Stock Option Investment Advice

Fox Movie Rentals through Apple’s iTunes Music Store

Apple (AAPL) and News Corp. (NWS) have signed an agreement to offer Twentieth Century Fox movies for rent through the iTunes Music Store, the Financial Times reported Thursday.

Users would be able to download the latest Twentieth Century Fox movies from iTunes and view them for a limited time. No pricing details were available, but earlier reports suggested that Fox and Apple were talking about charging $2.99 for 30 days viewing. That’s considerably cheaper than competing services from BlockBuster (BBI) and NetFlix (NFLX), neither of which works with iTunes, Macs or iPods.

Signup now for PowerOptions free 14-day trial

As part of the agreement, Twentieth Century Fox will use Apple’s FairPlay digital rights management technology in future DVD releases, marking the first time someone other than Apple has used the technology, the report said. Using this technology would allow users to copy movies from a DVD onto an iPod, it said. In a related move, Fox also plans to release DVDs that use Apple’s digital rights management system, a move that would allow consumers to make legal copies of the disc that could be played on an iPod or other device, such as a computer.

Signup now for PowerOptionsApplied 30-day risk free trial

The deal between Apple and Twentieth Century Fox will “likely” be announced on January 14 at the Macworld conference.Besides Twentieth Century Fox, Apple has been holding similar talks about online movie rentals and FairPlay with Sony Pictures Entertainment, Paramount and Warner Bros.. Until now, no studio has agreed to such a deal with Apple, and some companies have continued to resist Apple’s pitch.

Apple already sells movies from some studios via iTunes, which consumers can keep permanently. Walt Disney Co. – where Apple chief executive Steve Jobs is a large shareholder and board member — sells both new releases and catalog titles. Some others, such as Viacom Inc.’s Paramount Pictures, sell only older movie titles through iTunes.

Now, rentals could help Apple energize its online video efforts by giving consumers more options for accessing movies. Sales of video through Apple’s iTunes Store have failed to grow at the same pace as the site’s music downloads, analysts say, while the company’s video device for living rooms, Apple TV, has been a poor seller.

Stock Analysis:
Analysts were divided about what impact the Apple-Fox deal would have on the $9 billion U.S. movie rental business, which has seen steady declines in in-store rentals and slowing growth online in the past year.

The partnership would be beneficial to Fox, as a way to increase distribution of titles it releases to DVDs and to Apple to expand its product offering on iTunes. Both Fox and Apple have seen an increase in its share price.

Where as, the reports sent shares of Netflix Inc, a leading online DVD rental company, and Blockbuster Inc, the largest U.S. movie rental chain, down nearly 5 percent in morning trade. Shares of Netflix were down 4.5 percent, or $1.29, at $27.41 on Nasdaq. Shares of Blockbuster were down 4.8 percent, or 20 cents, at $3.98 on the New York Stock Exchange.

Covered Calls:
Prudent investors are always looking for stock market tips, and the following covered call investing positions were found for Apple using PowerOptions search tool.

PowerOptions covered call search
Option Strike
AAPL 199.83 (+1.26) APVAS 08 JAN 195.0 (22) 11.65 5.8 3.6 3.6
AAPL 199.83 (+1.26) APVAT 08 JAN 200.0 (22) 8.95 4.5 4.7 4.8
NWS 21.29 (-0.21) NWSBD 08 FEB 20.0 (50) 1.7 8 2.1 2.1
(For more details click the ticker symbol above)

For more information about how to identify and research great option trades, visit the PowerOptions website. There you will find the data you need to make quick, clear, and informed decisions. You can trade knowing you have found the best investment. Also, PowerOptions will allow you, with a few quick clicks, to quickly and accurately compare trades. PowerOptions‘ premium customer support is second to none in the industry. They can be easily contacted when you need them at their toll-free number to answer customer questions. Call them now toll free at 877-992-7971.

PowerOptions provides a free 14-day trial of its service. So join PowerOptions today, and you too can start reaping the benefits of the covered call investment strategy.

PowerOptions‘ sister company PowerOptionsApplied provides expert stock option trading recommendations. PowerOptionsApplied specializes in covered calls, naked puts and iron condor stock options strategy recommendations. PowerOptionsApplied provides a 30-day risk free trial of its service.

[tags] Twentieth Century Fox, iTunes, Financial Times, Macs, iPods, FairPlay, Sony Pictures Entertainment, Paramount, Warner Bros., Walt Disney Co., Steve Jobs, AAPL, Apple Computer Inc., BBI, Blockbuster Inc., NWS, News Corp. Ltd. (The) Class B, covered call investing, covered call investment strategy, investment strategy, iron condor, poweroptions, stock market tips, stock option trading, stock options [/tags]

Leave a Reply

Your email address will not be published. Required fields are marked *