On September 12, 2006, Apple introduced iTunes 7, with the ability to purchase movies from the iTunes Music Store. In a confirmation to swirling rumors, Apple launched with only Disney as a provider of movies, and only with 75 movies in total.

In two months, no other studios have been added to the roster, yet every TV studio under the sun is represented there. On September 7, Amazon launched unbox, with over 30 studios and networks, basically everyone but Disney. While no figures have been released for unbox, it appears to be a huge failure. Contrary to unbox, Disney sold 125,000 movies the first week through iTunes, worth more than $1,000,000. Recent figures indicate this rate has slowed a little bit, but huge hits such as Cars and Pirates should increase the trend again. Disney estimates they will do $50,000,000 in sales of movies alone on the iTunes store.

So, $50,000,000 for a couple of hours of work on each film to prep them for the library, and that is the first year only. So, where are the other big studios? Of the top 20 grossing movies of all time, none of them are currently available for sale on iTunes, though Dead Man’s Chest will be added when it is released in December. Despite Apple’s hard line contract for studios, there is no way the studios could be looking at this and dismissing it. This is free money basically, no DVD pressing costs, no marketing expenses, nothing. Where do I sign up?

It has been rumored that both Fox and Lion’s Gate are in negotiations (I believe all the studios are in some sort of negotiations, whether it has been leaked or not), though it has been estimated their catalogs will not be available until sometime in 2007.

Hmm, 2007, arrival of iTV (hopefully to experience a name change at birth) as well as the long rumored iPod touchscreen. Two items focused on movies, but with only Disney in the fold, these two items become less attractive to the average consumer. When Apple launched movies on iTunes, there were reportedly three studios involved, though two backed out due to others not joining. Disney was left at the table, alone. What could Apple give Disney to convince them to sign up? How about exclusivity? Disney puts out a little cash to get 75 movies ready, and they wait to see how things go. First week, a cool million.

Disney has exclusive right to sell movies on the iTunes store, no doubt about it. How long it will last (can’t be more than 4 - 6 months), I don’t know. With the release of iTV and the touchscreen iPod in early 2007, that will mark the end of the Disney only movies on iTunes, and we will see a flood of other companies come online with Apple. Keep your eyes on MacWorld San Francisco, January 8 - 12, 2007. Looks like Disney got about 120 days all to themselves.

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