Picture-In-Picture with a transparent alpha channel

I have previously been able to create sidebars for my YouTube projects, with artwork on the left and right, while the center of the graphic is transparent.

I just upgraded iMovie though, and now I can't do that! I import the image into iMovie, and the alpha channel is now white... completely covering my video in the center!

Will someone please tell me what I'm doing wrong, and how to fix it? It's driving me crazy, and I have a video waiting to be published!

Thanks!