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Apple branches past studios for film deals

updated 10:35 am EDT, Wed October 24, 2007

Apple skipping studios

Facing stiff resistance from film studios, Apple has turned to other parties to get content on the iTunes Store, reports say. Presently, the major studios on the Store are limited to Disney, MGM, Lionsgate and Paramount, supplying just under 1,000 movies; this leaves out some of the most important studios, such as Fox and Universal. To help fill the gap, Apple has been selling last year's Academy Award-nominated shorts, at a cost of $1.99. Crucially, however, Apple has negotiated for these movies directly, rather than working through a distributor. Each production outfit is thus receiving approximately 55 percent of iTunes revenue, enough to defray costs, though not turn a profit.

The most prominent circumvention of studios may be "Purple Violets," a romantic comedy by famed director Edward Burns. Although well-reviewed and costing only $4 million, the movie has not attracted theatrical distribution, prompting Burns and his company to sell it through iTunes starting on November 20th. This will mark the first time a full-length movie has premiered on iTunes; the ultimate goal, though, is to offset production costs and build steam towards screenings in major American cities.

iTunes is said to be attractive to short filmmakers, who have not typically had a means to make money on their output, but less so to feature producers, for whom the iTunes market is still too small. Burns partner Aaron Lubin remarks that furthermore, as a result of their iTunes deal, DVD distributors have been offering lower advance payments, expecting digital sales to eat into profits.




by MacNN Staff

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Comments

  1. Eldernorm

    Joined: Dec 1969

    0

    Start of a great idea

    I think that this is a real start to a great idea. Small films cost real money but may be too small to distribute to thousands of movie theaters due to todays high cost of promoting a movie.

    This way, the producers make money and how much can depend on how good the movie is.

    Also, I would be much more likely to watch a unknown movie for $2.00 vs $8-10 at a movie theater.

    JMHO, en

  1. Jonathan-Tanya

    Joined: Dec 1969

    0

    Distributor profits

    It's a great thing when distributor profits are lowered. Nevermind profits, actual revenue, should eventually be lowered to zero.

    There is just no reason for traditional distributors in a digital world, and this is a great thing.

    They act as if, their lowering of advance payments is hurting content creators...but the elimination of this middle man taking a big portion of the revenue, actually helps content creators.

    When these dinosaurs, who add no value in a modern world, are finally gone, the revenue gets split between the digital storefront and the content creator...increasing money available to the content creators.

    Whether digital storefronts eventually start offering advance payments, in order to get exclusives....remains to be seen, but I imagine they will begin this practice as well....it'll just take a few more years, for things to mature.

  1. testudo

    Joined: Dec 1969

    0

    Re: distributor profits

    There is just no reason for traditional distributors in a digital world, and this is a great thing.

    Not true. Distributors are still needed, even if you're going all digital. The point of a distributor is to handle the task of getting your product to where you want it to be (which could be a couple of art-house theaters in NY and LA). Without the 'distributor', you're stuck trying to do all this yourself. And while getting a movie or music on just iTunes might not sound so hard, how many producers want to spend all their time trying to get their wares on 50 different 'digital storefronts'?

    And, on the flip side, the stores don't want to deal with 5000 different artists trying to peddle their wares. They want a limited number of distributors to deal with, who handle the details and cuts down on all the hassles with paperwork, copyright, etc.

  1. Peter Bonte

    Joined: Dec 1969

    0

    Re: distributor profits

    iTunes may well become a major distributor for these small theaters. Just make a custom iTunes for the theaters with extended licenses, better quality, simple pricing structure and not to forget easy payment and paperwork.

    iTunes is scaleable to almost everything digital, Apple has pure digital gold in there hands.

  1. robttwo

    Joined: Dec 1969

    0

    T B S A S I T P

    The big studios are shitting in their pants.

    Imagine: Major theater chains receiving their movies through a digital distrubution system (already they do in a limited way). Suddenly, indy or actually any filmaker has cut their cost in HALF if they can distribute themselves. Producers realize they will make more by bypassing the studios altogether, and financing the entire production themselves.

    Hmmm, gives me an idea for a script: once succesful studio boss ends up as a beggar because he can't see the future through his greed.

    Doofuses. The studio heads, that is.

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