“Apple Computer Inc. and Amazon.com Inc. are both quietly negotiating with the studios to make movie downloads the next frontier, according to informed insiders,” Anne Thompson reports for The Hollywood Reporter.
“Officials at both Internet trailblazers declined to discuss any such moves, but the evidence is mounting,” Thompson reports. “There has been wide speculation that the secretive Apple could bring out a new horizontal video iPod device, with a larger screen, by the end of this year. And Apple is reportedly trying to negotiate a reasonable movie-download price with the studios.”
Thompson asks, “What is the right price for a high-resolution movie download? $5? $15? ‘The studios don’t want to figure that out yet,’ one studio digital executive says, ‘not until digital downloads make real money, or Wal-Mart wants to get into that business.'”
Full article, mainly about Amazon, here.
[Thanks to MacDailyNews Reader “Mac a day” for the heads up.]
Related articles:
Does Apple face delivery issue if they want to sell movies via iTunes Store? – June 28, 2006
Warner Bros. to distribute movies on Guba.com – June 27, 2006
BusinessWeek: Apple agreement with movie studios for iTunes Store unlikely any time soon – June 21, 2006
Apple prepares debut of full-length feature films via iTunes Store in time for 2006 holiday season – June 20, 2006
Report: Movie studios flatly reject Apples’ proposed $9.99 pricing for feature films via iTunes – June 19, 2006
Report: Apple in negotiations with movie studios; $9.99 feature films coming to iTunes soon? – June 19, 2006
Disney to sell movies over Internet via CinemaNow in Windows Media Video format – June 05, 2006
Warner Bros. to sell movies and TV shows via BitTorrent – May 09, 2006
Universal launches film download/DVD service in UK – March 23, 2006
If Front Row can stream movie trailers from Apple, why not whole movies? – January 06, 2006
BusinessWeek: Movie studios need to smarten up and let Apple sell their movies – or be left behind – October 18, 2005
Universal to put its movies online – October 06, 2005
My problem with a ‘blanket set price’ is that not all movies, like songs, should be priced the same.
There needs to be a drastic ‘price restructure’ on the iTunes Music Store in my opinion.
Why should a song that was released in the 1940s by a long forgotten jazz singer be the same price as a very popular pop star from today?
Albums I can find at Walmart, Target or even Sam Goody for 1/3rd of the price go for full price on iTunes and that’s just not right.
Same goes for the TV Shows. You can by the Munsters at Best Buy for 1/2 of what iTunes sells it for…because iTunes charges the set ‘blanket price’.
In order for movies to be greatly popular, who’d pay full price for some movie that’s being rerun on cable 3 times a week and was made 30 years ago??
Sure, we’ll pay full price for something popular but get screwed on old stuff.
So you want to pay $5-$10 for the #1 hit song and $.50 for Louis Armstrong? I prefer one blanket price. Movies could be different, but why should I pay a high price for a song, I might not listen to in a few months anyway?
I would have thought that a good move would be the addition of added value content to go with HD-DVD or BLU-RAY discs. If they can tie themselves into the movie business by getting itunes onto standalone non-computer devices it can surely only increase their standing. They may not make anything on the hardware end (in comparison to the iPod/music angle) but full movie downloads still have bandwidth problems. I’ve read about next-gen dvd’s having downloadable trailers, commentaries etc. If iTunes can host them, tie them in with podcasts etc it will ensconce them.
Amazing how the movie studios bow down to Wal-Mart. Wal-Mart is one of the most evil companies in America (right behind Monsanto). Check out the Wal-Mart documentary at http://www.walmartmovie.com
Appls IS the Walmart of the digital download arena.
And I would say that Walmart is the Apple of the business to be clever… but in truth.. they are not even that big.
“or Wal-Mart wants to get into that business.”
WTF?
Who cares about Walmart.
“Why should a song that was released in the 1940s by a long forgotten jazz singer be the same price as a very popular pop star from today?”
This implies that it should cost less but the arguement could be made that it should be priced considerably higher. It takes the same time to encode and the same space on the servers but will be downloaded maybe 500 times verses the 50,000,000 times for the hot single. In the past you may have had to roam city to city and store to store to lay your hands on a piece of vinyl that started degrading the first time the diamond stylus traced the path around it’s surface. I love the world of point, click and download for a buck. (which is what I recall a single costing in the early days of the Beatles.)
I vote for the mechanism that gives customers the best value.
Bill H has right, its called volume discount.
Stay with the revolution Apple!
Surely the quality of music to any given listener is timeless if that track is enjoyed by that listener. On the other hand movies are rarely something you wish to view continually and therefore the older they are and the more they have been shown and viewed comparatively the less valuable they tend to become, even the top notch block busters. Therefore I think that their intrinsic monetary value varies far more than with music. I think a single price is defendable for music though brand new tracks could arguably have a higher value for a while, but a single price for films seems prtty unworkable to me. That said any price regime should be as simple as possible to understand and different price points kept to a minimum.
Single price is nice and easy.
I rather think that music/movie companies will try to price UP for new stuff, rather than DOWN for old ‘uns.
Or maybe I’m just an old cynic!
I stopped shopping at Walmart 4 years ago and will never spend one cent in their stores ever again.
Walmart is NOT the Apple of the business world, not that it makes any sense to say that to begin with. Apple has a soul, Walmart does not.
Christopher is obviously a paid shill for the RIAA. Either that or his just a mentally challenged 14 year old.
Albums I can find at Walmart, Target or even Sam Goody for 1/3rd of the price go for full price on iTunes and that’s just not right.
Then buy it at Walmart, dimwit.
Sure, we’ll pay full price for something popular but get screwed on old stuff.
If you feel you’re “getting screwed” and yet you still purchase, you must be mentally challenged. If you feel the transaction is unfair, don’t participate. It’s really that simple. If the movie is on three times a week on basic cable and it’s “made 30 years ago” (though I don’t understand how that effects quality or value), don’t buy it. Why are you arguing that you should be able to buy dog shit for 50 cents and horse shit for a dollar?
Me, I won’t buy a low quality movie for more than $5.
Screw Walmart and screw the NASCAR fans that shop there.
The “Market” is like water. In time it will, without fail, find it’s own level. The problem is that no one wants to get locked into a long term contract that could, ultimately, be disadvantageous. Once again, the inability of sellers and buyers to be able to do business without the spectre of lawsuits hanging over every move is thwarting advances that would otherwise naturally occur.
“Why should a song that was released in the 1940s by a long forgotten jazz singer be the same price as a very popular pop star from today?”
I agree. No way would I be willing to pay as much for the latest flash-in-the-pan pop loser as I would for Billie Holiday or Oscar Peterson.
If your music is good enough to have an audience 60+ years after the fact, then the price should go up…
Wal-Mart has lost their soul. As long as Sam Walton was alive, they kept that “buy America” thing going and generally did the right thing. Ever since then, they’ve mistreated suppliers, let their stores become trashy (physically and morally), and cut out customer service completely. I shop there only under duress.
“So you want to pay $5-$10 for the #1 hit song and $.50 for Louis Armstrong? I prefer one blanket price. Movies could be different, but why should I pay a high price for a song, I might not listen to in a few months anyway?”
That’d be just perfect for me. I’d load up on rare Satchmo cuts and dis Madonna’s overpriced crap. As you said, which one do you want to own and listen for years and years, and which one would be fine to catch on the radio when it’s in the Top 10.
Listen people,
Price-restructuring will only work one-way. It will only make hits cost more, it won’t make old songs cost less. The whole outcry from the labels about wanting to have a tiered pricing system on the iTMS is a coverup for wanting to raise prices. Record execs are infamously greedy and they will *always* be pursuing ways to extract more money from consumers.
I wouldn’t pay $5 to download a movie of any quality. The free-and-easy black market download options, not to mention NetFlix, are making $5 per movie a marketing mistake. There is so much recordable content being broadcast just on cable TV that content itself has been cheapened beyond $5 per 2-hour movie.
I don’t see the movie industry settling for less than $5, but I also don’t see consumers embracing more than $3.50. They’re already being bombarded with cheaper options. Every once in a while someone will want a particular movie ‘right now’ and didn’t have the foresight to have it ready in advance (NetFlix, Tivo, retail, etc.) At those moments, are few, a higher price will be accepted, but only if the purchaser has never heard of download bootlegs.
Movies, unlike music, are usually enjoyed only once. That changes things.
This is all very simple. The precise prices might be debateable, but here is a mult-tiered approach that consumers, studios and retailers might accept:
DOWNLOAND PRICES – NEW RELEASE MOVIES
$19.99 on day of theatrical release w/DVD backup (mailed)
$9.99 on day of theatrical release w/no DVD
$5.99 after 90 days w/no DVD
$9.99 after 90 days w/DVD backup (mailed)
$3.99 single viewing with expiration date
Ideally, widescreen and high definition (720p), not 480i or 480p. This is a reasonable compromise for downloads that improves quality for HDTV displays without imposing the longest long download times of 1080i or 1080p.
$18.99 HD-DVD/Blu-Ray: 1080p. Studios choose the release date.
Using 720p as the online standard is a good compromise resolution for fast downloads. Consumers will NOT pay the same price for downloads that they pay for a DVD, which gives them a simple storage option. With downloads, we have to pay for the storage and the pipeline (and figure out what storage to use. Also, HDTV owners want access to new movies sooner — as they are released in theaters, or quickly thereafter (within a weeek or two, not months). Get with the program now, or continue to fight illegal downloads and watch them take over movie sales, just as they did with music. Choose wisely. Do nothing and ye shall perish.
Oops: HD-DVD/Blu-Ray (1080p) probably ought to read $18.99-$24.99: Studios choose the release dates…As a download technology, this is way off in the future due to the lengthy downloads times we’d encounter…
“Why should a song that was released in the 1940s by a long forgotten jazz singer be the same price as a very popular pop star from today?”
Because if you like the song enough to pay for it, it has the same value to you as a listener. Thus, what’s the difference in the two? At this point a song for sale is a song for sale. They both are equal especially in Apple’s eyes.
If you’re thinking the older are going to be cheaper, you’re mistaken. No one, especially the record companies, is saying anything about making them cheaper. Their goal is to charge you MORE for the newer songs, not less for the older ones.
This is a no brainer. I vote for ITMS not changing their pricing.
“Why should a song that was released in the 1940s by a long forgotten jazz singer be the same price as a very popular pop star from today?”
There are fixed costs when it comes to selling old music no longer covered by copyright. On CD, the costs are about 10 cents per CD plus a little bit of shipping and the retailers markup. $2.00 max. The rest is profit for the CD producer.
On iTMS those costs per album are $7.00 to the labels and about $2.00 to transmit the tunes.
As usual, blame the labels.
And remember, the labels wanted to raise the price of the popular cuts, not lower the price of the obscure tunes.
Pricing music is interesting:
For a given song, a label holds the monopoly. It can therefore set the price arbitrarily to the point where it extracts the most money out of consumers. That can only be bad for the consumer.
You could argue that a different song might be a substitute, but I doubt that another label can realistically compete on price. A song is not easy to substitute with a different song. Therefore this monopoly works quite well.
As Apple gets additional value out of providing the perfect music store for their customers, it makes sense for them to *REDUCE* this monopoly effect the labes have. They can do this by arbitrarily fixing prices, given they have the negotiating power (and they have, in form of 50million iPods that won’t play DRM from any other store!). You could argue whether 1$ is the right price point, but I seriously doubt that the arbitrary label-chosen price would be below that in many instances. Therefore Apple cuts of all the profit labels could make above 1$ and gives that profit to its customers.
The customers in turn love that and buy the songs, lock themselves in, buy more iPods and give Apple more power to negotiate even better deals. In a way, we are employing Apple to squeeze out the labels – that’s good for us!
Until the day, when everybody uses Apple at which point Apple can turn the lock-in against its customers to raise prices to raise their profit margin on downloads. However, recent legistlation efforts are likely to prevent this, the people would appeal to the law, and the law would force Apple to open up the lock-in.
So: This is all good, we are squeezing out a middle man in business who is trying to use a monopoly against us. Don’t let them fool you, fixed pricing is better for us. Now, lets start chipping away on that 1$… 89c anyone?
when an artist sells a song on itunes why are they charged packaging fees by the labels