According to Broadcasting & Cable Magazine, the Children's Advertising Review Unit of the Council of Better Business Bureaus has asked Disney to stop marketing the PG-13 'Pirates of the Caribbean: Dead Man's Chest' to children on Nickelodeon.

A self-regulating arm of the ad industry, CARU made a formal complaint about ads that ran in tandem with the film's theatrical release in June, three months after they had aired. Disney responded by saying they had no plans on rerunning the ads, and stated that they had relied on Nickelodeon's clearance department to ensure proper ad placement.

CARU frowns on advertising PG-13 films to children under 12 because the MPAA rating indicates the presence of content that "may be unsuitable." However, as the B&C notes, 'Pirates of the Caribbean' toys, games, food and a whole bevy of other licensed products are heavily marketed to children despite the film's rating.

It will be interesting to see how close and timely CARU's scrutiny will be when Disney launches the third installment of the franchise next year, and what changes Disney will make regarding ad buys on younger-skewing channels. As reported for Q3 2006, the Disney Consumer Products division’s income rose 70% over the previous year to $105 million, much of which was due to sales of Pirates-themed merchandise.

In a special presentation yesterday, Apple CEO Steve Jobs unveiled the new iTunes movie store, which will enable users to buy and download feature-length films.

The initial slate of 100 movies includes an offering of titles from Disney-affiliated labels Pixar, Miramax, Touchstone, as well as Disney-branded films. A forthcoming deal with Lionsgate is expected, but was not announced during the presentation. The films will be priced at $14.99 for new releases and $9.99 for catalog titles, but customers who pre-order new releases can order them for $12.99. The video files will use the H.264 codec and will be at 640 x 480 resolution, which is “near DVD” quality and suitable for viewing on standard TV sets.

Apple also gave a sneak preview of a new product tentatively called “iTV,” which is a set-top box that will enable users to stream downloaded movies, music, and photos from a computer to a consumer’s television set. The wireless box will also have HDMI output, which should be able to address the studio’s piracy concerns. The iTV release date is slated for sometime in 1Q 2007.

When compared to the lackluster release of Amazon’s Unbox service last week, the Apple offering looks like an improvement if they can secure a wider base of content partners. However, the pricing structure for DRM-hobbled, low-quality video without packaging or special features seems too high. For example, for $20 dollars, you can pick up Miramax’s ‘Kinky Boots’ DVD on Amazon, and for that price you will get DVD quality video, Dolby 5.1 sound, two featurettes, deleted scenes, commentaries, and foreign language tracks. You can play it on any DVD player in or out of the home, and if you wanted to, an individual with minimal technical knowledge can rip a DRM-free version to play on their iPod (albeit illegally). Therein lies the real problem: creating a downloadable product that offers consumers the same level of choice for the same price as a physical product, or reducing the price to reflect the true value to the consumer.

Perhaps the recent conjecture is right - maybe the studios aren't interested in seeing downloads cannibalize DVD sales just yet.