Apple's iTunes will probably start offering movies soon, and Amazon too, has entered the movie download biz according to press reports today. Amazon (AMZN) will also offer television shows, priced at exactly what iTunes charges: $1.99 an episode. Movies will cost around $8 to $15 at Amazon, and movies can also be rented for around $4. No idea how extensive their offerings will be, but if $15 is the high end for new releases that seems fairly in line with what Apple's expected to do. Consumers will have to figure out their own storage means for digital movies they decide to buy. Will you be burning each of these to a DVD, effectively transferring the manufacturing process to your home? Or will you store everything on drives? The main advantage to me seems to be the ability to get the stuff immediately, and without shipping charges. Just today happened to read a New York Times article about online-only magazine subscriptions, and was struck by the fact to many online-only subscriptions cost exactly as much as buying the print version. The publisher gets to pocket the money saved in printing costs, and this is probably partly why, for example, Popular Mechanics has 1.2 million print subscribers and only 5000 email digital subscribers. Call it: "we cut costs and don't pass the savings on to you" merchandising. Asking us to give up the sense of ownership that a hard copy provides ought to be worth a deeper discount off convention media on this stuff. Make it cheaper and we will buy more of it.
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Reader Comments (Page 1 of 1)
9-08-2006 @ 9:59AM
Vince Chan said...
Frank Barnako had the scoops of how the $15 price-point came to be. Seems like it was a compromise. But the most interesting piece of that article was the market survey done by researchers at the Diffusion group. The research data seemed to show that only 14% of households would be interested in a $15 pricetag while 25% would be interested should the pricetag be at $10. As such, Apple stands to lose out on some significant revenue. But it may be prudent to appease content providers at this stage.
http://blogs.marketwatch.com/barnako/2006/09/apple_studios_s.html
Amazon has registered the domain UnBox.com. Will they be smart and come out with a movie management software for those who've already integrated the PC into the entertainment center? That piece could serve as an alternative for iTunes and offer another means for PC TV audiences to purchase and download movies easier
http://blogs.marketwatch.com/barnako/2006/09/amazon_movies_c.html
Lastly, let's look at the alternatives out there? The $4 rental price is not cheaper, only comparative to retail rental locations. Consumers will have to decide which medium is more convenient. Though the interesting reaction would be how this affects NetFlix's business model because their audiences also wait for delivery.
9-08-2006 @ 9:58AM
RK said...
As of now, one cannot burn DVD with Amazon download. One can only play the movie on Windows media player or a Windows Media Center PC. This information is on the amazon website. Also, it is not clear that the download is of the same quality as a real DVD. The download sizes look smaller than the capacity of DVD; so it is fair to assume that stuff are being left out of the download.