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Apple's (Nasdaq: AAPL) 
iTunes store has been stocking up on film titles in recent months and has now added selections from film studio
Lionsgate to its roster.
Lionsgate, an independent studio based in Santa Monica, Calif., has a catalog of more than 10,000 titles, mostly obtained through a series of film library acquisitions. About 150 Lionsgate films will be made available via iTunes this month, the companies said.
The deal gives the iTunes movie selection a much-needed boost, bringing its total number of offerings up to 400. However, the number of titles is still far behind industry leader Wal-Mart's (NYSE: WMT) newly launched video service, which offers more than 3,000 titles.
Wal-Mart Leads the Charge
In a slightly ironic twist, says Forrester Research Analyst James McQuivey, it was Wal-Mart's recent announcement it was going to offer online movie downloads that paved the way for Apple.
"No one wanted to upset Wal-Mart," McQuivey told TechNewsWorld. "But their announcement has freed up every studio to work with Apple and others."
More to Come
Lionsgate now joins Disney (NYSE: DIS) on Apple's storefront. Select Disney titles have been available on iTunes since last October, and last week it was reported that 1.3 million movies have been sold through the service.
Viacom (NYSE: VIAb) also announced a deal with iTunes last month. More than 100 titles from the studio's Paramount Pictures, Paramount Classics, MTV Films and Nickelodeon Movies units are now available through the service.
Many more studios are likely to move into the game, predicted Forrester's McQuivey, but the movie-download format won't really explode until 2011.
"That doesn't mean it is not worth getting into right now," he said.
Technology Barriers
Right now, though, there are a number of technological barriers holding the industry back, McQuivey acknowledged. For starters, the process of moving video from the PC to a 50-inch plasma TV in the living room is too complicated for many casual users.
"If you are going to spend (US)$14 or $15 for a download, you want to get the full experience," he said, which means having the capability of easily transferring the movie to the television.
Another obstacle is the lack of bandwidth -- from both the carrier and individual user perspectives, McQuivey pointed out.
Price Changes
For now, Apple sells catalog films for $9.99, similar to the price set by many DVD retailers. New releases on iTunes go for $12.99 during the first week and then increase to $14.99.
In the past, some studios have shied away from signing download movie deals with iTunes because the company refused to pay wholesale DVD prices for downloads. However, that appears to be changing along with other evolving pricing models.
Now Showing
Following Tuesday's announcement, iTunes customers will have the chance to buy Lionsgate films such as "Terminator 2," "LA Story," "Basic Instinct," "The Blair Witch Project" and "Dirty Dancing."
iTunes has sold over two billion songs, 50 million TV shows, and more than 1.3 million movies, according to Apple's latest figures.
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