iTunes To Have Movie Downloads This Month

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Rumors have been swirling for weeks (see here and here) that Apple will soon be selling full length movie downloads on the iTunes service. This morning, Business Week is stating, based on unnamed sources, that the service will launch by mid-September.

And adding color to the story: WalMart is pissed off.

Apple is pushing for, and apparently getting, $14 wholesale movie prices on new releases. They plan to retail new releases for $14.99 and older movies for $9.99. Normal wholesale DVD prices are $17. Walmart pays that normal wholesale rate, and now anticipates losing a significant share of their 40% market share in the $17 billion annual DVD market. Given that it will be trivial for iTunes users to simply burn a DVD of these movie downloads, Walmart has good reason to be worried. Netflix should be nervous, too.

Look for the initial announcement to only include movies from Walt Disney (Apple’s Steve Jobs is Disney’s largest shareholder), and possibly Fox and Lions Gate.

Note that Amazon may also soon have its own movie download service.

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