Retailers Pressure Studios on Web Deals

mikesd81 writes "Over at the Associated Press, there's an article about retailers pressuring movie studios for the same deals that online servies are getting. Target has sent a letter warning 'that Target might have to reconsider the amount of shelf space allocated for movies if studios undercut the wholesale price of DVDs by giving online services a better deal on digital offerings.' At issue is the low price some studios charge for films downloaded through such fledgling services as MovieLink, CinemaNow and Amazon.com's recently launched video store. The two-disc rerelease of Disney's 'The Little Mermaid' now retails for $14.87 at Wal-Mart and $14.99 at Target. The movie can be bought for $12.99 on iTunes."

Re:Huh??

[Jonny_eh]

Bandwidth and server maintenance costs too, albeit not nearly as much as DVD packaging/shipping. Or does it?

And the point is?

[frovingslosh]

The two-disc rerelease of Disney's 'The Little Mermaid' now retails for $14.87 at Wal-Mart and $14.99 at Target. The movie can be bought for $12.99 on iTunes.

So for $14.87 you can get 2 already made discs at Walmart, in a nice storage case, with plenty of extra bonus material, that will play on any (region 1) DVD player, or for less than 2 dollars less you can spend your own bandwidth to deliver a copy to you, and provide your own packaging and media, that contains only the movie, is of a much poorer quality, has a DRM infestation that will keep you from using it where you want to use it, and eventually you will not be able to play back on the system you want to play it back on. If you buy the Wal-Mart version you ratain right of first sale and you are free to resell it if you want, or lend it to friends, or even give it away. If you have the downloaded version you can't legally do any of these. And somehow Wal-mart wants to claim that this alternate outlet puts them at a disadvantage? I'm sure they would like to have a complete monopoly of distribution, but any argument that cheaper on-line sales unjustly undercuts them is completely bogus, and if anything it might even improve their sales when the on-line mark realizes what a bad purchase they made. It certainly makes the Wal-mart price for a couple of mass produced and packaged discs look like a great deal in comparison to on-line pricing.

Re:Finally, a taste of their own medecine

[hcob$]

well, with the itunes versions being on DRM lockdown, and dvds being able to be played on any dvd player they (B&M retailers) should market against itunes and the likes by mentioning that fact. Join us in the fight against DRM people! I would pay an extra dollar per DVD if they would help fight them.

Silly me, I thought that DVD's were DRM'd(encrypted). But a fallicous argument never stopped the US Consumer from listening.

Re:Huh??

[nine-times]

And a video with lower picture quality and audio quality than the DVD, with no DVD extras, etc. But you know what? And what's with the threat, anyway? "If you take an action that might possibly hurt our DVD sales business, we'll cut ourselves out of the DVD sales revenue completely!" If I were the movie studio, I'd call this bluff.

Re:Huh??

[shmlco]

Disney said they sold 125,000 movies on iTMS the first week, which works out to be roughly 150,000 GIGABYTES of data transfer. Plus having the servers to process transactions and deliver said content in addition to the TV shows and songs already there.

I'll submit that building and maintaining the infrastructure to deliver that much paid content in a timely and reliable fashion is not cheap.

And that's just the first week...