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Wednesday, November 29, 2006, 08:55 am PT (11:55 am ET)

Movie studios want new "anti-piracy" model from Apple

Amid growing concerns over digital piracy, major motion picture studios are pressuring Apple Computer to develop a new distribution model for digital films before they agree to make their flicks available on the company's iTunes download service.

The studios — Universal, 20th Century Fox, Paramount and Warner Bros — are all in talks with the iPod maker, according to the Financial Times, but are demanding that company limit the number of devices that can use a film once it's purchased and downloaded from iTunes.

"The studios want to avoid the experience of the music industry, which has yet to recover from years of illegal digital piracy," the report states. It quotes one studio executive involved in the talks as saying Apple must introduce a "new model" for feature film content delivery.

With the average cost of a blockbuster film approaching $100m, movie studios have more to lose than music companies, the exec said. "We’re very willing to do a deal but we’re keen to get some concessions from Apple that will account for the differences between the value of music and television content and feature film content."

Thus far, Apple has signed on just one major studio in Walt Disney Co., which joined iTunes in September and has since sold over 500,000 flicks through the service — a sell-through rate of approximately 62,500 movies a week or 9,000 each day.

Of the four motion picture heavyweights yet to ink a deal with Apple, Fox is rumored to be one of the closest to reaching an agreement to join iTunes. Earlier this month, CNN quoted the president of the studios parent company, News Corp., as saying the two parties were engaged in 'positive talks,' but that several details still needed to be worked out.

Lions Gate Entertainment, an independent, is also rumored to be closing in on a deal to distribute its films through iTunes.