Apple to rent or sell 18.25 mil films a year
Apple’s iTunes Store, the 800-pound gorilla in digital music sales, is starting to flex its muscles on the movie side.
Studio execs said that iTunes movie sales and rentals — which the computer company said tops 50,000 daily — dominate the small but closely watched digital movie biz. Apple is now on track to sell or rent 18.25 million movies a year, or triple the number of last year, before it inked deals with all major studios for new-release rentals and sales.
Studio execs say activity immediately spiked once Apple started offering new-release purchases from all the majors in early May and haven’t let up since.
“We’ve been pretty happy with it, especially considering how stunted the business had been before that,” said a digital exec at one major.
“In the first week, they had 20 times the volume of the next biggest customer, and it didn’t go down after that,” said an exec overseeing digital at a rival major.
Previously, Apple sold only new releases from Disney and older catalog fare from studios such as Paramount and Lionsgate. In January, Apple topper Steve Jobs unveiled rental deals with all majors; the tech titan unveiled deals with all the majors to sell movies on iTunes day-and-date with DVD a few months later after ingesting enough movies for launch (Daily Variety, May 2).
Apple declined to break down iTunes movie sales and rental activity further, but studio execs said sales are generating more coin. At this point, new releases are driving the business.
On Thursday, for example, “Fool’s Gold” was the top rental and seller at iTunes, followed by “Jumper,” “The Bucket List,” “The Other Boleyn Girl” and “Semi-Pro” on the sales side.
Execs caution, however, that it’s still too early to gauge sales patterns. Jobs is said to have granted studios better margins on new releases based on a belief that he could make it up on catalog movies, where the margins work in Apple’s favor. ITunes charges consumers $14.99 for new releases and $9.99 for older movies.
At this point, however, movie transactions are a small fraction of the action at iTunes, where music sales dominate. The company said Thursday that consumers have downloaded more than 5 billion songs from the store.