Report: Warner Bros. in iTunes rental deal with Apple, joining Fox, Paramount, Disney, Lions Gate

“Apple Inc., maker of the top-selling iPod media player, will let iTunes users rent movies as well as buy them and will add Warner Bros. and Fox as suppliers, according to people familiar with the agreements,” Andy Fixmer and Connie Guglielmo report for Bloomberg.

“Joining Warner Bros. and News Corp.’s Fox in supplying rental films are Viacom Inc.’s Paramount, Walt Disney Co. and Lions Gate Entertainment Corp., said two people who asked not to be identified because the plans aren’t public,” Fixmer and Guglielmo report.

“Apple will announce the rental service Jan. 15, the people said. New releases and older titles will rent for $3.99 for 24 hours. The lower-priced rentals and additional titles may help boost the popularity of Apple’s iPod media players, iPhone and Apple TV set-top box, which delivers shows to widescreen TV sets,” Fixmer and Guglielmo report. “‘Once a couple of studios do it, how long can the others resist?’ Richard Greenfield, a Pali Capital analyst, said in an interview. ‘It becomes only a matter of minutes before the others come on board too.'”

“Jobs may also use his [Jan. 15th Macworld Expo keynote] speech to announce an update to Apple TV, which transmits content from a Mac or PC for viewing on widescreen TVs, Bear Stearns & Co. analyst Andrew Neff said in an interview,” Fixmer and Guglielmo report.

Full article here.

61 Comments

  1. If true, and they actually add stuff from the old catalog of film and make it HD, then that will make this take off.
    Would just love to rent “The Good, The Bad and The Ugly” in HD and see all the detail. Especially since most of us have only been able to see it on good old TV.
    Truely the next best thing to seeing it in the theater.

  2. I hope it’s not 24 hours from time of download. Even the xbox live service let’s you hold onto the movie for two weeks, and doesn’t start the 24 hour countdown until you start watching it. Would really suck if xbox had a better deal than itunes.

    Of course a ‘watch as many times as you want to in a week’ plan would be more to my liking. Guess we’ll see on Tuesday.

  3. First, there is nothing to substantiate these rumors of studios striking deals with Apple for movie rentals. Second, these are highly questionable sources. Financial Times. Bloomberg. Whatever.

    This notion is even more preposterous when you consider that Microsoft already has movie rentals on their Xbox Live platform. End of story. If the rumors are true—and that’s a really big if—how does itty bitty 3% market share Apple think they can make this work?

    Your potential. Our passion.™

  4. I for one will NOT rent if it is that expensive. Netflixs offers unlimited rentals for a month. So, I could easily get 15-20 movies in the amount of money I’d spend for 5 iTunes ones. Plus, I can view them whenever I want. Perhaps not that day, but next week.

    They should do what Daniel Eran suggested in his article about iTunes rentals. Steve Jobs would be extremely stupid to have a pricing/time structure as reported.

  5. This is cool and all, and the more customer options the better, but at $3.99, why is this any better than renting on demand from my existing cable box? AppleTV faces the same hurdles as Tivo, trying to convince customers to pay $300+ for something they can get the core features of from thier existing cable box. Yes, both Apple and Tivo offer a superior user experience, but money talks.

  6. ZuneTang is right (perhaps a first) – these are just rumors. We’ll have to wait until at least the 15th to see what really going to happen.

    But ZuneTang is completely off base with this comment: “If the rumors are true—and that’s a really big if—how does itty bitty 3% market share Apple think they can make this work?”

    The market share of the Mac is irrelevant. The market share of iTunes is what counts first and foremost since it will be the distribution channel allowing movies to run on iPods, iTouch, iPhones and Apple TV. As you all know. iTunes is available on both the Mac and PCs.

    It’s a question of ease of use (convenience). People have all sorts of ways of downloading movie content right now. But it’s clunky. If Apple can (and I believe the can) deliver on the promise of a pleasant selection, download and presentation process, then digital downloads of movies will become the new model for watching paid for movie content.

  7. 24hrs from start of viewing seems to go against Jobs’ style. Something along the lines of 72hrs makes more sense, as that is what people are generally used to. However, it’s more like Steve to do something a little better, like using the Netflix model but apply it to downloads, so that you can keep one movie, let’s say up to a month, until you download the next. And, wouldn’t it be great if you could just queue up 7 movies or so, and they don’t get billed until you view them, if ever? That way you eliminate the download wait.

    I suspect Steve’s rental model will be more forward-thinking than anything rumored so far.

  8. I’ve had the distinct feeling these last few weeks that these assorted leaks are part of a well-orchestrated campaign by Apple to fill the pre-MacWorld vacuum with just enough tantalizing news to neutralize the usual frenzy of crazy speculation. This way they can keep expectations from getting out of hand while carefully saving the best for last. Same thing for announcing the Quad towers and new X-Serves.

    My hunch is also that the big surprises won’t be as much new hardware as breathtaking integration, ease-of-use and standards at a time when almost every other phone, tv, computer, pda, audio device and online scheme is becoming more frustrating. I’d set forth some predictions, but that would just fuel the crazy speculation, no?

  9. @ChrisM
    This is cool and all, and the more customer options the better, but at $3.99, why is this any better than renting on demand from my existing cable box?

    Roughly speaking, 60% of US Households with TV’s have CATV, another 25% have Satellite, and the remaining 15-20% have neither, which means there’s very roughly 25 million households using OTA (NTSC today, ATSC in 2009).

    The average CATV monthly bill is $42.76 (as per ncta.com), which works out to a tad over $500/year. Satellite is about the same, whereas OTA is essentially free (you’ll generally need to buy an antenna system every 5-10 years).

    What your local CATV operator doesn’t want to tell you is that OTA ATSC (HDTV) signal is pretty dang good, if you’re within a coverage area (check yours at antennaweb.org).

    I can envision going to OTA ATSC for the mainstream (non-premium) channels for free, then use my internet connection for downloading the premium stuff. It all depends on how much of what stuff you want to watch as to what makes the best economic sense, but if one is a fairly infrequent viewer of premium content (1x/week), the time until payback for an ATV box is still under two years.

    -hh

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