Apple is losing money on iTunes Movies - Will it pay off?
May 5th, 2008 | by Tony Steidler-Dennison |(Via Apple Gazette.)
It was reported late last week that Apple is paying $16.00 for every $14.99 movie that it sells in iTunes under its new deal with major studios like 20th Century Fox, The Walt Disney Studios, Warner Bros., and Paramount Pictures…just to name a few. All the major studios are involved…and now its clear why.
Apple is calling it a “loss leader” and hoping that it will help them finally get ahold of the downloadable movie market that they so desperately want to dominate (I know it can be argued that they already “dominate” in this area - but we all know they want it to expand - and to dominate the expansion).
I can understand the want to do this - but I’m not convinced yet that its going to pay off for them.
What I really can’t figure out, though, is what’s going on in the minds of those pea-brain executives at the studios. Universal, for example, would love nothing more than push iTunes under a bus for music, but they’ve made a deal that could potentially give Apple the same iron grip it has on digital music downloads to digital movie downloads.
Full story here
