Wal-Mart and Apple talking about being friends
Apple Computer and Wal-Mart are in discussions over an alliance that could allow the retail giant to profit from iTunes movie downloads, says Variety.
According to the report, a deal could take the form of a digital download "coupon" that would allow consumers to buy movies, TV shows or music on iTunes with Apple paying Wal-Mart a percentage of the proceeds.
Apple chief executive Steve Jobs is said to have personally reached out to Wal-Mart CEO H. Lee Scott, "who badly wants to get into the digital film biz."
Apple's new iTunes movie service has been a source of frustration for the retail giant, mainly because Jobs has mandated that movie studios license new movie releases through iTunes for about $3 less than the wholesale price charged to Wal-Mart. So far, only Walt Disney agreed to such terms.
"Studio sources say the rest of the majors are very close to joining Disney in a deal with Apple but are holding off until the end of the key fourth quarter, when half of all DVD sales occur," Variety said.
Wal-Mart, which controls about 40 percent of DVD sales in the US, had previously warned studios about undercutting the price of DVDs in its stores by agreeing to Jobs' terms for iTunes.
The report notes that Wal-Mart's demand "was enough to shatter a planned alliance among Fox, Universal and Lionsgate to join Disney in supplying films to iTunes" earlier this year.
Fox was said to have had a verbal agreement with Apple requiring that it be joined by two others. Meanwhile, its reported that Universal pulled out of the deal first, with the other non-Disney studios following suit.
According to the report, a deal could take the form of a digital download "coupon" that would allow consumers to buy movies, TV shows or music on iTunes with Apple paying Wal-Mart a percentage of the proceeds.
Apple chief executive Steve Jobs is said to have personally reached out to Wal-Mart CEO H. Lee Scott, "who badly wants to get into the digital film biz."
Apple's new iTunes movie service has been a source of frustration for the retail giant, mainly because Jobs has mandated that movie studios license new movie releases through iTunes for about $3 less than the wholesale price charged to Wal-Mart. So far, only Walt Disney agreed to such terms.
"Studio sources say the rest of the majors are very close to joining Disney in a deal with Apple but are holding off until the end of the key fourth quarter, when half of all DVD sales occur," Variety said.
Wal-Mart, which controls about 40 percent of DVD sales in the US, had previously warned studios about undercutting the price of DVDs in its stores by agreeing to Jobs' terms for iTunes.
The report notes that Wal-Mart's demand "was enough to shatter a planned alliance among Fox, Universal and Lionsgate to join Disney in supplying films to iTunes" earlier this year.
Fox was said to have had a verbal agreement with Apple requiring that it be joined by two others. Meanwhile, its reported that Universal pulled out of the deal first, with the other non-Disney studios following suit.
Comments
why would apple want to give profit to walmart for free?
Its business.
Because Wal-Mart is the biggest seller of DVD. Some of the studios are probably nervous about joining iTunes because iTunes undercuts Wal-Mart. Wal-Mart prides itself on undercutting everyone else. Studios fear Wal-Mart may retaliate by ordering fewer of their DVD's. Especially around the crucial holidays.
If Apple shares profit with Wal-Mart, Wal-Mart won't be as bitter about loosing sales to iTunes, studios will not fear Wal-Mart retaliation for joining iTunes.
Its business.
Because Wal-Mart is the biggest seller of DVD. Some of the studios are probably nervous about joining iTunes because iTunes undercuts Wal-Mart. Wal-Mart prides itself on undercutting everyone else. Studios fear Wal-Mart may retaliate by ordering fewer of their DVD's. Especially around the crucial holidays.
If Apple shares profit with Wal-Mart, Wal-Mart won't be as bitter about loosing sales to iTunes, studios will not fear Wal-Mart retaliation for joining iTunes.
We have winner!
Steve Jobs = No dummy,He can make peace and profits at the same time, kind of like a mix of ghandi and Donald trump!
kind of like a mix of ghandi and Donald trump!
That's kind of like mixing matter and anti-matter...
...but point taken.
(and btw, it's spelled "Gandhi")
Its business.
Because Wal-Mart is the biggest seller of DVD. Some of the studios are probably nervous about joining iTunes because iTunes undercuts Wal-Mart. Wal-Mart prides itself on undercutting everyone else. Studios fear Wal-Mart may retaliate by ordering fewer of their DVD's. Especially around the crucial holidays.
If Apple shares profit with Wal-Mart, Wal-Mart won't be as bitter about loosing sales to iTunes, studios will not fear Wal-Mart retaliation for joining iTunes.
Agreed. A peace treaty with Wal-Mart is a great idea, which hopefully will end up with Apple securing other movie studios for iTunes. It's also nice to consolidate a little competition, though the thought of Apple working with Wal-Mart is a little odd.
It could also turn into yet another kick in the pants for Zune.
Step 2: ???
Step 3: Profit!!
What, we are talking about Wal-Mart, right?
This could be a good thing for Apple if it brings in other studios to the Movie Store.
we have a winner indeed! bingo! this will get the other studios to go with apple!
Steve Jobs = No dummy,He can make peace and profits at the same time, kind of like a mix of ghandi and Donald trump!
40% of the DVDs sold in America are sold by WALMART.
Steve can't afford to make enemies out of WALMART with the Zune coming to town.
WALMART will sell iTunes Movie gift cards, you buy it take it home and then decide which movie you want from the Store.
With WALMARTs blessing the other movie studios will jump on board.
The movie giftcards might be a WALMART exclusive.
Gandhi with a bad hairpiece! I can see it now.
<Apu accent>Your FIRED! Please come again.</Apu accent>
Remember, WalMart makes Microsoft look like a mom and pop shop. WalMart has the power to buy Apple outright and explode it for kicks if it wanted. They are not affraid of bullying Apple.
I think Apple would be better off starting their own studio then dealing with WalMart. Besides, how many people who shop at WalMart would buy an Apple product... not many at all is my guess. They want the $15 Mp3 player that holds 30 whole songs.
I see nothing crucial comming out of this. Although, we have seen Apple making alliances with some of the other evil corporations... Coke, and Nike.
They seem to want to get all slutty with the nasties. Damnit Jobs...
Its business.
Because Wal-Mart is the biggest seller of DVD. Some of the studios are probably nervous about joining iTunes because iTunes undercuts Wal-Mart. Wal-Mart prides itself on undercutting everyone else. Studios fear Wal-Mart may retaliate by ordering fewer of their DVD's. Especially around the crucial holidays.
If Apple shares profit with Wal-Mart, Wal-Mart won't be as bitter about loosing sales to iTunes, studios will not fear Wal-Mart retaliation for joining iTunes.
Does that mean that WalMart wasn't afraid of Cinema Now and Unbox?
first post
why would apple want to give profit to walmart for free? What will Apple get in exchange. I doubt this...
As the Variety article said, Apple issues coupons to several chains. It's like a gift certificate. Perhaps that's what they are talking about here as well.
If it smooths the way, then it's fine. No one other than Walmart has this clout.
Does that mean that WalMart wasn't afraid of Cinema Now and Unbox?
I would imagine.
We'll see what happens when MS tries to sell movie downloads.
I don't get this deal. Is Walmart going to hand out some kind of coupon in their stores, or would apple just give them a cut of every movie they sell? The latter sounds ridiculous.
Likely a coupon. There is no way that a business would just give a "cut".
So, I guess these guys are friends because Apple slips Wal-Mart a kickback now? Laughable, but no doubt necessary the way Wal-Mart dominates in this area.
If it were just Walmart, maybe. But it's not. Apple does this with others.
And it was pointed out that Walmart sells more iPods than anyone else. Possibly more than Apple.