Steve Jobs' Movie Deal: A Loss Leader For Apple (AAPL)
iTunes' big studio deal announced yesterday? It's going to be an expensive one for Steve Jobs who's taking a loss on each film sold. Some terms from the WSJ: Apple (APPL) is paying $16 to the studios for each new release, and will sell the films to consumers for $14.99.
It's a small price to pay to gain a foothold in the market, but a sign the studios aren't planning to give up the margins they've enjoyed for decades in the traditional home video business.
But it's also a change for in strategy for Apple: While big boxes like Wal-Mart and Best Buy have been happy to use media as an outright loss-leader, Steve Jobs has previously tried to break even or better with iTunes sales.
But here's a question: Did Apple get a better deal than the $17 Wal-Mart pays the studios for new releases on DVD and is Wal-Mart cool with that?


The collective hate towards movie studios and music labels on behalf of consumers is white-hot.
My suggestion would be for these bozos to make it as _easy_ as possible (at a profit, of course) to get content into the hands of those willing to pay.
Apple is piracy's arch enemy: why you fsck with Apple, Stud-bles? Why? Grease the wheels. Let Apple make a fair profit, they're giving consumers a _very_ easy way to buy your junk.
My point is, they should make it _easy_ for Apple to sell the content. That means letting Apple make a little profit. It's that simple.
C'mon in, the water's fine. And it really is just wanter, not Kool-Aid. Peace
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