Warner Bros, Paramount join iTunes movie rental discussions

[AppleInsider]

Apple is closing in on agreements with almost all of the major motion picture studios for an iTunes movie rental service that will serve up 24-hour rentals for $3.99 a pop, according to a published report.

Citing sources, BusinessWeek reports that of the more prominent studios, only Universal -- whose parent company NBC previously yanked its TV shows from iTunes over a pricing dispute -- is not currently discussing a movie deal with Apple.

Specifically, Apple is said to be nearing agreements with Warner Bros., Paramount Pictures, and Lionsgate to allow movie sales, rentals, or both through its iTunes digital download service.

The Cupertino-based electronics maker is already reported to have sewn up a similar deal with Twentieth Century Fox for both rentals and sales, which is expected to be announced at next week's Macworld Expo in San Francisco.

Thus far, Apple has faced difficulties translating its success in the digital music business over to film downloads, as Hollywood studios have proven less willing to conform to chief executive Steve Jobs' demand for uniform and low-cost pricing structures. Its Apple TV set-top-box, which serves to stream iTunes movie content to big-screen TVs, has routinely been characterized as a dud by pundits and industry watchers.

Through iTunes, Apple currently offers Disney's movie catalog for sale at prices ranging from $9.99 for library titles to $14.99 for new releases. Other studios, however, have so far balked at deals that would see their own catalogs made available under a similar arrangement.

So what's courted many of the majors out of their standoff with the iTunes operator and back to the bargaining table? Neither the studios nor Apple are talking, but BusinessWeek suggests concessions have been made on the part of Jobs to pay closer to the $17 wholesale price the studios get from "physical" DVD sales by Wal-Mart and other big-box retailers.

For movie sales, it's unclear whether Apple will eat the cost of the higher-priced downloads in order to boost sales of its fledgeling Apple TV device, or pass those costs on to the consumer by raising the sale price of some of the movies it will offer through iTunes.

On the rental front, it's unknown how much studios are demanding for each movie rental, though reports have stated that Twentieth Century Fox has agreed to a deal that will see Apple charge $3.99 for rentals that will expire 24-hours after they've been purchased.

Warner Bros. and Paramount are reportedly mulling agreements that would see their movie catalogs made available on iTunes for both sale and rental through a similar set of arrangements, and Sony is also said to be interest. However, one ongoing source of contention between Apple and the studios is said to be Hollywood's practice of requiring a 30-day grace period between the time new films make their debut on physical DVD and when they are released for electronic distribution.

BusinessWeek says Jobs wants new movies available for download "day and date" with DVD releases so that iPod users can rent them the same day the DVDs become available at Blockbuster, Wal-Mart, and other rental venues.

Fox appears to have backed down from that 30-day requirement, but other studios are still studying the issue, according to the publication. These include Warner Bros., which is said to be "contemplating" the demands, and Disney which has surprisingly declined.

It remains unclear whether studios other than Fox will have inked formal agreements with Apple ahead of next week's Macworld Expo.

[ View this article at AppleInsider.com ]

[CosmoNut]

$3.99 for 24 hours? That seems a bit excessive since I can get a movie for a week at Blockbuster for the same amount or at a Redbox for 99 cents per day.

But people will pay it because they're tools and they like the convenience.

The movies better be HD, though. I'd pay $3.99 for that.

[tundraboy]

Yup, first up they need it to be DVD quality or better.

Second, if along with the rental announcement they include a significant drop in AppleTV prices and/or introudce a version than can play DVDs then they stand a better chance of lighting a fire under their rental/AppleTV business.

[solsun]

Originally Posted by CosmoNut

$3.99 for 24 hours? That seems a bit excessive since I can get a movie for a week at Blockbuster for the same amount or at a Redbox for 99 cents per day.

But people will pay it because they're tools and they like the convenience.

The movies better be HD, though. I'd pay $3.99 for that.

I think the point is trying to compete with Blockbuster etc... For the same price you have the convenience of not having to drive to and from the video store and never having out of stock titles.. $3.99 seems a pretty standard price when compared to other on demand services.

However, I do agree that they need to up the quality. HD 720p would be nice, but they need to look at least as good as standard DVD's if they're going to be beamed onto widescreen HD TV sets.

[cwoloszynski]

So, does this link into Leopard and allow any Leopard user to use iTunes to buy the show and view it via the HDMI connector output on my laptop?

I remember hearing that Leopard's FrontRow is exactly the same as AppleTV.

If so, that significantly opens up the way for watching videos at my house!!!! That would be very sweet.

[solipsism]

Originally Posted by CosmoNut

$3.99 for 24 hours? That seems a bit excessive since I can get a movie for a week at Blockbuster for the same amount or at a Redbox for 99 cents per day.

But people will pay it because they're tools and they like the convenience.

The movies better be HD, though. I'd pay $3.99 for that.

That price is inline with cable company's VOD services, which aren't in high def. That is the most direct competition for this with the added bonus of being able to be used on your iDevices.

Originally Posted by tundraboy

Yup, first up they need it to be DVD quality or better.

Second, if along with the rental announcement they include a significant drop in AppleTV prices and/or introudce a version than can play DVDs then they stand a better chance of lighting a fire under their rental/AppleTV business.

How about a stackable compliment to the AppleTV that uses the USB 2.0 (you don't 480Mb/sec for diagnostics) to connect a DVD or Blu-ray player.

The price point is fine, but an updated version would be in order. Plus, a updated OS that allows for renting of videos and instant viewing, like with iTunes, right from media extender.

[aplnub]

Dont forget that Apple has some issues with download speed on their movies. I bought two this past weekend and they flew up until there was about 500 MB left and then it took 1.5 hours from that point to complete. I have the highest speed DSL AT&T offers to residential customers where I am at. It's fast...

[solipsism]

Originally Posted by aplnub

Dont forget that Apple has some issues with download speed on their movies. I bought two this past weekend and they flew up until there was about 500 MB left and then it took 1.5 hours from that point to complete. I have the highest speed DSL AT&T offers to residential customers where I am at. It's fast...

I have purchased 87 videos from iTS. I have always gotten excellent speeds, even after Xmas when I figure the servers would be bogged down. I would say that I've averaged 6-7Mb/sec and have seen 17Mb/sec. That is surprising since 16Mb/sec is my supposedly my theoretical maximum from my internet provider.

[ericgorr]

Originally Posted by solsun

I think the point is trying to compete with Blockbuster etc... For the same price you have the convenience of not having to drive to and from the video store and never having out of stock titles.. $3.99 seems a pretty standard price when compared to other on demand services.

At $3.99, I'll never go through the inconvenience of getting it setup.

There is nothing inconvenient about Netflix and I can get many, many more movies for the same amount of money. Furthermore, for the extremely rare moments when I have a visitor who does not want to watch a movie I own or a movie I have via Netflix, I find that the PPV or On-Demand options of Dish Network are sufficient.

I figure this service would be worthwhile to me at ~$0.50 per rental. $3.99 is simply a ripoff and I hope the Apple can eventually force the studios to recognize this as well.

[solipsism]

Originally Posted by ericgorr

At $3.99, I'll never go through the inconvenience of getting it setup.

There is nothing inconvenient about Netflix and I can get many, many more movies for the same amount of money. Furthermore, for the extremely rare moments when I have a visitor who does not want to watch a movie I own or a movie I have via Netflix, I find that the PPV or On-Demand options of Dish Network are sufficient.

I figure this service would be worthwhile to me at ~$0.50 per rental. $3.99 is simply a ripoff and I hope the Apple can eventually force the studios to recognize this as well.

That is a lot of FUD.

[DeaPeaJay]

17 bucks to buy a movie is daylight robbery though. There's no physical purchase, and no special features, no movie artwork insert. You're getting a lot less, and I rarely if ever pay that much for a DVD anyway. Now if it were 720p, I might feel different.

[ascii]

I would pay $4 for a movie rental, as long as it is at least 720p, since TVs are big these days.

As for buying... well, DVDs have a lot of extras (Director's commentary etc). And if you're buying a movie to keep, you must really love it, so you would want those things.

[bommai]

Originally Posted by solipsism

That is a lot of FUD.

I can go through about 8 movies a month on Netflix one at a time plan that costs $8.99 per month. That works out to about $1.12/movie. I can even get Bluray or HD-DVD movies. So, $3.99 is a lot. However, for people that watch only a few movies a month, this service might be useful.

[steviet02]

Originally Posted by solipsism

That is a lot of FUD.

I don't know what you are used to paying for rentals, but my Netflix ratio of cost/movie rental works out to be about ~$1.00 - $1.25 a movie, depending on my viewing habits. While $0.50 is almost impossible to hit with bandwidth costs and studio payouts, it's not as far off from my ratio than $3.99.

[Dave K.]

Originally Posted by solipsism

That is a lot of FUD.

No it isn't. While 50 cents isn't going to happen, most people will not be spending $300 for the privilege of renting movies with no extras for $4 that must be watched within 24 hrs. Sorry.

Dave

[nagromme]

iTunes rentals would be one more option we didn't have before. I won't use that a whole lot, but I won't complain when I want it and the option is there.

It doesn't need to "beat" all other movie options for all people in all situations, and it doesn't need to replace ALL your movie viewing It only needs to have its own strengths in some situations. Which, in terms of speed and convenience, it would have.

I liked Netflix--their selection can't be beat and I'd pick them over Blockbuster any day--but I quit when their idea of "unlimited" proved to have limits in the fine print. There was no way I could get much better than $3.99 on my 1-at-a-time plan. I watched them as fast as I could--which would in theory be economical--but Netflix doesn't like you watching as fast as you can. They throttled me back to keep me at ~4 movies a month, despite the "unlimited" phrasing. (1 at a time TRULY unlimited could easily have been closer to 8 a month. Would have been nice!)

Really the main thing I don't like about Netflix is that it's a subscription. I want per-movie rental: I pay more the more I watch. If Netflix offers that, I'm in! If not, my local Blockbuster is awful, so I'll just have to rent (no subscription please) from iTunes and use the library.

[damian73]

I was tired of reading that a decade ago! No one writes "GM, the Detroit based auto maker", "Allstate, the Northbrook, IL based insurance seller" or "Chevron, the San Ramon, CA based oil company". It doesn't make you sound like a super duper extra smart real journalist. It makes you sound just as stupid as the idiots who started the Cupertino and Redmond thing. Anyone else feel the same?

[nagromme]

Originally Posted by Dave K.

No it isn't. While 50 cents isn't going to happen, most people will not be spending $300 for the privilege of renting movies with no extras for $4 that must be watched within 24 hrs. Sorry.

Dave

Where did the $300 goal come from? I don't think this service needs to average 100 movies per year per user to be a success. People will use it less often, when they want something NOW, and will still use their other movie rental methods too. It doesn't have to be "either or." You don't have to quit Netflix just to rent a movie from iTunes on the spur of the moment when a friend drops in.

[Dave K.]

Originally Posted by nagromme

Where did the $300 goal come from? I don't think this service needs to average 100 movies per year per user to be a success. People will use it less often, when they want something NOW, and will still use their other movie rental methods too. It doesn't have to be "either or." You don't have to quit Netflix just to rent a movie from iTunes on the spur of the moment when a friend drops in.

Sorry.

$300 = Cost of the AppleTV box.

Dave

[heyjp]

The $3.99 doesn't bother me as much as the 24 hours. It would be nice to make it 48 or 72. Then you could download 2 or 3 movies on Friday and have the weekend to watch them. With 24 hours, you can really only download 1 at a time.

Need to be HD, for sure.

Jim

[aross99]

Originally Posted by steviet02

I don't know what you are used to paying for rentals, but my Netflix ratio of cost/movie rental works out to be about ~$1.00 - $1.25 a movie, depending on my viewing habits. While $0.50 is almost impossible to hit with bandwidth costs and studio payouts, it's not as far off from my ratio than $3.99.

I don't think this is is going to be a solution for people who use netflix. It is a solution for the people who make a trip to the local video rental store, or who use PPV - where you pay about $4 to rent a movie.

I don't rent enough movies to bother with netflix, and when I want to rent something, I want to rent it now. Renting movies from the iTMS is a perfect solution for me.

Watching them in my Apple TV makes it even better...

[aross99]

Originally Posted by Dave K.

No it isn't. While 50 cents isn't going to happen, most people will not be spending $300 for the privilege of renting movies with no extras for $4 that must be watched within 24 hrs. Sorry.

Dave

If you are using your Apple TV ONLY for watching movies you rent, then I agree, $300 for the privilege is a little steep.

However, if you use the Apple TV to watch video podcasts; to listen to music w/o your iPod or computer; or show off photos, then I think it is worth it.

[Dave K.]

Originally Posted by aross99

If you are using your Apple TV ONLY for watching movies you rent, then I agree, $300 for the privilege is a little steep.

However, if you use the Apple TV to watch video podcasts; to listen to music w/o your iPod or computer; or show off photos, then I think it is worth it.

The problem is that most people think the AppleTV was too expensive to watch podcast, listen to music, or view photos. A $3.99 for 24 hrs movie services isn't going to make people want the AppleTV device still....

[Dave K.]

Originally Posted by aross99

I don't think this is is going to be a solution for people who use netflix. It is a solution for the people who make a trip to the local video rental store, or who use PPV - where you pay about $4 to rent a movie.

If the service is *as expensive* as the PPV than who would be stupid enough to pay Apple $300 for a device that their cable box is doing right now? The cable box is even more convenient that what Apple could produce....

If Apple introduces movie rentals at $3.99 for 24 hrs it will flop big time.... There are far too many better alternatives out there...

Dave

[g5man]

Originally Posted by aross99

I don't think this is is going to be a solution for people who use netflix. It is a solution for the people who make a trip to the local video rental store, or who use PPV - where you pay about $4 to rent a movie.

I don't rent enough movies to bother with netflix, and when I want to rent something, I want to rent it now. Renting movies from the iTMS is a perfect solution for me.

Watching them in my Apple TV makes it even better...

Bingo


People are missing the big picture.

AppleTV was not created for rentals only. This will be one more feature to compliment all the other cool features.

[ashawley]

Originally Posted by Dave K.

Sorry.

$300 = Cost of the AppleTV box.

Dave

Er, what about just using the iPod (connected to the TV)? Works for me.

I'll definitely use this. We don't have a Blockbuster in our town and I don't bother with VOD so...this is awesome. Especially for those spontaneous moments.

[g5man]

Originally Posted by ericgorr

At $3.99, I'll never go through the inconvenience of getting it setup.

There is nothing inconvenient about Netflix and I can get many, many more movies for the same amount of money. Furthermore, for the extremely rare moments when I have a visitor who does not want to watch a movie I own or a movie I have via Netflix, I find that the PPV or On-Demand options of Dish Network are sufficient.

I figure this service would be worthwhile to me at ~$0.50 per rental. $3.99 is simply a ripoff and I hope the Apple can eventually force the studios to recognize this as well.

I don't think it is a rip off. There are many more people who go to the rental stores then use Netflix. I also suspect that a majority of Netflix customers don't rent enough movies to bring down the prices to .50 a rental. When they do the math and look at their cost per movie, they will quickly realize that it costs them pretty close to $3.99 per movie.

This is an issue of convenience and ease of issue, just like the whole Mac Platform.

I rather press a button and download my rental instead of going to the local video store.

This will compete with the PPV market initially, but in the long run when everyone has broadband and HD TVs, AppleTV will be king since it will offer the easiest and best features of any other device.

In 10 years we will look back and be amazed about its success the same way we look back 7 years after the iPods came out.

[g5man]

Originally Posted by Dave K.

The problem is that most people think the AppleTV was too expensive to watch podcast, listen to music, or view photos. A $3.99 for 24 hrs movie services isn't going to make people want the AppleTV device still....

I think most people have not bought an AppleTV because there are two issues.

One there are still a limited number of HD TV out there at this point.

Mac users are more into their pictures, music, and videos because they are easier to manage. So they are the only ones buying them right now.

When Mac share increases to 15% we will see more AppleTV sold. In the mean time Apple will have to market the ease of use of AppleTV with a Mac vs. PC.

Remember the whole goal here is to sale Mac computers. The iPhone, iPod, and AppleTV are just ways for people to be taught about the benefits of owning a Mac

[e1618978]

Originally Posted by heyjp

The $3.99 doesn't bother me as much as the 24 hours. It would be nice to make it 48 or 72. Then you could download 2 or 3 movies on Friday and have the weekend to watch them. With 24 hours, you can really only download 1 at a time.

Need to be HD, for sure.

Jim

I agree - it needs to be 72h, not 24h, but I don't need HD. I will definitely use iTunes for all my movie rentals when this goes through, since I am very forgetful and pay a ton of late fees to my movie store (don't rent enough to justify netflix - just one movie a month or so).

If it is 24h I will be a lot more careful about what I rent, since the window is so small - I would probably rent more movies if it were 72h.

[SpamSandwich]

Originally Posted by CosmoNut

$3.99 for 24 hours? That seems a bit excessive since I can get a movie for a week at Blockbuster for the same amount or at a Redbox for 99 cents per day.

But people will pay it because they're tools and they like the convenience.

The movies better be HD, though. I'd pay $3.99 for that.

$3.99 is an absolute no-go for me. In certain instances, I imagine it might have some appeal but I'm hard pressed to list any.

[SpamSandwich]

Originally Posted by solipsism

I have purchased 87 videos from iTS. I have always gotten excellent speeds, even after Xmas when I figure the servers would be bogged down. I would say that I've averaged 6-7Mb/sec and have seen 17Mb/sec. That is surprising since 16Mb/sec is my supposedly my theoretical maximum from my internet provider.

Geez, I hope it's worth it to you. I'd rather wait for the DVDs to hit the bargain rack and buy them with all the extras (commentary tracks, deleted scenes, etc.).

[caliminius]

Originally Posted by heyjp

The $3.99 doesn't bother me as much as the 24 hours. It would be nice to make it 48 or 72. Then you could download 2 or 3 movies on Friday and have the weekend to watch them. With 24 hours, you can really only download 1 at a time.

Need to be HD, for sure.

Jim

I believe that just like most download rental services, the 24 hour period doesn't start until you start playing it the first time. Thus you could queue them up to download Friday morning before heading to work, watch on Friday, another Saturday, and finish off the final one on Sunday. Chances are they'll have a secondary expiration date as well, 28 days whether viewed or not.

Still doesn't make me any more interested in an AppleTV, especially with the near complete lack of features that have been added to the device in nearly a year.

[Dave K.]

Originally Posted by g5man

I think most people have not bought an AppleTV because there are two issues.

One there are still a limited number of HD TV out there at this point.

Mac users are more into their pictures, music, and videos because they are easier to manage. So they are the only ones buying them right now.

When Mac share increases to 15% we will see more AppleTV sold. In the mean time Apple will have to market the ease of use of AppleTV with a Mac vs. PC.

Remember the whole goal here is to sale Mac computers. The iPhone, iPod, and AppleTV are just ways for people to be taught about the benefits of owning a Mac

Those are two weak arguments.

The reason why the AppleTV didn't sell well is that it is simply too expensive for what it offers. A $4 rental isn't going to change that.

Dave

[SpamSandwich]

Originally Posted by solipsism

That is a lot of FUD.

I'm wabbit hunting.

[success]

Doesn't matter. It won't be long before the 24 hour restriction will be bypassed and you'll also be able to burn to DVDR no problem.

Every important feature in an iApp has been hacked or bypassed.

[g5man]

Originally Posted by Dave K.

Those are two weak arguments.

The reason why the AppleTV didn't sell well is that it is simply too expensive for what it offers. A $4 rental isn't going to change that.

Dave

I disagree. I have owned one since it has come out and it is worth every penny.

That is the same argument about why Mac are not selling because they are more expensive.

Eventually people will see the value and rentals is one more selling point.

Keep in mind the first iPods $500 and it took two years to sell 1 million of them. 7 years later the most expensive iPod is still $500 and yet people see value in paying that price.

Apple knows what they are doing and AppleTV is a great product which will take time to mature. I don't think price is the reason people have not bought them up like hotcakes.

[Gustav]

Originally Posted by CosmoNut

$3.99 for 24 hours? That seems a bit excessive since I can get a movie for a week at Blockbuster for the same amount or at a Redbox for 99 cents per day.

But people will pay it because they're tools and they like the convenience.

No need to result to personal attacks. Did you stop to think that maybe for a moment that part of the reason Blockbuster rents movies for a week is because people need to drive to the store at a convenient time to pick them up and drop them off?

Also, I don't think that people are understanding that the 24hour limit could be when you start watching the movie, not when you download it.

So, what makes me a tool? Saving gas and time by not driving to the store, or not taking more than a day to watch a movie once I start watching it? I don't know about you, but I can generally watch a movie in about two hours.

Not only that, movies are $5 - $6 to rent where I live.

[Gustav]

Originally Posted by ericgorr

At $3.99, I'll never go through the inconvenience of getting it setup.

There is nothing inconvenient about Netflix and I can get many, many more movies for the same amount of money. Furthermore, for the extremely rare moments when I have a visitor who does not want to watch a movie I own or a movie I have via Netflix, I find that the PPV or On-Demand options of Dish Network are sufficient.

I figure this service would be worthwhile to me at ~$0.50 per rental. $3.99 is simply a ripoff and I hope the Apple can eventually force the studios to recognize this as well.

PPV and On-demand from cable has a tiny library of movies - I suspect Apple will have a lot more. And I don't rent often enough to make use of Netflix. This service seems like a good fit for me.

[1984]

Comcast charges $3.99 for SD and $5.99 for HD for 24 hour rentals so this is in line with their On Demand service. Problem is, I don't use it because it's too expensive. Lower the price or lengthen the rental time. As for $17 purchases that is just ridiculous unless it's 720p. I can buy the DVD version for less and have something tangible to show for my expense.

[Gustav]

Originally Posted by heyjp

The $3.99 doesn't bother me as much as the 24 hours. It would be nice to make it 48 or 72. Then you could download 2 or 3 movies on Friday and have the weekend to watch them. With 24 hours, you can really only download 1 at a time.

While the rumor says 24 hours from when you purchase, are we certain it's not 24 hours from when we start watching? I guess we'll have to wait until next week to know for certain.