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Wed, Jan 07, 2009 - 06:38 PM EST  —  AAPL: 91.01 (-2.01, -2.16%)  |  NASDAQ: 1599.06 (-53.32, -3.23%)

Report: Apple inks online film-rental deal with News Corp’s 20th Century Fox
Wednesday, December 26, 2007 - 08:57 PM EST

"Apple has signed News Corp’s 20th Century Fox studio to a new online video-on-demand service in a deal that could change the way people pay for online film content," Matthew Garrahan and Kevin Allison report for The Financial Times.

"The agreement will allow consumers to rent the latest Fox DVD releases by downloading a digital copy from Apple’s iTunes platform for a limited time, according to a person familiar with the situation," Garrahan and Allison report.

"The Apple-Fox deal, likely to be announced at the Macworld show on January 14, has the potential to transform film distribution. Apart from letting people rent online, Apple will also for the first time extend its FairPlay digital rights management system beyond its own products," Garrahan and Allison report. "A digital file protected by FairPlay will be included in new Fox DVD releases, enabling film content to be transferred or 'ripped' from the disc to a computer and video iPod."

"Apple, whose shares hit $200 for the first time yesterday in intra-day trade, is understood to have been in talks with Sony Pictures Entertainment, Paramount and Warner Bros about making their new releases available on iTunes to buy and rent," Garrahan and Allison report

More details in the full article here.

MacDailyNews Take: This sounds very promising and bodes well for Apple TV, too. Assume this will include Disney, too.

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Dec 26, 07 - 09:02 pm Comment from: iSteve

Jobs should be able to pull a few strings at Disney too...

Dec 26, 07 - 09:06 pm Comment from: Ferf Muckmeyer

Great news. Hopefully these movies will be in true High-def for a change? Hopefully I won't have to trash my existing Apple TV for a second-generation model (but if I do, that's life!) I suspect they'll sign on a lot of studios for this....

...except that shithole known as Vivendi Universal.

fm

Dec 26, 07 - 09:20 pm Comment from: TowerTone

Looks like I'm gonna finally get me one them TVs

Dec 26, 07 - 09:21 pm Comment from: El Guapo

Third!

Dec 26, 07 - 09:21 pm Comment from: macromancer

" enabling film content to be transferred or 'ripped' from the disc to a computer and video iPod.""

It's about time. Just hope its all High Def.

Dec 26, 07 - 09:21 pm Comment from: El Guapo

Caca! Fifth!

Dec 26, 07 - 09:22 pm Comment from: El Guapo

I'm going to bed!

Dec 26, 07 - 09:26 pm Comment from: macbookmad

hmmm...210 by the end of the year?!

Dec 26, 07 - 09:42 pm Comment from: maclover

"A digital file protected by FairPlay will be included in new Fox DVD releases, enabling film content to be transferred or 'ripped' from the disc to a computer and video iPod." you'd think they know that 'ripping' is encoding a file, and since it's already encoded, it can only be transferred.

Dec 26, 07 - 09:55 pm Comment from: MikeK

Sweet. Although, I'm not holding my breath for HD. I'm expecting standard DVD quality without multi-channel audio, but it'd sure be nice to be pleasantly surprised.

Dec 26, 07 - 09:58 pm Comment from: ChrissyOne

All Your Radical Left Wing Movie Choices Are Belong To Rupert Murdoch!!!

(sry, somebody had to say it)

Dec 26, 07 - 10:02 pm Comment from: Ferf Muckmeyer

ChrissyOne, you are a crackup.

Dec 26, 07 - 10:12 pm Comment from: Wake Up

Umm, DVDs aren't High Def people. The article is referring strictly to DVDs. If you want High Def you need Blu-ray for that.

Dec 26, 07 - 10:17 pm Comment from: ChrissyOne

@ Ferf Muckmeyer

You laugh now, but wait until "Sicko" blows up on you right before the Cuba scene. ;P

Dec 26, 07 - 10:21 pm Comment from: TheConfuzed1

Sign me up for the "Ready to Buy an Apple TV" club if this turns out to be true. smile

Dec 26, 07 - 10:27 pm Comment from: Solomon Wilcots

ChrissyOne, please point your crack up.

Dec 26, 07 - 10:28 pm Comment from: Ferf Muckmeyer

As far as the High-Def moniker goes, DVD quality has got to be an improvement over what iTunes movies dish out. Least they can do is go with some kind of upscaling solution that offers better quality. I'm sure we'll hear all about this at the show next month.

And @ChrissyOne, ok, ok, got the message, he he he.

FM

Dec 26, 07 - 10:34 pm Comment from: R2

I hope it's more than Fox and Disney, damnit. I want them all lined up at once. Sony, Paramount, Warner, I want the whole kitten kaboodle announced at Macworld!

Dec 26, 07 - 10:34 pm Comment from: RC

Current videos that are available on iTunes are generally 640x480, while NTSC DVDs max out at 720x480. So don't look for much if any jump in resolution of the iTunes downloads as they're already at near DVD quality. If you want true HD up to 1080p, like the earlier post said, you're gonna need a Blu-ray Disc player.

Dec 26, 07 - 11:17 pm Comment from: numlock

"allow consumers to rent the latest Fox DVD releases"

What about the back catalog? They will need oldies to differentiate their service from the video-on-demand that the cable companies offer. Right now, the only way to get old movies is on DVD. I hope the iTunes rental store can find a way to change that.

Dec 26, 07 - 11:17 pm Comment from: Big G

720p (which is what appletv does right now) is pretty much just as good as 1080. Obviously 1080 is better, but 720 is really good too.

Dec 26, 07 - 11:18 pm Comment from: numlock

BTW, movies I have bought on iTunes look fantastic on my 720p tv via AppleTV. I know they are scaled up, but they do look great.

Dec 26, 07 - 11:41 pm Comment from: Kenty

Microsoft have been doing HD (720p) movie rental downloads on the Xbox360 for a while now, so would be a bit rubbish if iTunes rentals were only standard definition

Dec 26, 07 - 11:47 pm Comment from: MacSheikh

"I want my TV!" - Dire Straits

grin

(Anyone old enough to remember this one?)

Dec 27, 07 - 12:16 am Comment from: LinuxGuyAndMacProdigalSon

Apple has to innovate in a bandwidth starved environment. This is a clever way to expand Apple's business while it prepares for the day that the bandwidth needs are met. Apple will be in the catbird seat when that bandwidth arrives.

And it must be said -- are you idiot analysts and pundits listening -- that Apple TV will be ready, along with its retail channel partners to crank up the business to spectacular proportions.

Dec 27, 07 - 12:16 am Comment from: HotinPlaya

Strange, no mention of AppleTV

Dec 27, 07 - 12:30 am Comment from: TowerTone

The way I understood the article is that as soon as a movie is available for release on DVD, it will also be available online. There is no reason to think it would be in the same resolution (although likely).

You would most definitely need an H-D or Blu-ray player to rip the hi-def version, but for online, Apple will hopefully give you the option of 480p or 720p, speed vs quality, low vs high bandwidth.

I would also expect to see a slow rollout, with quality and selection improving quickly.

Dec 27, 07 - 01:18 am Comment from: 84 Mac Guy

Unlike the other studio chiefs, Rupert Murdock doesn't let something like ego get in the way of making a buck. If Rupert signs this deal, then you know there is lots of money to be made in rentals through iTunes.

How long with the other studio heads put their big-ass egos ahead of consumers?

Dec 27, 07 - 01:46 am Comment from: ken1w

I don't think bandwidth is a huge issue, if Apple's method for delivery includes a queue of movies the customer wants to watch next. Then, iTunes can "pre-fetch" the next 3 (or whatever number of) movies on the list. The rental charge takes place when the customer decides to watch. The customer can go "off-queue" of course, with the understanding that the movie may take a while before being viewable.

Since iTunes deletes movie files after the rental is over, storage space will not be an issue, and any recent Mac can easily download in the background and do other things concurrently. I think Apple and Fox will offer HD rentals as a option, perhaps with a higher price for HD rental versus "standard" DVD rental. Over time, Apple could make the whole HD DVD standards "war" irrelevant for many customers.

Dec 27, 07 - 02:09 am Comment from: coolfactor

And here in Canada, we won't see this rental service for another 2 years... oh joy.

*crossing my fingers hoping I'm wrong*

Dec 27, 07 - 02:21 am Comment from: MikeK

@Wake Up says

"Umm, DVDs aren't High Def people. The article is referring strictly to DVDs. If you want High Def you need Blu-ray for that."

------------------------

Umm, No, the article is not referring strictly to DVD's. The article clearly states that there will be an on-demand rental service from iTunes IN ADDITION TO a deal where Apple has licensed Fairplay to Fox to offer Fariplay files on physical DVD's that Fox sells ..

We all know that DVD's are not HD, but there is still a chance that the iTunes rental service will offer HD content.. Unlikely, but possible.

Dec 27, 07 - 02:36 am Comment from: Mark

I think people make too big a deal about "High Def." Just as there are hardcore audiophiles, there are hardcore "videophiles," but most people are quite happy with standard-DVD quality. For a more in-depth look at this issue, check the following Roughly Drafted article:

http://www.roughlydrafted.com/2007/12/04/why-low-def-is-the-new-hd/

Even if Apple offers "mere" DVD quality, I think that will be good enough for the vast majority of viewers.

Dec 27, 07 - 03:59 am Comment from: pete1967

This is excellent news!

Now that Apple is going to do this you can say bye bye to Blockbuster and all those bricks and mortar video rental stores.

Those stores should have seen this coming years ago and got into online movie downloads, but now its too late, if I was CEO In any of those companys I would be crying in my breakfast.

RIP bricks and mortar rental stores (2008)

Dec 27, 07 - 04:16 am Comment from: Ampar

Yes, it's good news. Pauly Shore just went shopping for a new used Sebring.

Dec 27, 07 - 05:57 am Comment from: flappo

as has been mentioned , 720p is more than good enough for hdtv

most of sony and ms's games are in 720p and they all look amazing

halo 3 is even in 640p !

tv's nowadays upscale things so well , i wouldn't worry too much aboot all this 1080 hd tvcrap

i've got an 1080p screen and it's only really useful when i plug my mac pro in , most of the time i honestly can't see any difference between 720 and 1080

Dec 27, 07 - 06:36 am Comment from: Metryq

Skip all this "HD" stuff. Jump straight to "Red" encoded material. 4K! (red.com)

Dec 27, 07 - 08:19 am Comment from: dallas

I would buy an Apple TV that day if they announced it. (Assuming they don't announce an upgrade the ?TV that day and make me wait until June.)

Dec 27, 07 - 08:34 am Comment from: Denny

Merry F--cking Christmas!

Dec 27, 07 - 08:37 am Comment from: Denny

Hey look at this stuff!

http://www.forbes.com/2007/12/26/apple-patents-iphone-tech-wire-bc_1227appatent.html?partner=yahootix

This is bigger than movie rentals!

Dec 27, 07 - 08:44 am Comment from: Nate

I think the bigger story is being missed by the title of the article and the majority of readers. Rentals is one thing, but it's something that most people have access to via their cable providers already. Not saying that the feature can't grow iTunes (especially as one person said if they offer a huge catalog of classic movies)

The big story is the fact that Fox will allow "legal" ripping of the movies which is parallel to what built the iPod and iTunes into what it is in the music industry - iTunes store was built by allowing most people to add to their ripped libraries. For most people, the FairPlay works great and I suspect copies of movies will work for an even higher percentage. How many people have 5 devices they want to store the same copy of a movie on? All the people who've been complaining about trying to get ripped movies onto their ATV, this is the beginning.

Is there really a need to follow the legacy iTunes movie resolution anymore with the widescreen iPod transformation? As far as I understand it, the original resolution was decided based on the iPod's screen res. at the time. I'm interested to see if I want to rip a movie what my choices are for resolution - do I have to follow the current iTunes resolution or does it rip natively and then scale when transferred to iPod or does the iPod scale it.

Dec 27, 07 - 09:00 am Comment from: dallas

@Nate-

To me it doesn't sound quite the same as Ripping music off a CD. It sounds to me like there will be an alternate file already encoded on the disk already with DRM included as a free upgrade. That means no, you can't pick the resolution or the file type, or the packaging. Now what that file will look like is anyones guess, but you don't get to pick it. I would expect full DVD quality. Would be disappointed with anything less and surprised at anything more.

Dec 27, 07 - 09:51 am Comment from: dd

My wife and I rent stuff on occasion. $2.99 for 7-30 days is much better than the $2-$4 Blockbuster charges for 2 days.
I'll use this.

Dec 27, 07 - 09:55 am Comment from: en

"...except that shithole known as Vivendi Universal."

Hey, be nice! grin I use my pc at work to watch Hulu and get free movies. A bunch of my favorites are there.

Now, would I ever, ever, ever buy from them?

Are you out of your ever loving mind??? Of course not. But hey, free is free and work makes me use a pc so, the two are a match. grin

en

Dec 27, 07 - 10:25 am Comment from: Arnold Ziffel

Rupert "the Snake" Murdock's News Corp is a slimy piece of filth. Even though I like Apple and own stock, I wish they didn't have to deal with this Schweinhund.

Dec 27, 07 - 11:56 am Comment from: Touch

On the HD issue, I think everyone is missing something. There are a lot of iphones and itouches out there now and a lot of people with time to kill in airports, hotels, coffee shops and even at home. If you can rent a movie from you iphone/itouch over itunes in any place with WiFi, an unreachable market for Netflix or Blockbuster opens up.

In fact, it is a whole new market, considering that a lot of people will be using these devices when watching a movie alone. Why download HiDef video y LowDef will do? Instant watching too. No time to wait for the movie to download anymore.

Some may think that watching movies is something that we would like to do with family or friends, but think... Do we listen to music in groups over stereo systems a lot lately?

I think the way we watch movies in the future is about to change and Apple will lead the way. Again.

Dec 27, 07 - 12:08 pm Comment from: MikeK

@Touch

I don't think there are very many people out there who'd be willing to wait for a movie to download to their iPhone or Touch while in an airport or coffee shop.. Even with wi-fi, you're talking a minimum of three hours to download.

For this reason alone, I think the movie rentals will be limitied to a Mac, PC or Apple TV. Of course you could sync it to a portable device, but not download directly to it.

Dec 27, 07 - 12:25 pm Comment from: Ampar

"Apple inks online film-rental deal . . ."

Shouldn't that be "Apple binaries online film-rental deal . . ."?
It's time to let go of our analog ways.

Dec 27, 07 - 12:28 pm Comment from: Ampar

"I don't think there are very many people out there who'd be willing to wait for a movie to download to their iPhone or Touch while in an airport or coffee shop . . ."


True, but if I had a long wait somewhere, I'd rent and download a 22 minute TV show (one episode without commercials).

Dec 27, 07 - 01:48 pm Comment from: Touch

@MikeK

If you can watch youtube instantly without interruptions with wifi, why not a movie? The trick is you do not need HiDef. The right format and resolution will do it. For iphone or touch watching it is simultaneous if you have the right sized file and good enough bandwith.

Agree there are not many places with enough bandwith yet, but a few is good enough. More will come every day.

Dec 27, 07 - 03:47 pm Comment from: MikeK

@Touch,

"If you can watch youtube instantly without interruptions with wifi, why not a movie?"

------------------------------

Because most YouTube videos are about five minutes long and pre-buffer for about a minute, while most movies are about two hours long. Big difference.

There is absolutely ZERO chance that Apple is going to rely on un-interrupted internet streaming service via wi-fi on portable devices with it's new movie rental business.

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