either. It costs the manufacturer, last I heard, about $2.50 for the DVD and packaging (including the DVD production costs, discounting the original film production cost which is, on average, fully recouped during its theater run).

Heck, if net-neutrality really disappears, the cost of the iTunes download may skyrocket. I can't blame Target and Walmart for trying though. It's all about putting the squeeze on the vendors.

Re:... and the choir shouts Hallelujah!

[misleb]

People are paying a little (20% less) because they are getting MUCH less (1.4G of movie versus 18G of movie -- can't play on standard equipment).

18G of movie (HD-DVD/Blu-Ray) can't play on "standard equipment" either. :-p

-matthew

Re:... and the choir shouts Hallelujah!

[FellowConspirator]

2 DVD9s (what you get in the package from Target, 2x9G=18G) do play on standard equipment. The iTunes download, however, will not.

Re:... and the choir shouts Hallelujah!

[jedidiah]

Sure it can. While the encryption on HD DVD's may not yet be broken, they are at least open standards meant to be used by a variety of manufacturers.

Compared to the "only Apple Corp and no one else" nature of iTunes, it's almost GNU.

There WILL eventually be an in dash HD-DVD or BlueRay DVD player for my car just like there's an in-dash old style DVD player in there already.

No such "iTunes" device exists. At best, some car stereos offer "integration" with the only vendor's devices.

Re:... and the choir shouts Hallelujah!

[ObiWanKenblowme]

Unless you plug one end of an AV cable into the iPod and the other end into a TV. Then it will play on standard equipment.

Re:... and the choir shouts Hallelujah!

[ben there...]

...because they are getting MUCH less (1.4G of movie versus 18G of movie

DVDs are at maximum 8.5 GB. Most "Main Title" files on a DVD are on average 5-6 GB. Older DVDs or flip-disc WS/FS format DVDs may be less than 4.7 GB total for a single format. Your point still remains, but 18 GB is not accurate.

it makes sense...

[CaptainRiot]

it just makes sense that if you're buying it from an online download place like iTunes that you should have to pay less

Not Fair...

[Warlock7]

It's simply not fair that when you download a film that you don't get the extras, a disc and all that wonderful packaging. It's also not fair that the quality of the downloaded content isn't as good as a full DVD of the same film. Apple should be forced to include all of these features so that there are equivalent items being bought by the consumer.

Then, maybe, just maybe, Target and Wal-Mart will actually have an argument.

Heh Heh

[drinkypoo]

Target has sent a letter warning 'that Target might have to reconsider the amount of shelf space allocated for movies if studios undercut the wholesale price of DVDs by giving online services a better deal on digital offerings

Studios sent a letter back saying "Wal-mart sells enough discs for two target chains put together, and then some, so we don't need you. don't let the door hit your ass on the way out. By the way, your business model is doomed, suckers." Enclosed was an audio CD containing 74 minutes of laughter.

Homer says it all...

[misleb]

Moe: This baby can flash-fry a buffalo in 40 seconds!
Homer: 40 seconds? Oooo, but I want it now!

iTunes Video Resolution

[norminator]

movies downloaded from the iTMS are of a significantly lower resolution than a DVD

You do know that their video is 640x480 now, don't you? I realize it's not 720x480, but for a standard 4:3 video, it's basically the same thing. I could understand the point if they were still doing 320x240. Of course, just because the resolution is basically the same as broadcast NTSC, doesn't mean the quality is the same. I do realize that the quality of the iTunes downloads is not likely to be as high as a 4:3 DVD. (I haven't had a chance to really get a look at the 640x480 videos from iTMS.) I just think it's weird to see people complaining about the resolution.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[jedidiah]

Nah... just go to Frys.com and have them ship you that 2TB consumer storage array they sell.

Equipment Costs

[norminator]

So for $14.87 you can get 2 already made discs at Walmart, in a nice storage case, with plenty of extra bonus material, that will play on any (region 1) DVD player...

Don't forget the fact that those region 1 DVD players can be had for $30, instead of having to pay $500 for a computer (or more for a Mac), plus $250 - $350 for the convenience of having an iPod to carry the movies around on, plus $300 for the Apple iTV set-top box to actually be able to watch the movies on your TV. I know that most people have a computer already, and a lot of people already have iPods for music, but really the cost of watching iTunes movies is quite a bit higher than the cost of watching DVDs when you take all of the requred equipment into account.

Until iTunes Movies can be Burned...

[w0lver]

The retail channel has nothing to be worried about. I still need to buy a copy so my kid can watch the movie on his DVD player in the car.
Other factors help too, the HD formats, extras only available on DVD, desire to own the physical...
CDs have not disappeared and the DVD has a stronger value proposition going forward; these are just threats to negotiate more of a margin for retail...

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[sakasune]

No,no, no -- that's what NetFlix / Blockbuster are for.

Yeah, but the mailbox is still outside...

No DVD extras with iTunes movies

[dorzak]

Of course there isn't all the extra scenes, games, etc that are you the physical DVD when you download from iTunes.

Re:No DVD extras with iTunes movies

[Beardo the Bearded]

Do they still have the ads for other movies, ads for products, and the warnings that you should always buy your DVDs because they want you to?

Those are extra I could certainly do without.

We're forgetting something here.

[Gothic_Walrus]

I wasn't surprised to come here and see the "Physical copy with better quality and extras = WIN" argument posted, over and over and over. Unless I've missed it, though, the people making the argument are missing a key point...

Most people don't know or care about the differences between digital media and the physical DVD.

The retailers have already figured out through the music poriton of the iTunes store that, for millions of people, the difference in quality, flexibility, and future usability doesn't matter enough to justify getting the physical version instead of paying for the (often cheaper and easier) download. And if it can meet the needs of the person who bought it, why complain? After all, if all they want is for it to play on their iPod now, why not download it?

Not that this is anything new, mind you, and I'm not saying that I disagree with the users here...it just always amazes me how many are shocked and awed by the fact that anyone would even CONSIDER downloading that DRMed piece of "crap."

Re:We're forgetting something here.

[Anonymous Coward]

I buy from iTunes a lot. It is worth it to me to pay $1.99 for commercial-free episodes of TV shows I like (Project Runway, Battelstar Galactica, Lost) which look great on my (non-HD) TV played through my iPod media dock.

It is not worth it to me to buy iTunes movies, when for $2 more I can get the DVD and rip it myself using Handbrake and then iPod it all I like.

DRM may be ideologically painful to many, but frankly, the Apple license and pricing for television shows is, IMHO, more than fair. The no-commercials is worth it by itself.

If users care, they know and are willing to compromise. If they don't know, they probably don't care. I know and care. My wife doesn't care at all - she just wants her commercial free TV to view at her liesure.

And she just bought the Little Mermaid 'special edition' for $14.99...

Re:We're forgetting something here.

[scooter.higher]

Actually there is a big difference between buying movies and music from iTMS. If we had the same flexibility with movies downloads as we do with music downloads, brick and mortar stores may see a decline in the sales of DVDs.

As it is now, I can buy music from iTMS, then play it from my computer, copy it to my iPod, or even burn a CD, which I can then play in my car, or let my kid borrow to play in his CD player.

If I buy a movie from iTMS, I can watch it on the computer or from my iPod (ignoring the possibilities of HTPCs for the average person).

After that factor in the lack of special features, deleted scenes, blooper, outtakes, behind-the-scenes, etc that you don't get from iTMS

I have to believe that most people do know this, and do care.

If anything, we should all be complaining to Apple and Amazon that we don get a downloadable package of the special features, since the cost is nearly the same. Of course cost vs. convenience goes a long way... just look at the price of milk at 7-11 vs. a grocery store.

You damned felon - rat out your source!

[Overzeetop]

Oh, sure, your might consider it fair use to burn them in any format you want, but those discs are encrypted.

So, either you need to demonstrate that you can code an entire decryption and storage program for transferring those movies, or we just might need to have you talk to Bruno about where you acquired your illegal decryption software. You see, it's legal for you to do this on your own, but nobody is allowed to help you, by law.

Isn't modern government swell! [/sarcasm]

BTW - I think the digital movie-only version should be on par with a typical 1 or 2 night rental fee; maybe less if it can't be burned to a playable DVD. I'd still buy the physical version (and, hey, I did!) because it comes with the packaging (which I promptly store and never look at again) and the extras (which I might look at on one in five discs I get). More importantly, it means I've got a copy I can _resell_ if I decide I don't want it anymore. $14.99 paid less $8 recovered on ebay when I'm tired of it = $7 net value. Take away the values of the extras and I'd say iTunes is about $6-8 overpriced.

IMO, Target is just looking for leverage. It's a game retailers play all the time. Not really news, unless you take the point that the online version is, indeed, an inferior version and the studios are about to admit that fact.

Yes, Apple does the same thing, ...

[AHumbleOpinion]

The iTunes Music Store's business model is to pressure manufacturers to drastically cut production costs, ...

Given the iTMS goal of selling iPods, the yes. Apple does that with iPods.

... undercut prices offered by smaller businesses, ...

iTMS does that directly, it is not a profit center itself as it is a marketing vehicle for iPod. Hence the 0.99 price, and low margins. Operating at or slightly over cost.

... and compensate employees as little as possible? That's news to me.

iTMS does that indirectly. Apple does that with iPods. Did you miss the outsourcing and sweatshop articles? Now I am not saying that Apple knowingly operated sweatshops but when you outsource you take that risk. It is sadly necessary for a corporation to have its own people on-site to monitor compliance with local laws and contractual worker treatment agreements.

I thought it was to provide content for the sale of iPods and Macs. Silly me.

Yes, your post was silly. If you put the koolaid down and dig a little deaper ...

The trouble with this is...

[Anonymous Coward]

First of all, is shipping free? No. So the customer isn't really getting it for cheaper than you , are they.

Second... eventually online shopping will eclipse brick & mortar,... so enjoy your little "power trip" while you can. Eventually sellers won't mind you dropping their product at all.

Re:Yes, Apple does the same thing, ...

[GalacticCmdr]

The iTunes Music Store's business model is to pressure manufacturers to drastically cut production costs, ... Given the iTMS goal of selling iPods, the yes. Apple does that with iPods. ... undercut prices offered by smaller businesses, ... iTMS does that directly, it is not a profit center itself as it is a marketing vehicle for iPod. Hence the 0.99 price, and low margins. Operating at or slightly over cost.

In other words is the Microsoft Business Model, the IBM model, the model of all companies that dominate any space. Wal-Mart and Target used to dominate the physical DVD sales space and drove down prices across the board - they thought that they dominated DVD sales. Well, now they are getting their turn in the pickle barrel as people are equating physical ownership with electronic ownership. Thus they will either have to adapt or adjust their model.

I am fine with iTMS driving down the price of physical DVDs as I was with the big boxes driving down the price of personal goods. I both suffer and benefit from it. It is just funny to watch these companies whining the same whine that the smaller stores whined when the big boxes first rose up.

Not practical to kiss them off yet.

[Kadin2048]

If I were the movie studio, I'd call this bluff.

In another few years, the movie studios could do just that.

But right now, B&M DVD sales are too much a part of their revenue stream to allow them to just walk away from it. Just think, if some movie studio said "no problem, we'll just sell exclusively through iTunes," how many consumers would see their movies? Not too many -- it's still only a small percentage of consumers who buy music online, and even fewer who buy movies online.

The B&M stores are going to use their clout in the market to try and keep out online distribution -- which they know because of its low costs will eventually be their demise -- as long as possible. Right now they can still do that. In a few years, probably not.

Re:Not practical to kiss them off yet.

[nine-times]

I'm not saying get rid of B&M, I'm saying if Wallmart won't sell DVDs anymore, you'll still have Best Buy, various record stores, Amazon, Blockbuster, and loads of other ways for people to buy normal DVDs. I don't think Wallmart will actually drop DVDs, though, because they get their strength from the idea that you can buy ANYTHING at Wallmart. I think they're bluffing.

Of course, I'm not expert, and you could accuse me of underestimating Wallmart's stranglehold on distribution channels.

Lack of Format Flexibility

[Bones3D_mac]

In addition to the stuff already mentioned (box art, compression, a physical disc, etc...), you also can't burn these files onto a disc that can be played on a standard dvd player. So unless you buy a proprietary device to connect to your TV, you're stuck in front of the computer (or your iPod, if you were so inclined) if you want to use these files.

These retailers are all being ridiculous. The costs of manufacturing, packaging and shipping these movies to them in a physical form should more than justify the $2 to $3 difference. Until there is a system in place where online distributed movies can be burned directly to a standard DVD by the end user, the retailers are going to just have to deal with it or stop carrying movies completely.

In some sense though, it does make me wonder if the movie industry wants to kill off DVDs in favor of online distribution. It's far cheaper for them to copy data onto a computer than it is to make physical discs, and, they will then have much more control over what the end user can/can't do with the content.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[Aladrin]

Not if you can get your parents to bring the mail to you.

Oh really, now

[burntsigil]

Target might have to reconsider the amount of shelf space allocated for movies if studios undercut the wholesale price of DVDs by giving online services a better deal on digital offerings.

And consumers might have to reconsider the amount of capital allocated for purchasing movies at Target.

Re:Oh really, now

[JasonTik]

And consumers might have to reconsider the amount of capital allocated for purchasing movies at Target.

But they won't.

Re:Oh really, now

[burntsigil]

That all depends. If people can't find the movies they want at Target, they'll look elsewhere. If it happens enough, Target will cease to be the first place they check when they need a movie. They'll go to whoever has the best selection.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[RosenSama]

Maybe 640x480 and no extra content is just fine for most consumers. Then why not save 15%+

Idiots

[kahrytan]

Retailers are morons. They see iTunes, Amazon.com movie download, movielink as threats. They don't sell DVD Quality movies but poor quality movies. And only play on the computer or portables. I won't be buying any movie online until I can download entire DVD iso.

Absolutely they want to kill off DVDs.

[CyberLord Seven]

For the last year or two I am suddenly seeing very marginal movies in Best Buy. Some of it is in collections where you get fifty movies for twenty to thirty bucks. A larger portion of it is in small movies that haven't been available in the past, and/or collections of unpopular movies bundled two or three together.

Notice also, that Disney and Lucas are suddenly releasing a lot of material on DVD.

I think the studios are ready to bet big on Blu-Ray or HD-DVD to supplant DVD and are getting what they can from the DVD cash cow before it goes belly up.

I don't agree with them. I have a large screen, HD TV with surround sound, and I have no interest in either format. Still I think they have a lot of faith in HD formats going forward.

Re:Absolutely they want to kill off DVDs.

[Bones3D_mac]

I'm not so sure this is the case here. I think it's more along the lines of eliminating any product that can be physically transferred or sold. Once you have data files that are tied specifically to you, you can't transfer them to a third party after-market, even if you want to sell them outright. To transfer such files, you'd have to hand over not only the files, but the computer authorized to play them, as well as the accounts to the services you downloaded them from.

Since the "powers that be" know most users won't go to that extreme to transfer their ownership of a data file to a third party, they'll use it to force anyone who wants access to these kinds of files to buy directly from one of their "approved" distributors only.

This is actually similar to the business model that the infinium Phantom game console was supposed to use. Had it been released, the console would have only allowed you to purchase games from a centralized server and then download them directly to the console's hard drive. Since the console and the data stored on it would be directly tied to you, you would not be able to transfer ownership of the console to a third party *and* keep the data intact, unless you handed over your account on whatever server the games were stored on. (Most likely, handing over such an account would also include handing over sensitive information like your credit card numbers, as well.)

Re:Stop Bitching

[Anonymous Coward]

I'm definitely not the entertainment industry conglomerates best customer. Part of that is intentional, per your rant.

Yes, indeed start my own movie studio. Now -that's- the solution that breaks the distribution cartel.

You clearly fail to understand the role of a movie studio in the distribution of a movie/video/whatever.

sounds right

[devhen]

$14.99 hard copy, $12.99 digital copy.. sounds just right to me.

I don't need the box art.

[jotaeleemeese]

And video quality may be enough in many circumstances.

Most movies are watched only once or twice, to know that nothing is left behind after the watching is done would be a relief in many cases.

Re:I don't need the box art.

[ElleyKitten]

I don't need the box art. And video quality may be enough in many circumstances. Most movies are watched only once or twice, to know that nothing is left behind after the watching is done would be a relief in many cases.

Then wouldn't you be happy if your movie download cost less than my special edition boxed set?

If one explains in plain english how to do it....

[jotaeleemeese]

... and he codes it, I don't think there would be any problem.

Re:If one explains in plain english how to do it..

[beeblebrox]

How about if someone sings it?

Give Wal-Mart a different "movie" to sell.

[malejko]

Walmart will do anything to drop their prices, and yet they don't care that ITMS is selling an inferior product. All they see is "ITMS is selling the same movie we are for a few bucks less!"... short-sighted morons...

Everything else (within reason) that Wal-Mart / Target sells is inferior (Apex DVD players - wtf? I guess there ARE people that like to buy a shiny new DVD player every six months), so why not give them another option:

Put a Disc in an envelope (like NetFlix or Zip.ca), with no bonus features, no deleted scenes or anything, a scaled-down quality (so it fits on a single layer and is cheaper to make) with stereo audio, and no artwork on it (other than maybe the envelope to 'sell' it), and then offer that @ Wal-Mart / Target for $10. Then they will technically have a better product than ITMS ('cuz you can bring the DVD to your friends house and play it in their DVD player too!), and will have it for the same price!

The rest of us geeks (those with a brain at least) will continue to go for higher quality movies, even if we have to pay more.

Re:Give Wal-Mart a different "movie" to sell.

[fuyu-no-neko]

Nah, give them the exact same deal.
Give them a single copy of the same video file that has been given to the download stores. Then require them to spend money on putting the equipment in place to distribute said file, applying the DRM to the file as necessary. Then make them pay for every time someone uses the service. The system I'm envisaging is one where a customer can walk in with a USB key, plug it in, buy the movie, and have it transfered to their key.
Now Wal-Mart/Target are getting the same deal as the download stores. They've been required to spend money on technology and equipment in order to offer the same product as the download stores. And guess what, they're not making any money from it. All because a couple of meters away there's the full product (with none of the messing around) for a couple of dollars more.

Its not the same product!

[Orig_Club_Soda]

its way lower resolution and it cant be burned to DVD and it doesnt have packaging. The package item should cost more because you get more.

You're not his target market

[anomaly]

Today I went to a restaurant for lunch. I bought a soda for $1.59. I could have bought that soda for as little as $0.25 - was the restaurant screwing me? No! They provided a cold beverage where, when and how I wanted it. For that service, I willingly paid a significant upcharge. You might pick to take your own cold can of soda to the restaurant, but I choose not to.

What he's saying is that he provides a service to his customers. In general, they want it to "just work" and look to his team to provide a comprehensive system that does that. When they see the itemized list, they feel like the TV is a commodity and are getting screwed. They don't know that the "model D" of that TV system includes a different interface, or is not compatible with components X, Y, and Z. Whether he charges them more as a part of the TV price, or as a separate charge in the services is irrelevant, but it would be kind of Panasonic to let him know that they offer wholesale prices to the general public over the web.

Re:If one explains in plain english how to do it..

[Overzeetop]

Wouldn't that be traffiking in circumvention? Either way, he would have to code it and use his version. He can't just switch to, say, DVDdecrypter (which is what I use, btw) after making a "sample" code. Besides, just coding up a working decrypter probably isn't enough. I suspect a front and back end app with a blank decryption module might be considered unlawful. It certainly would if he were a terrorist ;-)

I'd like to say that I decrypt all my discs with downloaded freeware as a show of civil disobedience, but (a) I don't have the HD space for all of them just yet and (b) I mostly do it to make working discs so my 4 year old doesn't bust the originals. The (c) part is so I can loan discs to friends/family without actually loaning my original. I don't even like to handle them myself, as it seems I can scratch a disc just by looking at it wrong. Some of my CDs are just awful.

Why worry Walmart?

[Anonymous Coward]

Movies on iTunes are a ripoff - just like everything else that Apple sells.

Re:Apples vs. Oranges: 640x480 movie file != DVD s

[Firehed]

Having worked in a video store for about a year, I'll confirm that this is exactly the case. Most rentals (I'd say 60% or so, and consider a good 5-10% were still VHS) were fullscreen movies, which are indeed 640x480. And more often than not, the second disc of two-disc sets goes untouched (it's obvious because it's not covered in fingerprints and scratches, which you think wouldn't be hard to avoid after, what, two decades of optical media), indicating that people don't give a shit about the extras. As to widescreen versus fullscreen... well, people have some stupid notion that the top and bottom of a fullscreen get chopped off to make the widescreen version. Which makes perfect sense, after all - let's remove the content in order to make it so movies don't fit any of the existing hundred million TVs properly. I personally don't care about the extras either, but I'm certainly anal when it comes to picture quality, having given myself all sorts of headaches with advanced upscaling techniques and whatnot.

Of course, where I worked doesn't represent the entire country, either. But in a town split between early adopters and rednecks lacking sufficient teeth, plus a few normal people, I figure I can make fairly safe estimates. If it weren't for DRM and my refusal to let the MPAA have any of my money, I'd probably be willing to pay ten bucks for a movie with slightly gimped resolution, if only for the fact that it would mean I have no moral conflict whatsoever with getting a proper copy off of bittorrent.

Audio CD more expensive than DVD

[PineHall]

I am a little late in posting, but I checked Amazon. The Little Mermaid DVD (2 DVDs) costs $14.87 (full price $29.99) and the The Little Mermaid audio CD (1 CD) costs $14.99 (full price $18.98). So I can get the DVDs for less money than the audio CD. That does not seem right, yet from my experience it seems to be not that unusual. (To be fair I listed the full prices too which seems more in line with my expectations.) Is the demand that much higher for the audio CD than for the DVD? It is my guess that the wholesale prices of the audio CDs are inflated.

Re:Yes, Apple does the same thing, ...

[LO0G]

But that's NOT the iTS model. The iTS model is to provide content for iPods, thus increasing the value proposition of iPods, thus increasing the sales of iPods.

Apple receives no revenue from iTS. It's sort-of a backwards razors and razor blades model - instead of selling the razor below cost and making money on the blades, Apple sells the player for a huge amount of profit and gives away the content at cost to encourage further sales of the player.

People like to buy online

[chifut]

It's easier to download the movie online, without taking your fat ass from the couch and going to the filthy Walmart.

So yes, for every train there are passengers.

Obviously, for most people, downloading such movies for $12.99 is a not a good deal.

There is less money to ship the things

[Tjp($)pjT]

Target and Walmart are buying a different version of the movie. It is in a tangible, unlimited sharing form. iTunes M Store sells an intangible collection of bits that needed no additional packageing per unit, so cost less to distribute. It has usage restrictions. Tell Target and Walmart to start a download service for movies and quit gripping.

Loss of ability to resell

[peter Payne]

Part of the reason download versions need to be less expensive is, we as consumers lose the ability to resell our product. I mean, I've got three copie of Blade Runner, and because they're on DVD I can sell them on Amazon or wherever to recover some of my costs. If a download movie cost the same as a DVD in package, well, I wouldn't buy.

It only works for TV

[ben there...]

I've bought 0 movies from Amazon and iTMS, but I've spent over $80. For TV episodes and music videos it provides value to me to be able to download them, because they're either not available in that quality otherwise, or you'd have to buy a whole DVD compliation anyway for $15 when you only wanted part of it. Also, shows are sometimes available within a couple days of "first run."

I'm torn between liking that they're releasing more shows in HQ because of iTMS/Unbox and hoping they don't decide *not* to release the DVD compilations because they already released the download of it.

I can't see why I'd buy a movie from either service though and wait a few hours with DSL, when I could just rent it from Netflix and have it in 2 days for much cheaper (~$1).

Re:Yes, Apple does the same thing, ...

[geoffspear]

Your analysis of what Apple's business model is would be a lot more credible if you knew what the word "revenue" meant. Even moreso if you were actually correct that iTS wakes no profit which is what I assume you meant. It may not have a huge profit margin, but they're not exactly giving away the content "at cost".

Re:Yes, Apple does the same thing, ...

[LO0G]

You're right, my bad. And I believe that once you account for Apple's costs (bandwidth ain't free), they make no profit off the service. iTS exists solely to provide content for iPods.

Alternative Headline

[Swift2001]

"Wal-Mart Wants to Abolish Physical Reality" to eliminate price differences with free oxygen of atmosphere.

The $12.99 price has already been forced on Apple by the Studios so as not to piss off their big retailers. $9.99 is far more reasonable, given that iTunes offers less resolution, no extras, and makes burning to DVD impossible. In fact, $5.99 would be fair, with $9.99 for a version you could burn.

The big box retailers need trucks, people to stock the shelves, retail clerks, and they sell a fancy package, a DVD 9 configuration with extras and all the rest, booklets, etc.-- of course their prices are higher, because their costs are higher all along the way!

In fact, this is the same kind of whipsawing that Target and Wal-Mart have been using against labor for 20 years. That's why they pay slave wages and employ a majority of part-timers because they won't have to worry about health insurance or other benefits. Disgusting cretins.

$300 iTV vs. $600 Mac mini?

[norminator]

No, it won't cost $300 per TV to stream movies to your TV. That's only if you want the convenient controls the iTV (or whatever they'll call it) will give you. You can connect most Macs to your TV now, you just have to control the playback from the Mac, not a nice remote from your couch.

Actually, the iMacs and Mac Minis ship with the remote, too, so if you connect those to your TV, then you can still use a remote. But my point about the $300 iTV box is that anyone can watch a DVD anywhere in their house with relatively cheap $30 DVD players hooked up to each TV. If you have to have a $300 set-top box or even worse, a $600+ computer, at each TV, then that is seriously a pain in the butt. There's very little flexibility for watching iTMS video on TVs. Sure, you can hook up your iPod... if your movie doesn't outlast your battery life, but that's still a $250 cost per TV.

I'm not saying that digital downloads are not useful, or that they are not the way of the future. I have bought TV shows on iTMS (no movies... yet). I'm just saying that for the current prices, the physical DVD purchased at a brick & mortar retial store is a much more compelling medium.

Movie studios should get out of the DVD business..

[GWBasic]

Movie studios should just get out of the DVD business. Instead, they should sell .isos to retailers, and let the retailers print the DVDs.