If You Buy Movies on iTunes, Apple Loses Money
The announcement came yesterday that Apple would begin selling movies via iTunes on the same day they are released on DVD. Today, news came down that Apple is apparently losing money on the deal - Team Fruit is paying around $16 per movie, and only charging customers $15 for new releases. Yeah...let that sink in... If this insane business practice is allowed to continue, Fruit will soon face a rather difficult decision - charge its customers more, or renegotiate with major movie distributors. Option A is absolutely absurd, as any person can often walk into a Best Buy, Wal-Mart or other retailer and buy a new release for less than $15. While Option B would seem most palatable to both Froot Loops and its customers, Toucan Steve will likely need to prove that iTunes can move product as well as a major retailer to convince studios to slice him a discount.