The iTS and Movie Rentals

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By JLMoran
November 13, 2006

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I've been thinking a lot about the iTS and their recent movie offerings. As I've noted and others in various reviews have noted, the current price to buy a movie via the iTS just isn't competitive with regular DVD offerings, and the tradeoffs (lower-quality image, poorer sound, no bonus features) make it even less compelling.

There have also been questions about why there's no rental option such as what Amazon's Unbox service offers. I have to agree that this would be a lot more compelling. I just got my latest "video spotlight" e-mail from the iTS, and in the newly added movies list was "The 13th Warrior". Now, this is one I'd never seen but actually wanted to see, mainly because I'd heard decent enough comments on it from people that I figured I'd at least moderately enjoy it.

No way in heck was I going to pay $10 or $14 to download and own it. But what if, right when I saw that there in the listing, I could have gone to the iTS, selected that title, and clicked on a "Rent this Movie" button instead of a "Buy this Movie" button? They'd have had me instantly, from the moment I read that e-mail.

So why the heck doesn't Apple offer this? Well, part of it probably has to do with studio negotiations. But I think a bigger part has to do with end-user experience. Most movie rentals aren't solo affairs (at least for the kind of movies available on the iTS ;D), and you really don't want to watch them on your computer. You want to crank that up in the living room, kick back with your better half and/or the kids, turn down the lights, munch some popcorn, and have a family time of it.

Now, how do we get an iTS movie off the computer and onto the living room TV? Oh yeah. That iTV gizmo that Apple talked about a couple short months ago. But wait, that's not coming out until January at the earliest...

So my thinking goes like this:

1) An iTV announcement at MacWorld by itself is no biggie. Everyone knows it's coming.

2) To give it more "umph", Apple announces the availability of movie rentals as well as purchases from the iTS. Just sit on your couch, fire up the iTV, access the iTS from there, and rent the movie you want. The dream of on-demand movie rentals taken to the next level.

3) To give that more "umph", Apple gives a pricing scheme competitive with NetFlix, and announces deals with at least one other major studio (all signs point to 20th Century Fox coming on board, but maybe they'll also snag Time-Warner or Universal).

Now here is how I'd like to see such a rental service work, which would give it the final "umph" and potentially help drive it as the new stanadrd of movie rental services:

Pricing: Should be competitive with services like NetFlix or my local Hollywood Video. And by "competitive" I mean slightly cheaper, since there's no mailing costs or "old school" distribution costs involved. If I can rent unlimited movies per month (max of 3 checkouts at one time) from either service for $17 or $20 a month, I should be able to do the same via Apple for $12 to $15 a month (maybe even slightly less if the catalog remains fairly small).

Availability: Make it work like NetFlix. I build a queue of movies I want to watch. The first 2 or 3 titles download to my hard drive, ready for viewing. As I watch them and elect to "return" them, they get cleared out and new ones get downloaded.

Rental Period: Again, make it work like NetFlix. It sticks around until I've watched it at least once. At that point, give me a "return video" button that I click to wipe that video off my hard drive and start downloading the next one. I'm free to watch them as my schedule allows, and never have to worry about mailing anything back or making a trip to a store to drop off the DVDs. Until I choose to return it, I can watch it again and again. I just can't download something new in its place (and I continue paying monthly rental subscription fees) until I take that movie off my hard drive via that "return video" button.

DRM: Yes, this will require DRM. Such a download cannot be burned to DVD as a backup, although it should be transferable to an iPod for watching there (and such a transfer cannot be copied back to a different computer, as you can do now with regular music and movie/TV purchases).

Ownership: This could be the kicker, especially for those who might consider buying a movie this way. After renting the movie, in addition to the "return video" button, iTunes also presents a "Buy to Own" button. Click this and the movie is instantly re-DRM encoded as a regular movie purchase. You can then back it up to hard disk / DVD, your iPod can sync it back to other authorized computers, etc. The purchase price would be discounted to reflect that you already paid a rental fee for it, giving you an incentive to buy after trying it out.

Think about that last one a bit. I mentioned my interest in "The 13th Warrior" earlier. What if I rented it this way, and after watching it I found that it was surprisingly good; so much so that I'm pretty sure I'd watch that again. Or a more realistic scenario (given that Antonio Banderas isn't exactly my idea of stellar acting ability): I rent the latest kid flick for my young'uns. They keep watching it over and over again, never getting tired of it. I'd like to watch something new, thanks, so I click the "Buy to Own" button, get it permanently added to my collection, and move forward with new rentals.

So those are my thoughts. What do you think? Any meat on them bones, or have I been drinking too much of the Earl Grey again?

- Joe -

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