The leaders in online retail and music will have to watch their backs as they charge into the film download market. Web-habits are changing, and it seems certain that the hugely popular social networking sites will play a major part in selling all forms of online content from now on.
This could be especially true in niche markets where online “word-of-mouth” moves units. Moreover, the current vogue in e-commerce says there are big profits to made from the back catalogues of less-popular titles – the so-called “long tail” effect.
From this perspective, Apple looks to be in a poor position. Amazon’s Unbox system has 30 content partners. Next week Apple is expected to announce a deal with only Disney – the only major studio not to partner Amazon – after losing a battle to lock the rest of Hollywood into its preferred flat-pricing structure. Apple’s tail will be a lot shorter as a result.