Apple to Rent Movies… Finally

Dave Zatz —  December 28, 2007

The Financial Times reports that Apple and 20th Century Fox have inked a deal to offer movie rentals. In order for this development to be meaningful, two things have to happen:

  • Implement on-box Apple TV ordering
  • Round up additional studios

I see both as inevitable – it’s just a question of timing. Most studios haven’t shied away from renting digital movies (see: Amazon Unbox, Xbox 360, CinemaNow, Vudu, etc), the sticking point will be negotiating the revenue split and customer rental terms with Apple. As we know, Apple TV hasn’t exactly set the world on fire… Taking the computer out of the equation to allow couch-based online ordering would subtly but significantly change the experience. For the better.

So now that we’ve covered the obvious, let’s discuss the more interesting news:

Apple will also for the first time extend its FairPlay digital rights management system beyond its own products. A digital file protected by FairPlay will be included in new Fox DVD releases, enabling film content to be transferred or “rippedâ€? from the disc to a computer and video iPod.

Sounds a lot like the Harry Potter and Die Hard bonus digital files, doesn’t it? However, instead of being protected by Microsoft’s DRM-ed WMV, these Fox films will be protected by FairPlay. Which is much more meaningful given the sheer number of video-capable iPod/iPhone units floating around.

7 responses to Apple to Rent Movies… Finally

  1. Apple TV is the #1 selling media extender (most people use the “media extending feature” of something else like a TiVo or XBOX) and commands the lions share of purchased movie downloads at 42%, and over 90% of purchased television downloads.

    I think that the studios will try to kill this cat before it gets out of the bag.

    I hope that enough iPhone/iPod Touch owners showing off video rentals on the go will make Fox too much money for the other studios to ignore.

  2. You know, I really want to want an Apple TV, but right now I don’t. AudioFaucet on Tivo and an Airport Express cover me for my living room audio streaming.

    Here’s what would make me jump for AppleTV:
    1. Video downloads from box
    2. HD video in iTunes Store (like xbox)
    3. Dashboard widgets

    Throw in some DVR functions and I might even line up a the Apple Store for v.2.

  3. You can rent movies on the xbox 360

  4. My self, I’m not so sure ordering from the device is a necessity. I never use it on my tivo, I always do it from a computer… and everyone I know with iPod touch/iPhone never uses the itunes store on the device… they just use it from a computer. That said, since they just added it to those two devices, I think it’s a safe bet that it will be coming to the apple tv.

    I really think the biggest downfall of the device is that it only works on HDTVs, but you can’t buy HD content. So either it won’t work on you TV, or it’s like buying a VCR for your HDTV.

  5. Dan, for a tech savvy crowd like we have here on ZNF, lack of on-box ordering isn’t a deal breaker. But for Apple TV to be a commercial success and take on the cable or satellite boxes for VOD, I believe it’s a necessary feature.

    I also agree that the lack of true HD content dissuades the more tech savvy. But thinking again about the mainstream audience needed for commercial success, Apple can get by with sub-HD content a little while longer. Especially given the huge file sizes and lengthy download times associated with HD.

    Large libraries like Amazon Unbox and are tedious to navigate using a typical remote. The innate slowness of HME apps on TiVo doesn’t help matters. The Vudu scroll wheel is more efficient and it has a faster interface. But I still think the UI experts need to get together (at Apple, TiVo, wherever) and rethink the 10′ interface given boatloads of content we’re going to need to filter.

    Peter, yep. Xbox 360 video downloads are pretty good. The library is limited, but the quality is good (even SD) and ordering is efficient. They also need to rethink how the present their content offerings though.

  6. Okay, so I buy/rent a Paramount DVD in order to watch the movie on my iPod. I transfer the special mpv file to the PC and add it to iTunes, then sync. Now I have a limited rental window either from when I start watching, or when I transfer it or whatever.

    Obvious problem… the unaltered file is still on the DVD. So I could copy it again if I wanted.

    I understood that this was just a download bypass, i.e. you would still need to “buy” a license to play the file via iTunes online, meaning it will cost money on top of what you paid to buy/rent the DVD in the first place.

    Might be a deal breaker. Depends on how much and how well all this is integrated. If I have to be online, use a PC, and pay again anyway, why wouldn’t I just download it in the first place? If I’m putting it on my iPod I’m probably NOT going to watch it right now, but rather queueing it up for later.

    Like you say, this will all make sense when they offer a good GUI, direct purchase/downloads from a device like the Apple TV, etc.

    And hey, I’m not sure a 6-8Mbps 720p download is that crazy…

  7. Hmmm… interesting angle to percolate on. What makes you think the DVD FairPlay file would have an expiration date? That wasn’t my assumption. Though I could imagine them linking each file to an iTunes account to prevent everyone who Netflixes it from having a personal digital copy.