Apple Computer reportedly in talks for iTunes movie downloads

Apple Computer reportedly in talks for iTunes movie downloads

Apple Computer is on the verge of announcing movie downloads on its iTunes music store, according to media reports coming out of Hollywood on Monday. Apple chief Steve Jobs was apparently closeted with movie studio heads for long hours in an effort to get their nods for launching this service, according to Variety.com.

Such a deal for downloading movies could be stuck by the end of this year, the report said. However price appears to be a constraint. Apple's Chief Executive Officer Steve Jobs wants all movies to be priced at a general rate of $9.99 per download, while some studios apparently want a range of prices that run up to $19.99 per download.

"We can't be put in a position where we lose the ability to price our most popular content higher than less popular stuff," a studio executive close to the negotiations told Variety. "Every studio wants to have broad distribution in digital, and we all know that having Apple as part of that is very, very important."

Earlier music executives also tried to persuade Jobs to allow songs to be sold at a variety of prices on iTunes, but Apple succeeded in thwarting this bid and the songs are still sold at 99 cents apiece. The reason Apple was able to do this is because iTunes commands 80 percent of the music download market.

Observers believe the same thing will happen with the movie downloads as well. But Variety says that Apple could be flexible in the movie pricing. "There are signs Apple may bend, insiders say, and allow price points ranging from $9.99 to $19.99 in order to differentiate older titles from new releases," it said. Apple offers 70 percent of the revenue to TV and music companies and it is thought to be offering the same for studios as well.