Apple's iTunes sells movies in U.S. on DVD release date

Apple Inc. announced Thursday that it is allowing U.S. customers to purchase films from its iTunes website on the same day they are released on DVD.

The introduction of the new service represents a shift for the major film studios, which previously had waited as much as 30 to 40 days after DVD distribution before offering new releases to the majority of video download services.

But Apple said it has partnered with most of the studios for its new offering, including 20th Century Fox, Disney, Warner Bros., Paramount, Universal and Sony Pictures Entertainment, as well as Lionsgate, Image Entertainment and First Look Studios.

Apple shares rose 2.5 per cent on the news, up $4.21 to $178.16 US as of midday in Nasdaq trading.

The service will allow US visitors to buy new release films for $14.99 US and older library titles for $9.99 US.

The announcement comes just three months after Apple announced users would be able to rent new release films through the iTunes store for $3.99.

New releases, however, are not yet available to customers in Canada through iTunes.

The decision by studios to allow users to either rent or own new release films could put added pressure on bricks-and-mortar retailers such as Blockbuster Inc.

Apple's announcement confirms that the other major studios are in step with Time Warner, whose chief executive, Jeff Bawkes, said during a conference call on Wednesday that the company's Warner Bros. studio would begin releasing movies for video-on-demand systems the same day they are released as DVDs.

That decision could open the door not only for online retailers like Apple and Amazon.com, but also spur use of cable pay-per-view systems or rental download systems like Apple TV.