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Sat, May 03, 2008 - Page 10 News List

Apple to sell movies same day as DVD

BIGGER FISH TO FRY Apple’s iTunes service surpassed Wal-Mart last month to become the biggest music retailer in the US and now it is eyeing the movie market


Apple Inc, maker of the iPod media player, will sell movies through its iTunes online store the same day they are released on DVD, building on its success as a music retailer.

New releases from studios, including Paramount Pictures and Warner Bros, will cost US$14.99, Apple said on Thursday in a statement.

Previously, customers may have had to wait several weeks after the DVD debut.

The service will start with movies such as American Gangster and Juno this week.

Chief executive officer Steve Jobs is counting on movies to increase sales of iPods, Macintosh computers and Apple TV, a device that lets users watch downloaded films on their widescreen televisions.

In January, Jobs said customers had purchased 7 million movies, missing his expectations.

Apple began selling movies and television shows on iTunes in October 2005.

“People want to watch a movie as soon as it comes out and they don’t want to have to wait,” said Michael Gartenberg, an analyst at JupiterResearch in New York. “What Apple is doing is knocking down one more barrier for why you wouldn’t want to buy a movie from them.”

New titles will also be available from News Corp’s Twentieth Century Fox, Walt Disney Co, Universal Studios Home Entertainment, Sony Pictures Entertainment Inc, Lions Gate Entertainment Corp, Image Entertainment Inc and First Look Studios Inc.


Studios are betting that Apple will repeat its success in music with films, Gartenberg said.

“They are feeling that iTunes is an important venue,” he said.

Apple, based in Cupertino, California, rose US$6.05, or 3.5 percent, to US$180 as of 4pm New York time in NASDAQ Stock Market trading.

The stock has lost 9.1 percent this year.

With more than 6 million songs, iTunes is already the most popular site for legal music downloads, NPD Group Inc in Port Washington, New York said.


Apple said last month that iTunes surpassed Wal-Mart Stores Inc as the biggest music retailer in the US.

Apple has sold more than 4 billion songs since opening the iTunes store in April 2003.

Apple offers more than 1,500 films, including 200 in high definition.

Studios already sell older movies for US$9.99 each and provide films for rental under a service Jobs introduced in January.

Apple said on Thursday that it has 1,000 movies for rent.

“The Internet is a growing channel and one that many believe is the ultimate future of entertainment distribution,” said Ross Rubin, an analyst with NPD. “For Apple, it’s another step in reaching parity with the retail DVD market.”

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