Cinematical

Last week I attended the Macintosh love-fest known as Macworld Expo and was one of the thrilled spectators at the infamous keynote where Apple honcho Steve Jobs told us all about the new iPhone and Apple TV. As I looked around the crowded room I noticed several people that I recognized -- including a couple of TV execs and Disney CEO Robert Iger.

At the time, I also wondered at the absence of other movie studio execs. Usually, when Jobs announces something big, as he did with the iPhone and its deal with Cingular, he brings out a bigwig from the company in question to talk about it and say how great it will be working with Apple -- as he did with Cingular CEO Stan Sigman.




So, I found it strange when Jobs announced that Paramount was joining Disney and allowing movies from the studio to be sold on iTunes and nobody from Paramount came out and say anything. In fact, when I approached some people I've known for years who work at Apple and asked them what the deal was, I was told that most of the "Hollywood types" had chosen to attend CES instead of Macworld. At the time, that answer seemed to make sense. Later, after thinking about it more, I wondered if Hollywood's absence was somehow deliberate and maybe even meant to send a message to Apple and Jobs? Well apparently, according to this article over at Business Week, it wasn't really CES that kept Hollywood away from Apple and Steve Jobs's keynote -- it was money.

In the article, the author asks the question "What does Hollywood want from Steve Jobs?" The answers are not too surprising. First, they want more protection for their films. They don't like Apple's digital right management (DRM) scheme and think its far too liberal to allow users to share their movies with as many as three other iPod users. In their ideal world, execs feel that users should pay separately for each device they watch movies on and this would be controlled by a more restrictive version of DRM -- something that Apple has, so far, refused to implement.

Even more importantly, Hollywood execs think that Jobs and iTunes charge too little for their movies. At iTunes, new movies are $14.99 and older ones are $9.99, in clear competition with stores like Wal-Mart and Target which sell titles for several dollars more. Naturally, both Wal-Mart and Target are not very happy about this and have made their feelings known to Hollywood execs who, of course, need to listen to these giant retailers -- especially as a major part of their profits are from DVD sales at these stores.

In spite of all the issues and problems, I feel certain that at some point Jobs and Apple will win over the studios just as they did with the music industry. It won't be easy but Jobs has an uncanny ability to take ideas that most people balk at and turn them into business gold. He did it with the iMac, the iPod and iTunes, he can do it with the movie studios and selling movies online too. Although, with increasing competition from Microsoft and others online movie sellers, he better hurry it up a little.