It was only a matter of, well, days, before day-and-date would arrive for the VOD and online release of movies, and it has: Apple (NSDQ: AAPL) is expected to announce tomorrow that it has done deals with most of the studios to sell new releases at its iTunes Store the same day as they go on DVD, reports THR, citing sources. The deals include Fox, Walt Disney (NYSE: DIS) Studios, Warner Bros., Paramount, Universal, Sony (NYSE: SNE) Pictures, Lionsgate and New Line, but does not include new titles from MGM. It also extends to boutique firms such as Magnolia and Image Entertainment, the story says.
This should put some competitive pressure, such as the market is, on other services like Amazon (NSDQ: AMZN) Unbox, Movielink and others, though they could end up getting the same deals soon. Apple also announced movie rental deals earlier this year with all studios. Thursday's announcement is expected to contain new data on the success of Apple's movie revenue to date, the story says.
Meanwhile, also today, during Time Warner's (NYSE: TWX) earnings call, CEO Jeff Bewkes announced that Warner Bros. will now release movies for VOD and online service the same day as DVDs. As this NYT story points out, Warner has been experimenting with the new approach for the last few months, and found very little cannibalization (3 to 5 percent) in DVD rentals, and said that the sales of DVDs actually increased, perhaps because of the increased promotion and fewer used rental discs available for sale. It is about the digital margins: "Taking a customer and moving that person over from rental-physical over moving them to VOD day-and-date is like a 60 to 70 percent margin instead of a 20 to 30...So it's about a three-to-one trade."
By Rafat Ali