MacWorld 2008: Movie Rentals and iTV

MacWorld 08 was predicted by the media fairly accurately for the most part. The outlandish hopes of an iCar and the less probable ones of an iTablet did not materialize, but movie rentals, iTV and iPhone updates and an ultra-portable notebook were all highlighted. It's the latter that gets the most attention so in this article I focus on what movie rentals and iTV mean -- and what I hope Apple is leading up to.

Recently I had the joy of wanting a movie. Not one of the three I had sitting in Blockbuster mailers in my house, but a spur-of-the-moment choice. So, I bundled up for the midwestern chill, drove to the store (carefully avoiding the ice on the roads) and looked for a movie. Already having used my monthly free rental coupon, I plopped down $5 and took my movie home, watched and enjoyed it. A few days later I repeated the process, but this time just to return the movie. Apple realizes that I'd rather not have done any of that. And that as a Mac-owner Netflix and Amazon's streaming movie rentals aren't compatible with my computer so I had no other options. Enter iTunes movie rentals!

The newest update to iTunes will have a variety of pricing options depending on whether I want to watch an old favorite or the latest release. They will even have 10% of their new lineup available in HD. The prices are affordable (more affordable than my Blockbuster trip), ranging from $2.99 (older titles) to $4.99 (HD new releases). Customers have 30 days to watch any video they choose and can stream it or download it. (Though if you start it, you must finish the movie within 24 hours.)

What's big about this announcement is that all the studios are on-board -- even GE's Universal which recently balked at contract negotiations. Forbes recently discussed the reasons studios have been reluctant to rent videos online (fear that it will cut into overall DVD profits), but Jobs has convinced them that iTunes can do for video what it did for music. Consumers are thrilled because it offers them convenience at a reasonable price.

iTV, an Apple poor seller, has been revamped -- now it connects directly to the iTunes store, finally marking it as an easy way to watch your favorite movies in comfort and not crammed around your computer. While it isn't meant to compete with TiVo (no tuner), this will probably boost sales of both iTV and iTunes movie rentals. As Gizmodo notes, the iTV does much more than just stream video: it deals with music, podcasts (though this I'm really not sold on) and photos. The latter will come in handy for those regretting the demise of vacation slide shows.

How will this service compete with Netflix, however? I suspect I will use it mostly when I just need that occasional rental; it's hardly cost effective to do regularly. Unless I canceled my Blockbuster subscription (just raised to $20/month) and rented 4-6 movies a month instead. Many people may begin doing the math since if you don't rent often, this is a much better deal. What most of us would like to see, though, is an iTunes rental service. Will it happen? It isn't Jobs' thing, but neither were cell phones.

What I'd love to see, though, is Netflix partner with Apple. If iTV could access both Netflix' live streaming (which is limited in the number of movies it offers) and its current features, life would be grand. Though, it would kill this rental service.

The other thing lacking iTunes lacks is an upgrade plan; if you rent a movie and love it, why not offer a $4 discount on the purchase price (especially since the computer is already on your hard drive potentially)? I can't imagine that Jobs hasn't thought about this, so look for an update in a few months.

Jobs has once again set up a great confluence of products, but here I think the model still needs to be tweaked. Wish list? Rental service, upgradable. Then I'd cancel Blockbuster/Netflix in an instant!