Why is there no iTunes for movies? Why is there no legal database that offers as comprehensive a selection of movies as iTunes does for music, all of which can be easily downloaded or streamed for a reasonable price?
The answer lies in the outdated contracts the major studios have with distributors, cable channels and telecom companies:
The best way to understand it is to trace what you might call the life cycle of a Hollywood movie, as Starz network spokesman Eric Becker put it to me. We all understand the first couple of steps in this life cycle—first a movie hits theatres and then, a few months later, it comes out on DVD. Around the same time, it also comes out on pay-per-view, available on demand on cable systems, hotel rooms, aeroplanes, and other devices. Apple’s rental store operates under these pay-per-view rules, most of which put a 24-hour limit on movies. The restriction might have made sense back in the days when most people were getting on-demand movies in hotel rooms and the studios didn’t want the next night’s guest piggybacking on rentals. It doesn’t make much sense when you’re getting the movie on your MacBook. But many of the contracts were written years ago, and they don’t reflect the current technology.
A movie will stay in the pay-per-view market for just a few months; after that, it goes to the premium channels, which get a 15- to 18-month exclusive window in which to show the film. That’s why you can’t get older titles through Apple’s rental plan—once a movie goes to HBO, Apple loses the right to rent it. (Apple has a much wider range of titles available for sale at $15 each; for-sale movies fall under completely different contracts with studios.) Between them, Starz and HBO have contracts to broadcast about 80 per cent of major-studio movies made in America today. Their rights extend for seven years or more. After a movie is broadcast on Starz, it makes a tour of ad-supported networks (like USA, TNT, or one of the big-three broadcast networks) and then goes back to Starz for a second run. Only after that—about a decade after the movie came out in theatres—does it enter its “library” phase, the period when companies like Netflix are allowed to licence it for streaming. For most Hollywood releases, then, Netflix essentially gets last dibs on a movie, which explains why many of its films are so stale.
So why don’t the studios just sign new deals to put their movies online? Money.
[T]heir current deals are worth billions, and a new plan would mean sacrificing certain profits for an uncertain future. Understandably, many are unwilling to take that leap.
Until Hollywood gets its act together and moves its films online, all we can do is accept their limited offerings and outdated rules—or turn to BitTorrent.
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