Disney sells 125,000 movies through iTunes
Yesterday, Walt Disney Co. (DIS) CEO Robert Iger told a Goldman Sachs (GS) investor conference, Communacopia that the company has sold 125,000 movies through Apple (AAPL) iTunes store, generating a revenue of $1 million. Considering that with just 75 movies and in a single week, this is a smashing result. Iger also expects iTunes movie downloads to generate revenues of $50 million in the first year. This is a significant number and is worth noting as other Hollywood studios may find this kind of revenue hard to resist. Iger also expects to increase the number of digital content offerings as licensing issues are sorted out.
Amazon (AMZN) has not revealed how its service, Unbox has fared. Compared with Unbox, Movielink and other services, Apple may have the best digital distribution network of all. So we can expect relations between movie studios and Apple to warm up and start discussions. It is not clear how revenue is shared between Apple and Disney now. But from past behavior, Apple may not lose too much money on bandwidth costs, which is a major cost in digital distribution.
All this is happening without Apples's iTV or any clear solution to transfer content from a computer to TV. If iTV provides a simple and effective solution to this problem and convince consumers to use it, then Apple will get more leverage over other movie studios.
Iger made another comment about overhauling Disney.com and relaunching it. Although he did not elaborate on this idea, Disney may be creating various channels of entertainment, in the style of YouTube in a move to use Disney.com to deliver digital content or redirect visitors to iTunes.
posted by Hari @ 9/20/2006 01:21:00 PM
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