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Report: Apple negotiating with Hollywood to put movies in iCloud

by Phil Hornshaw

Apple’s iCloud service allows users to re-download purchased music and apps, as well as store photos and other content on Apple’s servers. Now Apple wants to leverage the service for movies.

That’s according to a report from the Los Angeles Times, which states that Apple is in the middle of negotiations with several Hollywood studios to make it possible for iTunes users to purchase movies and then download them from iCloud to multiple devices, including their computers, iPads and iPhones. The service could launch as early as this year, or in early 2012.

The studios are struggling with declining DVD and Blu-ray sales as the popularity of services such as Netflix and Hulu continues to rise. DVD sales are a big part of what keeps movie studios profitable, so they’re looking towards the next phase in movie sales: digital distribution. The hope is that by distributing movies digitally, and saving them in the cloud using services such as Apple’s, customers will be more likely to buy movies. The digital part takes out the need to own physical media, while the cloud part takes out the hassle of managing digital copies.

Apple rolled out its iCloud service this week, along with iTunes 10.5 and iOS 5, the latest version of its mobile device operating system. The cloud portion of iTunes gives users a lot more options for how they manage their digital content: it allows them to re-download apps they’ve purchased on multiple devices and multiple times, since all those purchases are saved in the cloud, and it allows users to do the same with music. It also facilitates automatic downloads on all a user’s devices. If you buy a song on iTunes on your Mac or PC, iCloud can automatically send it to your iPhone and iPad, so it’s there when you use the device next.

There’s also Apple’s iTunes Match service, which allows users to use iTunes to “scan” their music files not purchased through Apple’s store and then download the matched tracks on other versions. Anything Apple can’t match in its database, it stores in the cloud. This capability requires an annual fee.

All those services could potentially mesh with the kinds of things Hollywood is looking to do. A multi-studio venture called Ultraviolet debuted this week, which allows DVD buyers to access digital copies of the movies they purchase on disc. Those copies can be accessed on connected TVs, PCs and mobile devices. Apple is considering adding its devices to Ultraviolet’s stable, as well, the Los Angels Times report states. The only studio not in on the Ultraviolet venture is Disney at this point.

Adding movies to Apple’s cloud services will definitely be yet another boon to what’s already offered, but one has to wonder what Apple is putting up for the deal. Reports claimed that getting the music industry on board with iTunes in the Cloud and iTunes Match was a tall order for Apple and cost $100 million. Hollywood probably has more to gain from playing ball, but none more than Apple. While the company might allow Ultraviolet to work with its devices, movies purchased through iTunes would only work on Apple devices in order to help push hardware sales, the Los Angeles Times reports. It’d be interesting to find out what Apple is willing to pay in the cloud deal.