Thursday, June 22, 2006


"One question: how freakin' long will it take to download 2 GB movie?!!!!!"

Apple's I-Tunes has been a runaway success with a simple, clever business plan. In 2001, in response to the incredible success of MP3 music downloads and the website Napster who was then facing legal problems, Apple came up with a new website which allowed people to search for and buy any song that Apple had available for 99 cents each. Although the song list was limited (and still is), there are hundreds of thousands of songs available to buy and listen to on your MP3 player or computer.

Apple recently expanded this to include "podcasts" which are simply MP3 files of events or speeches made available for download on the site, usually for free. Some blogs and other sites use this system to get radio shows and audio commentary to customers.

Recently, Apple has been working on a new idea, to make movies available for download. The Movie Blog has the story:

Steve Jobs has apparently tried to convince the studios to agree to a flat rate of $9.99 per movie, much like the flat $.99 per song model they use for music. This is a no brainer right? Look at how successful the flat rate music model has worked. It's an easy decision for the studios to agree to this right? WRONG!

According to Variety, the studios are willing to charge $9.99 per movie for their oldest and least popular films. However, they want to be able to charge up to $19.99 per movie for the more popular stuff.

"We can't be put in a position where we lose the ability to price our most popular content higher than less popular stuff," said a studio exec close to the negotiations.
Commenters responded to this news:

Although i hate the movie studios i dont blame them for wanting more than $9.99 but $19.99 is outrageous 12.99-14.99 would be cool with me.

Who would pay that much(19.99) for something they can go pick up(at a store) with less hassle. not everyone want to spend hours downloading movies but if the price is right its more acceptable.

Also how will this work with movies in high definition the download times would be out of control.

With all the question regarding digital distribution it will be a long time before this will fully catch on but apple seems to really want to be the one who start it with a bang $9.99 would be a steal.
-by Jamie

Ok so this new $19.99 price point would place it where? ABOVE where I pay for most DVDs! Now given I tend to just go to blockbuster and purchase a pre-viewed dvd, but even still! I can almost GUARANTEE to you that these films on iTunes will NOT have any special features, and due to the small screen on the video ipods, or even the rumored redesigned video ipod with a screen size similar to the PSP, they will be far less than DVD resolution. Let alone Blu-Ray or HD-DVD quality.

So it looks like the movie studios, who over the last decade or so have been ever so adept at shooting themselves in the foot, are doing so once again.

According to an article I believe on Slashdot, I could be wrong, a $9.99 price point without special features, and without the costs involved in pressing disks, gives a 70% profit margin to the movie studios. This is the same profit margin given to the music studios with the .99 cent downloads, and the same profit margin given to the tv studios, with the $1.99 episode downloads.

This is a LOT of money to be made for the movie studios, even at 9.99! Especially considering the fact that hard drives crash fairly often, and we all know that due to iTunes DRM there is NO way we'll be able to burn a DVD that we can watch on our home televisions. So a lot of people who don't back up their data will have to re-download/re-purchase movies on occasion.

And they want to increase the price point to $19.99?? Forget it. There is no way you could get me to pay that much money for JUST a movie, that I probably wont be able to burn to a dvd to watch on my television.

So thank you once again to an industry that charges $6.00 for a bottle of soda, and $8 dollars for a bag of POPCORN. You've lost your first customer before you even got started.
-by Justin Flood


This is all about BIG BUSINESS boys and girls. Do you have any idea how pissed off WAL-MART, Furtureshop/Best Buy, and every other major retailer will be? These guys are already having a hard time stock piling the new TV on DVD wave, taking up all the retail space, and now they are going to be undercut by 10-15 dollars? no way in hell is that ever going to happen.

Is it fair that a basic download should cost as much as a physical disc that looks really pretty and has all the special features? nope, but thats how its going to be. So its not going to work, and trust me, the studios are VERY happy this isn't going to work. They are only playing along right now so that they can say "See, this isn't fiesable for movies, we tried, dont hate us, now all of you, get your fat asses back into the theater, pay $12-$15 dollars and give us back our box office"

If they did relent and go for 9.99 they would make TONS of dough, but its one step closer to what they all theaters becoming extinct.

IMHO anyway
-by Norddeth

I cant imagine paying more than 5 - 7 for a downloaded movie, particularly when they are easily downloadable through shall we say other channels for free...

If I really want a movie, I will buy the DVD with the case and everything...but for downloading, about twice rental rates is the max.
-by jimf

Good. Let them.

Wal-Mart will make hand over fist in that endless DVD 5.99 boxed pit in front of thier electronics dept.

I think for a films that are older or have a low budget B film quality to them, bare bones with no extra features a $5.99 to 9.99 price in high def may be not so bad. But nobody's going to shell out $20.00 for something they can get more of at the stores. That's common sense.

Granted, some newer releases may have sites where some content such as special features could be seen. Trailers could be already downloaded in eyepod. Folks will soon to be able to download John and Dougs' commen...oh, well maybe not that far yet.

This is what I see: low budget "recent" films that usually try to find a voice at film fests that *don't* find a distrubutor theatrically, may in find find a *distributor* who will solely work with iTunes, seeing the chance of opportunity. If MPAA submitted, the rating holds (or, like some iTunes, 'mature/explicit content) - I'm betting down on someone like First Look, Lion's Gate, Anchor Bay (who specialize in cult films; one of these days they will branch out) or Newmarket. Trust me...someone will step up. Someone will rule the house. But it will be an indie or two that starts it up at that iTunes price.

There could be a page that gives a brief synopsis of the films; trailers will be under a heading in the Movie Trailer Quicktime page under the respected studio/distributor.

They will make money. Filmmakers will get exposure. I would be all for this.

Oh- and the content will allow folks to burn DVDs. Just the bare bones stuff.
Or even make thier own menu layout/chapter stop for x amount of time.
-by darren seele

There is a big opportunity being missed here. Trying to find a copy of certain movies is impossible. A download service would make the library larger and make Hollywood big bickies.

I have seen a limited number movies available to download in Oz, like a rental service. However the length of hire was dictated by the studios. Some priced them for a 1 day hire at more than twice the price of hiring them for a week. For a few dollars more I could buy the DVD in some cases.

Hollywood is being pressured by DVD sellers and DVD rental stores. But most importantly they have $$$ in their eyes. They would rather have low volume and high prices, blame it on piracy and leverage that into political pressure for control over people's machines. It was not long ago Hollywood was proposing the right to hack into people's machines and delete files.
-by darkbhudda

[technorati icon]

No comments: