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May 1, 2008, 12:54 pm

Apple’s new Hollywood deal: Death of the DVD?

The news that Time Warner CEO Jeff Bewkes let slip in a conference call on Wednesday — that from now on Warner Bros. movies would come out as video on demand the same day as the DVD — turns out to be bigger than he let on.

Apple on Thursday announced that not only would Warner Bros. titles be available for purchase on the iTunes store the same day and date as DVD release, but so too would movies from 20th Century Fox, Walt Disney Studios (DIS), Paramount Pictures (VIA), Universal Studios Home Entertainment, Sony Pictures Entertainment (SNE), Lionsgate, Image Entertainment and First Look Studios. (press release)

Even before the full extent of the deal was revealed, analysts were talking about the consequences for the DVD business. “Time Warner To Help Kill Off DVD Rentals” was the headline of Michael Learmonth’s piece in Silicon Alley Insider Thursday morning.

What does all this mean? It means Time Warner is finally ready to start weaning itself from DVD sales, which have been Hollywood’s biggest revenue source for years.

It also means that if Blockbuster — or Netflix, for that matter — doesn’t figure out electronic delivery, it is toast. And it means that Sony and Toshiba just incinerated a pile of money in a useless DVD format war. (link)

What convinced the Hollywood studios to cut this deal with Apple’s (AAPL) Steve Jobs? According to Time Warner’s (TWX) Bewkes, the company had been experimenting with “day and date” video on demand (VOD) release for several months and found that DVD rentals only fell by 3 to 5 percent and sales of DVDs actually increased. Since VOD is so much cheaper than printing and distributing discs, it looked like a no-brainer.

“Taking a customer and moving that person over from rental-physical over moving them to VOD day-and-date is like a 60 to 70 percent margin instead of a 20 to 30,” Mr. Bewkes said, according to the New York Times. “So it’s about a three-to-one trade.” (link)

Among the titles immediately available for download on iTunes: “Juno,” “Cloverfield,” “I Am Legend,” “There Will Be Blood,” “American Gangster,” “The Diving Bell and the Butterfly,” “Alvin and the Chipmunks” and “Walk Hard: The Dewey Cox Story.”

From the numbers given in this article, clearly VOD is overpriced…

Posted By Nunya : May 8, 2008 2:35 pm

Some of us live in rural areas and use satellite internet. Pretty good but not fast enough for streaming video so, for now, those of us in rural areas will continue buying DVDs.

Posted By Rick Moschilli, Kempner, TX : May 6, 2008 7:27 am

m in los angeles,

Are you sure that retailers are using “online” POS systems? These would not possibly be VPN’d to a server and give internet access as an additional feature would they? Or have an onsite server in the store (servers for such simple tasks are cheap these days…and most already are pipelined into some form of server system with their previous POS machines [AS400 servers are common]).

Having *MY* personal storage on some anonymous web server through a typical internet connection is much different from me OWNING a server with a VPN connection (VPNs come at higher cost mind you!) that I use for remote storage. It isn’t just a question of actual real security but a question of perception & acceptance as well.

By the way - if you start streaming a movie (say 1 minute to buffer and you have a good solid 6Mbit/s download speed), how do you guarantee a QOS that keeps 30 other people in the neighborhood from downloading at the same time? You might end up with a movie pausing half-way in the middle of a download to “buffer” more data…if my kids want to watch a movie (which I get from an online storage source) and I am trying to simultaneously move some large files around…well I see problems with this until bandwidth increases.

Posted By Patrick, Bellevue, WA : May 5, 2008 4:04 pm

There was some confusion for the price of entry into Apple’s service.

1. You do not need a Mac. iTunes is a free software that runs on Windows or Mac OS. To watch your movie download on a computer you don’t have to buy any new hardware or software.

2. To watch iTunes movies on your TV you can use Apple TV, but you can also use most iPods with a TV cable. Apple TV is $230 (not $300 as someone suggested). The smallest iPod nano plus video cable is $200.

Posted By Tom Ross, Berlin, Germany : May 5, 2008 10:28 am

James in San Francicso was right on this point: “If the movie studios / distributors have a better profit margin with VOD.. that is the way that the industry will move.”
There’s a great deal of truth in that. Hollywood doesn’t care what we want or how we want it - they will give us what THEY want to give us in the manner that makes them the most money. There’s plenty of evidence of this: the HD format “wars”, lawsuits against their customers, the DMCA… If bandwidth starts costing or being limited, and we have movie studios that own cable companies (Time Warner?), won’t they make even more money on VOD from the bandwidth usage?

They are not interested in what we, their customers, want. They’ll give us what THEY want and we’ll like it, by golly. All arguments about what has the best picture or sound quality are immaterial against profit margin.

Posted By Ken, Austin, TX : May 2, 2008 4:19 pm

Storage is all going to the web as well.
Its about broadband speed and bandwith… we are way behind the rest of the world.
It doesnt make sense today…. but the implication of Warner Bros ceo capitulating, to digital distribution will shortly be seen as revolutionary.
WB owns the patent on dvds and receives residuals for every dvd sold,do you think they would take this step lightly?

Search online web storage.

In the retail business an unstoppable trend is online base Point of sales systems. You would think that having all the issues with that,security,unreliable storage etc. would be prohibitive,but no with web based backups every several minutes,huge advances in server technology. Its cheaper than owning your own systems.

You’re going to need a storage unit for all those lps,cassettes, cds, dvds and bluray discs.

Once the speeds(new spectrums) are up to snuff hard drrives will probably be a thing of the past as well. Why use them if you can get easy access to your content online.

Heres a link to the issue about video quality.

http://bits.blogs.nytimes.com/2008/04/30/blu-ray-the-future-has-been-delayed/

Posted By m los angeles : May 2, 2008 1:34 pm

Someday, this may come to pass, but high capacity storage will always play a niche role. 1) Collectors of films want reliable backups; sticking your only copy on an enormous hard drive does not make sense unless you are also backing that hard drive up to a second enormous hard drive. This doesn’t make sense yet. Heck, if I buy a full album of music (versus a single track of two), buying a CD is often cheaper, higher quality, and gives you an instant backup…even if you mostly listen to ripped mp3s of that CD. For HD content, given the enormous sizes involved, the case is much more dramatic. 2) If you have kids, renting the same movie repeatedly is moronic. Parents buy DVDs because kids love to see their favorite films again and again…DVD and Blu-ray make far more sense for this than a download at present. 3) Portability: Unless you enjoy the hours long process of resizing content for different portable media like iPod, iPhone or PSP, the beauty of DVDs (and eventually Blu-ray) is cheap players you can bring in your car or anywhere…same disc at home or on the road…no computer knowledge or DRM hassles. This is another huge parent friendly feature, and remember, many parents aren’t spending hours recompressing, resizing content just so that Junior can keep quiet for that long vacation trip. Only geeks are doing this…and some of us are actually putting the new files BACK on DVD because they are so cheap and handy…

Frankly, it took quite a long time for the broadband infrastructure to become sufficient for music distribution and that was a piece of cake compared to what is needed for HD video. In the developed world, we are very far from that as our existing infrastructure is the enemy of progress.

And for those who deny it, there really is a HUGE difference between compressed audio and compressed video. These prophets of technology don’t get it: there isn’t a simple formula you can use and bring to new situations which will always work. Different media may require different solutions—at least until the technology catches up. And believe me, other than the occasional convenience of a VOD or a “HD” (highly compressed 720p at best) download, the arrival of large 1080p flat panels is not only going to make DVDs relevant again — upconversion looks better than downloads in many cases — but has made Blu-ray the medium of choice for serious movie watchers and collectors. Large 1080p sets show the deficiencies of lower quality content far more readily than a much cheaper portable digital player can show the limitations of mp3s. Humans are primarily visual creatures; a huge portion of our brains is devoted solely to visual processing. Because of this, the challenge of downloadable video to replace physical media is much greater, but we aren’t prepared technologically to bridge that gap yet.

Let’s talk again in 5 years…by then, maybe FiOS will be available to me (I hate cable monopolies!!!!… Heck, these monopolies ALONE should be enough to inject some critical doubt into the ‘death of the DVD’ claims…!)

Posted By Jon the Heretic, Stamford, CT : May 2, 2008 10:21 am

The author is just no not have any idea what he is talking abut. He just do not understand that human eye is much more sensitive device than human ear. And also all that electronic music junk which found its way as mp3 do not loss almost anything because of mp3 compression. At the same time with classic music there is big difference especially for people with good ear. But for pictures almost everybody can distinguish good quality picture from bad and the difference especially on high quality HDTV is very big. I would say there is nothing right now which even remotely comparable in quality with Blue Ray movie when it is specifically made for Blue Ray and not some generic HDTV format. (Some studios use to have the same HDTV master movie released in both HDDVD and Blue Ray)

Posted By Paul, Sunrise, Florida : May 2, 2008 2:11 am

VOD will not kill DVD anymore than TV killed the film industry or VCRs killed movie theaters.

They will complement one another. I thought this column was meant to inject a bit of skepticism into Jobs’ reality distortion field???

Posted By Michael Fallai, Phoenix AZ : May 2, 2008 12:09 am

Doesn’t matter if it’s same day.
If it’s ipod quality, its not even compariable to DVD…when run on my 55inch hd tv, it’s going to look like crab. If it’s regular dvd quality, think 4G or 8G file is going to take me hours to download.
Don’t want download time more than me watching the movie.Even when using cable…plus comcast is putting limit on download….double suck.
if it’s HD quality…it will be days to download one movie…
forget it.
it’s not like applie don’t have movie on itune..just that no one want to buy it.

Posted By andy,tx : May 1, 2008 11:48 pm

There is no comparison to the conveniesnce of pushing a button and getting a movie. There will still be DVDs but most people prefer convenience over quality (isnt the proof already there with mp3s). Especially when the quality difference is only possible to discern on a 60″. Apples HD content may not be as good as Blu but probably for the masses its good enough and will probably improve with time.

Posted By Kyle Tampa, FL : May 1, 2008 9:31 pm

The cross pollenization of computer and TV is near. When the pipeline to you home becomes large enough and cheap enough to pipe HD (Fios) to your TV this will be the death of DVDs. Sure, Apple Tv is a hobby for Jobs, Sure Blue Ray when it comes to storage. We all thought Betavision was going to be great too. Direct delivery of what you as a consumer want to watch in this youTube driven world is the way to go. It’s all about the delivery system..

Posted By Michael, Huntington BEach, CA : May 1, 2008 8:42 pm

ITunes can be downloaded to Apple TV, which is HD compatible, so are any Media Center and Vista PCs.

Posted By Mike, Portland, OR : May 1, 2008 8:37 pm

What I think is missing in this discussion is the economics… If the movie studios / distributors have a better profit margin with VOD.. that is the way that the industry will move. And if Apple is at the forfront of this movement.. which they certainly are.. Then holders of AAPL will certainly be the beneficiaries of the industry change.

Posted By james, San Francicso, ca : May 1, 2008 7:10 pm

It seems like a nice idea until you hit the bandwidth cap on your downloads and have to wait until next month to get your movie!!

Posted By Nate, LA, CA : May 1, 2008 7:04 pm

more nonsense from from itards. I Just bought my 60″ 1080p from sony and my nice blue ray hddvd combo unit along with my nice surround sound system. So why would I download regular dvd movies from apple or wait forever and a year to download a 10gig Blue Ray file. With Netflix for $20 a month I can rent 4 movies at time close to 20 movies a month all Blue ray quality.

Posted By macdisser,bronx,new york : May 1, 2008 7:04 pm

Yeah, I didn’t buy a nice HDTV to watch compressed video on my iPod. I want HD video. If they can deliver that electronically, then maybe DVD is dead. Until then though, give me my Blu-Ray.

Posted By Brian, Colorado Springs, CO : May 1, 2008 5:57 pm

While some people will enjoy this technology, I doubt this will be the end of the DVD as many have already said. For the person who said that DVD is going to go the way of the CD, last time I went to Best Buy, I saw more than one rack of CDs, and music is easy to get off the internet. Some musicians prefer to release their music on CDs and I am sure some people will prefer to release their movies on DVD. It’s going to be a long while before DVDs start to decline

Posted By Brent, Milwaukee, WI : May 1, 2008 5:57 pm

One thing I think people are overlooking is hardware costs. Not everyone is willing to spend $300 or so to get AppleTV, or even more to get an iMac or other Apple product to watch this content. And given the economic state of the country, I think buying additional hardware will fall more into the “luxury” category than “necessity.” Many will be UNABLE, not just unwilling, to buy the additional hardware required to use this. That may be hard for the six-figure-plus earning nerds with an affinity for the latest toys to believe, but I assure you that you are in the minority!

The other thing to guard against is hidden costs. Anyone remember DivX? Not the codec, the Disney/Circuit City DRM’s DVD format that required you to pay for each time you watched a DVD you bought (albeit the discs were cheaper than non-DivX DVDs at the time). If your kid wants to watch “Cars” every day, you better make sure that every viewing doesn’t cost you something!

Posted By Ken, Austin, TX : May 1, 2008 5:50 pm

Where the heck do I get a 1 TB drive for $109?

(”Steve Job’s”? Egads.)

Posted By 1tbdriveseeker, Cupertino, CA : May 1, 2008 5:50 pm

The time it takes to sit down on the couch and start watching hd content with full surround sound is less than a min…

as far as quality..

http://bits.blogs.nytimes.com/2008/04/24/blu-ray-do-consumers-care/?hp

as for storage…
http://www.pcworld.com/article/id,125729-page,1/article.html

why do I want dusty never watched dvds around.
I can even keep a copy of Shrek or whatever for my
grandkids,without taking up space,

welcome to the future.

Bluray dyscs will be pennies on the dollar on ebay in a couple of years,a great way to increase the library I stream freely through Itunes to my Apple Tv connected plasma screen.
kind regards.

Posted By michael,Los Angeles,Ca : May 1, 2008 5:45 pm

Who in their right mind is going to download a compressed junk-quality movie for hours on end when you can rent a high definition one for 5 bucks?

When downloading high definition movies becomes common place - we have moved on to “Alien 1″ version of the Internet. No matter personal T1, T2, T3 feeds… Even regular DVDs are far from dead.

Ok, I’m sure there is one or to Apple nerds that will impresse other Apple nerds, by TRYING to watch Cloverfield on an iPod… *sigh*

This is non-news - and a storm in a shot glass.

Yes, in a galaxy far, far away they might have the bandwidth to make this nonsense a threat to DVDs. Right now - it’s just silly.

Posted By Tapani, Montreal, Quebec : May 1, 2008 5:41 pm

Patrick,
I understand evryones connections with having that copy in your hands,I happen to frequent amoeba records.
But that is a seperate issue from the direction of content delivery.
One click, Im watching the content(on my Apple TV) within a min(usually 30 secs) over a 6 mb connection.
The hardware accomplishes this. I would love to have you over to my home to show you. It just works!. Like I said in an earlier post.
The Apple TV is so far ahead of the service from Netflix “watch it now” it’s really a joke.

About quality here is al ink from the Ny times today.I don’t buy into the mass marketing hype about bluray.

Everyone is right. all the content isnt there yet…thats my point Jeff Bewkes just set the ball rolling. Lets have this conversation the day after the digital content act happens next year!

The blu ray disc you buy has anti piracy encoding as well.
Not to mention the third party apps to remove drm. Which I dont use because I believe in paying for all my content.
What is everyone afraid of,a bigger box to store your vinyl,cds,8 tracks etc.
That box just happens to look like this in the future,
no more dusty never watched dvds etc. I can even keep around a copy of Shrek for my grand kids(stored digitally) without having to take up space.

http://www.pcworld.com/article/id,125729-page,1/article.html

http://bits.blogs.nytimes.com/2008/04/30/blu-ray-the-future-has-been-delayed/
The future is upon us.
kind regards.

Posted By Michael,Los Angeles,Ca : May 1, 2008 5:34 pm

Sorry, but I’m not going to wait four days for a high-definition movie to download, and have my internet connection crash half-way through. Nor am I about to watch a compressed film which, on my 57 inch Sony, will likely show pixels the size of my fist.

And, as others have pointed out, what do you do when your hard drive dies? And where will I even get a hard drive large enough to store several hundred movies in high-definition? Where is the infrastructure to send all these enormous files over the internet?

The technology just isn’t up to snuff yet, and when it is I want to be able to find a competing company rather than let Apple get richer with obscene profit levels. A 60-to-70 per cent profit margin? How greedy can one get?

Posted By colony14 author, Peruibe, Brasil : May 1, 2008 5:17 pm

There’s more than 1 way to skin a cat. Saying that having VOD available will kill DVD is insane. Yes, it will reduce DVD sales. In the same way that cell phone have hurt traditional phone companies, and iTunes has hurt CD sales.

But in no way is the telephone or CD dead. They’re not even crippled. They just aren’t as dominant as they once were.

I, personally, don’t want all of my entertainment to be streamed. As it is, if I lose my Cox service, I lose my phone, internet, and TV. I’d hate to lose my ability to match movies as well.

Also, what is the service like? Do I pay $1.99 to rent a movie? If so, no thanks; right now I’m cycling through 20+ DVDs a month with my 3-disk Netflix plan. While I can also stream 30 hours a month through Netflix’s on-demand service for free.

If iTunes uses an unlimited download subscription, I might give in. But they haven’t done it with music yet, so why would they with movies?

Posted By Jim, Omaha NE : May 1, 2008 5:17 pm

Yeah….I dont see an end to DVD’s Anytime in the near future. There are millions of people who take pride in their Library of Films.

Posted By Mark J Kansas City, Mo : May 1, 2008 5:12 pm

Blue ray will take over. I want the 1080p quality, not the degraded version. Discs promise quality, Streaming video comes compressed. Sure, its a nifty new toy to play w/. Besides, ripp’n movies is too easy.

Posted By johan, philly : May 1, 2008 5:03 pm

The fact the author states that “. . . it means that Sony and Toshiba just incinerated a pile of money in a useless DVD format war” reveals the author’s lack of a comprehensive knowledge on this subject. These two companies weren’t involved in a DVD format war but a High Definition disc format war–which is a significant difference and a reason why we aren’t at the point where downloadable content isn’t for everyone just yet.

Here are the reasons why Netflix and Blockbuster don’t have to worry–yet.

1. Many people are buying nice new HDTV’s. If you have one of these sets you want to view HD content. Most download services dont provide HD movies yet.

2. Those services that do provide downloadable HD content take forever to transfer a huge file.

3. It’s still not terribly easy to get content from a website onto your television so most are stuck with cheesy laptop screens to view it. Many sites/services only let you watch the shows on the website.

4. Perhaps the most important reason of all is that premium content online costs much more per movie than a netflix or blockbuster membership. Why spend $3.99 or more renting a movie when you can have 16 or more for $16.99 a month from netflix?

5. Apple TV is a joke. Even Steve Jobs has said it has not been successful and calls it “a hobby”

6. Some movies I like to “own”. I’m far more comfortable with a physical Blu-ray disc than a file which has all kinds of restrictions on it.

ex ped: You are confusing the author of this post with the author of that quote.

Posted By Anonymous : May 1, 2008 4:32 pm

VOD is good for you to test whether you like the movie and if you do you can buy a DVD of it period. Why all the hate?

Posted By AdamC, Miami, Florida : May 1, 2008 4:29 pm

DVD’s aren’t going anywhere…. Anyone who downloads movies, by what ever method, knows that it takes some time to do it. I have never seen a movie on my pc download quicker than about 45 min, and my system could put the lights out in a large city, so for the speed to be increased it would take a lot more work. Also, how do you get the movie to your tv? adapter? Burn it on a “disc”? by the way using nero software still takes at least 30 min. So in that hour and a half I have driven to Wally world, bought 3 movies, popped pop corn and am sitting on my couch pressing play. Nice try but some of us want it when we want it….Not an hour later

Posted By Rusty DFW : May 1, 2008 4:25 pm

Hey, day of release videos over the Internet? How cool is … oh, no. I’ve lost my cable connection again. (Sigh) And I’m paying how much more for high-speed connection? And now I can’t d/l the video I just purchased!

Posted By PAB; L.A., CA : May 1, 2008 3:59 pm

I can see how someone would buy a relatively small file (MP3) and ignore the loss in quality since it will typically be played on a portable device in less than ideal environments (gym, bus, next to a busy street) with sub-par equipment (you don’t see too many people at the gym with $500 high fidelity Noise reduction headsets right? they use the little white $15 earpieces).

On the other hand, when I watch a movie I do so in a somewhat controlled environment (less noise, I can shut the curtains to simulate the dark theater environment). I am not walking around or trying to keep entertained while running for a half hour…I am relaxing on my couch enjoying some snacks and viewing everything on a decent size high def TV. I don’t want to see “artifacts” for a lossy compression, lose my surround sound, watch movies on a computer monitor or play around with 100 feet of monitor cable. 4.7GB dvd download? Hmmm…if I have 4Mb/s download speed it would take a good 140 minutes to download that file (and if everyone in the neighborhood also has high speed internet through cable and we are all downloading movies at relatively the same time: when we get off from work or on a weekend evening, I could see the download throughput for the each person dropping since they plan for X amount of average use statistically and not for everyone in the neighborhood utilizing max download speed constantly for a couple of hours…

Nah, I don’t see DVDs going away anytime soon.

Posted By Patrick, Bellevue, WA : May 1, 2008 3:48 pm

Agree with Michael from LA — I buy a movie on my iTunes with one click. With a click or two more, I have it synched and available on my iMac, my wife’s MacBook, our iPhone (if we choose to), my iPod and all my tv’s (by way of wifi AppleTV) at the same time. It’s brilliant.

“think Apple will let you burn a copy of the movie you just bought?”

Why the h@ll would I want to burn it onto a disc? There’s nowhere I can’t play it.

Posted By jswede, Chicago : May 1, 2008 3:46 pm

Thomas,
Next time your’e in a plane ,notice that people with the “tiny” screens attract a lot of attention…it’s not about wanting to watch on a tiny screen . Its about being able to. I have a 60″ plasma at home. But when i’m streaming content to my iphone in Vietnam,Or Denmark or London via a high speed wifi connection its all good.
I havent seen a blackberry user in the wild watching a movie on that device.(full disclosure,I own Rimm as well, at least for the short term!)
All I’m saying is it is a technological revolution taking place. Itunes sold more content than walmart to become the worlds largest content provider.In 5 years!
Guess it doesnt take too long to change platforms.
Bluray is dead before it get out of the door.
They will great to buy on ebay for pennies on the dollar and then load into itunes r what ever digital service you will use.

Posted By michael,Los Angeles,Ca : May 1, 2008 3:45 pm

I have thought about this and I hope that it will not kill DVDs. The reason I say this is the ISPs are toying with the idea of charging by the gigabyte instead of a flat service fee. I shudder to think what it will cost to download several movies in a single month. Cable companies like COMCAST have admitted that they throttle back the data on what they call “high capacity” users. Verizon DSL may be doing the same as well. On top of that, they actual speed that a file downloads is so inconsistent that I can’t imagine downloading movies. I have Verizon Fios (fiber optic service) with 1.5 MB/s download service. I have never achieved that rate. As an example, I tried to download a free game for my Mac two nights ago. It was a large file, 504 Mbytes. The best I could get using an optimized Firefox browser was 38 Kb/s. And remember, I said the best I could get was 38Kb/s, not a sustained rate mind you. I just gave up. I went to the same site last night and was able to achieve between 933 Kb to 1.1 Mb/s sec. A big difference obviously. But can you imagine trying to down load two or three high definition movies? I don’t think I want to try, especially if I have to prepay for the movie and fail to complete the transfer.

Posted By Mike, Rowlett, TX : May 1, 2008 3:31 pm

I use these things every day. Here is the quick review:

1. No “extras” on VOD. So, if you’re a cinema buff who likes trailers, interviews, deleted scenes … SOL on VOD.

2. SD VOD on AppleTV looks like pixelvision compared to upscaled DVD in 16:9. Better Netflix than SD content on an HDTV.

3. AppleTV HD VOD looks amazing, YOU RENT FROM COUCH, TAKES LESS THEN ONE MINUTE TO BE READY!!! THE FUTURE!!!

4. AppleTV needs larger buy-to-own movie library AND IT NEEDS EXTRAS!!!

5. For movie buffs who want to OWN movies: go DVD/Blu-Ray.

6. For disposable content (rentals) go with AppleTV but only the HD content. Fast, easy, sounds and looks fantastic on an HDTV - better than HD cable, I think.

Until Blue Underground or Media Blasters release their libraries on AppleTV, I’m sticking with DVDs. But new releases for rental? I strongly urge people to buy into AppleTV and it’s fast WiFi HD rental system. It really is cool for an HDTV home-theatre and surround stereo system.

Posted By Chris, Brooklyn, NY : May 1, 2008 3:30 pm

the resolution of HD content (from apple tv) is better than dvd less than true1080.
With that said,I challenge you to download a movie in regular quality,burn it to a dvd and see if you can tell the difference. Im a technofile and it is imperceptible.
After my experience with Apple tv, not to mention streaming content to my iphone via reomtebuddy (I admit i’m an apple fanboy and shareholde.r)
The reality of a comprehensive world wide broadband network(sooner rather than later)will make dvd sales tenuous at best.
We are so behind the curve in broadband,wait until fiber optic networks are a reality here. Verizons fios,TWC is rolling fiber this year, comcast is investing $19 billion in infrastructure. The rest of the western world is at twice to three times the speed,and yet Apple TV does a great job over a typical american connection.
Its coming…if you cant beat join em.
Its not cost effective to make a dvd(Warner Bros,holds the patent for every dvd sold,i’m not sure if they still receive residuals,but obviously this is an incredible seed change for future revenue streams).Coming from Bewkes
ceo of the largest media company in the world i’d say this is revolutionary news.
Sorry for being long winded!

Posted By michael,Los Angeles,Ca : May 1, 2008 3:17 pm

If you buy or rent a high-def DVD you’ll have 20GB of high-def content in your hands. If you download it, you’ll end up with something highly compressed (else the download will take 5 hours even on FIOS). Apple marketing will tell you their compression is magic and it will look as good as a real hi-def DVD, and many people will believe them.

Posted By John, Azusa, CA : May 1, 2008 2:57 pm

1. Some people still want vinyl
2. Some people say CD`s only
3. Some people say DVD`s or BluRay
4. All this technologies has taken many years to catch on, and they will use many years to die, BUT
When the industry can make 3 times as much on downloads compared to discs, they will make it very attractive going forward. It might take some years but downloads are going to win for cost, comfort, environmental and a bunch of other reasons.

Posted By Jeff, San Franscisco, CA : May 1, 2008 2:42 pm

Has anyone compared the quality of a Blue-Ray HD video with a compressed cable version of the same movie?

Posted By Jim, Mounds View, MN : May 1, 2008 2:35 pm

Bye bye physical media like DVDs - people want movies that are inexpensive and on-demand. If you are in the mood for a movie, wouldn’t your rather press a few buttons than leave the house or wait for a netflix mailing? All at about the same price or cheaper? Seems like a no-brainer to me. Watching on my HDTV is more pleasurable than going to the cineplex, I might add. That’s why I just got an Apple TV.

People who don’t think DVDs are toast (just like CDs have given way to mp3) have their heads in the sand.

Posted By Jay, Washington, DC : May 1, 2008 2:29 pm

Lemmings jumping off a cliff that’s what we are. Wait for all the facts. How soon you forget about the iPhone everyone runs out and buys one only to find out that you have to send it back for a new battery. Thats what I call marketing. The same thing here it’s all smoke and mirrors and you think Apple will let you burn a copy of the movie you just bought? I have some swamp land for sale anybody interested?

Posted By Larry Bozek Chicago, Illinois : May 1, 2008 2:19 pm

Ah, the old ‘death of’ tagline.

Yeah, if the majority of people were actually willing to download movies to watch them… thats gotta be about the same segment that wants to watch films on their tiny phone screens too.

I’d not toss the hard media just yet. There are plenty of us who want to watch a film ‘now’ with very high reliability that I can watch it all the way through without fear of a software crash or network hangup. Streaming films to my couch… not anytime soon.

Certainly never if the files are packed with DRM crud that will limit me to using an Apple viewer, or control on which devices I can view the film, etc. No I like the plain old DVD from the store. I can make a copy, watch the copy anytime I want, anywhere, and when that copy gets scuffed up, pull the original and make an new copy. Heck, I can even dump the original to my local file server to stream throughout my house.

Posted By Thomas, Seattle, Washington : May 1, 2008 2:14 pm

More reason’s to hate Apple. Although I do like the Mac OS; I really hate the way they are trying to force customers over to their way of doing things.

I doubt the DVD will end because of this. Sony will be pushing the BluRay, along with other hardware companies as they will no doubt want to fight it.

Seems that this is an attempt to break the back of the OnDemand services that cable is pushing.

I use Netflix. I like the ability to get the movies about whenever I like to get them for a very reasonable price. I don’t want to be using my computer time to download a movie or have to buy some new downloader/player just because Apple is offering this new thing. I don’t want to buy it, just rent it a watch it.

Doesn’t everyone remember when iTunes launched huge and everyone thought that the CD would already be gone? Funny, you can still find CDs all over.

This is great for some, but not great for all. The DVD will last for a while longer.

Posted By LocNar, Miami, Florida : May 1, 2008 2:14 pm

But the quality of DVD is way better than a downloaded version. Besides…hard drives crash all the time.

It’s the media that says downloads will replace DVD. Not the consumer.

Posted By Tony, Sacramento, CA : May 1, 2008 2:07 pm

you can rent or buy via itunes…Apple tv is direcetly connected via streaming or downloaded to the Apple tv unit(your choice) to itunes. So if you purchase a movie,as I did for I am legend. It is my movie to burn onto dvd.
When you experience apple tv you will KNOW ist is a game changher. Apples trojan horse. Look at the gain in itunes content delivery yoy and extrapolate out say three years and you’ll see it is a huge profit center.
Since the Apple tv take two update came out my netflix rentals went from 10 per month to 3. Netflix better buy tivo!Or some hardware manufacture…HD content being downloaded-and being watched in less than 1 min is a no brainer.

Posted By Michael,Los Angeles,Ca : May 1, 2008 2:05 pm

i don’t LIKE watching movies on my PC and I don’t want to buy an AppleTV. So…I’m still going to be in the DVD market. I can’t see the DVD market drying up anytime soon. The rumors of its death should be taken with a grain of salt.

Posted By Frodo, Chicago IL : May 1, 2008 2:02 pm

What a sensational title “Death of the dvd”. Columnists seem to love to predict the end of things as we know them as soon as some new technology is unveiled. The internet was supposed to mark the death of retail as we know it. Home video in the form of VCRs and now dvds would mark the end of people going to the movie theatre. Microwaves were supposed to replace the conventional oven. The list goes on and on. This online delivery of VOD may one day change the way we view movies (and ultimately mark the end of dvd), but until it’s possible for people (not yuppies with iPhones) to download an entire movie onto a portable device (in less than the time it would take to drive to blockbuster)and take that device from their computer and play the movie anywhere they like (in their faimly room, in their car for the kids, on the plane, etc.) mom and pop in the heartland aren’t giving up their dvd player.

Posted By Dave, Phily PA : May 1, 2008 1:58 pm

“And it means that Sony and Toshiba just incinerated a pile of money in a useless DVD format war.”

Not unless everyone in the US has access to FIOS. I do not want to have to stream my HD movies, nor do I want to return them. I would rather pay the extra money and “own” my media.

And unless Apple gets a plan similar to Netflix, I won’t use their service.

Posted By Carlo, Concord, CA : May 1, 2008 1:54 pm

I’m not too convinced that Video On Demand is the future of releasing movies, however it may be the future of renting them. I’ve never actually rented an online movie, but I imagine that the quality isn’t 1080p like you can expect from Blu-Ray. So providing movie rentals might actually encourage people to buy discs since they’d be able to enjoy the movie in a higher-quality format. Plus get all of the extra features. Not to mention they wouldn’t have to use of hard disk space on their computer, which may be cheap but if you’ve got a DVD library like I do your hard drive would still fill up quickly.

I think too often people and the industry believe that what works for music will work for film. The way people enjoy these media is completely different. People don’t mind owning a music file, but I think they’ll have issues with owning a movie file. In contrast, nobody wants to rent music online, but renting movies is more convenient for many people.

Posted By Tony - Dover, NH : May 1, 2008 1:51 pm

“Having an electronic copy of a movie on my Mac or Apple TV is NOT the same thing as owning the physical DVD-in a case-with Art Work and the ability of it to survive a total hard drive failure”

That is what most people used to say about Vinil LP’s then CD’s now it’s the movie business turn to get revamped.
I can hardly imagine this is not the future of movie distribution
worrying about loosing data is nonsense , just like with music purchased on itunes I am sure you can back up all your video files

Posted By l : May 1, 2008 1:49 pm

Maybe they figured that their content is hemorrhaging out the netflix and blockbuster doors. Rip, rip, rip and play forever. A one TB disk costing $109.00 can hold 500 made for digital TVs rips. Some people have many, many of these set free from the source recordings. They better find a cheap like itunes model.

Posted By Charlie Destin FL : May 1, 2008 1:44 pm

DVDs are about to go the way of the CD, Laser-Disc, Tape, 45s, 8-Tracks…

Man Steve Job’s is a visionary, he’s been pushing this the past couple of years. Thank God I’m loaded with Apple stock!

Posted By Anonymous, San Jose, CA : May 1, 2008 1:42 pm

Sony and Toshiba just spent a ridiculous amount of money in a DVD war so they could put 40 GB HD movies onto a disk that will look fantastic on someone’s 1080p television. I don’t know if Apple is offering these 40 GB downloads but until America’s high speed internet infrastructure gets 1000 times better, I can run back and forth between home and Blockbuster and watch about 10 HD movies in the time it will take to download 1.

Posted By Daniel, Dallas : May 1, 2008 1:40 pm

This is silly “the death of the DVD” give me a break. People are always going to want to have a hard back up, yes there will be many people who will switch over. But to say its the death of DVD or Blu-Ray. I will be worried when the average internet speed is able to download a 10gig file in an hour which is about the size of a HD movie in best quality.

Posted By David, Chicago, IL : May 1, 2008 1:34 pm

This won’t do any harm to the DVD purchase market, it WILL effect the rental and VOD market.

The studios realized long ago that people consume movies in many way for many different reasons.

There are many movies that people will rent, but prefer not to spend the extra bread to own. On the other hand, when they really like a film, the notion of owning is appealing. As are all the special features and “extras” that they get on the DVD release.

Watch out Blockbuster and Netflix, however. This is a direct shot across the bow. Why do you think BB is looking everywhere (circuit city, now bigger presence in games, etc, etc) for a different model.

The biggest threat is to Netflix. They are a pure rental play and their model will not compete well against Apple’s model. They did well against Blockbuster’s relatively unsophisticated internet push and their brick and mortar model, but Apple is going to eat Netflix’s lunch.

Posted By David, New York City : May 1, 2008 1:31 pm

I think Apple and Time Warner will have a digital receipt of your purchase on file… So if your apple tv broke… then you just get a new one and re-download for free the movies you purchased before…

Kinda the same as if you broke your DVD player… you can’t play your DVDs without the player. Think of digital media the same.. you own it forever.. it just might have to be re-downloaded sometimes.

Anyone with Apple TV test this theory?

thx,
Ryan

******
So I am left with only a digital file for a movie?

What happens is the case of a hard drive crash? What happens when my kids want to view a movie on the car’s portable DVD player? Can I burn these downloaded movies to disk?

I’d rather that the DVD I bought gave me the option to also download it as well.

Posted By Los Angeles, CA : May 1, 2008 1:29 pm

I think this article is overstating its relevance to today’s market. There are still many people, especially people who aren’t technically inclined, who will continue to rent DVD’s or who don’t have their computers hooked up to their tvs or who don’t watch movies via computer. This is going to reach the population that is tech savvy and most likely younger, but it won’t totally affect everyone. It’s essentially like Cable’s On Demand/Pay-per-view option, which obviously hasn’t killed DVD sales yet either. Until society makes a larger move away from movie players connected to a tv to PC connected to tv, this won’t be quite the impact that’s expected.

Posted By Gary (Minneapolis, MN) : May 1, 2008 1:29 pm

I think the point here is TOTALLY overstated.

I will ALWAYS buy movies I want to own-I am not much of a renter-though I do have a blockbuster online limited account.

Having an electronic copy of a movie on my Mac or Apple TV is NOT the same thing as owning the physical DVD-in a case-with Art Work and the ability of it to survive a total hard drive failure.

Until magnetic media is as reliable as optical media, there will still be a market for DVDs and CDs.

Posted By Enigmanfan420, Seattle, WA : May 1, 2008 1:25 pm

Does this mean movie rentals are available right away too. Apple seemed to say you could purchase a movie, not rent a movie right away.

Posted By Mike, San Diego, CA : May 1, 2008 1:20 pm

So I am left with only a digital file for a movie?

What happens is the case of a hard drive crash? What happens when my kids want to view a movie on the car’s portable DVD player? Can I burn these downloaded movies to disk?

I’d rather that the DVD I bought gave me the option to also download it as well.

Posted By Anonymous : May 1, 2008 1:18 pm

Wow. How can this not be good for the AppleTV?

Posted By Chris, Winnipeg Canada : May 1, 2008 1:07 pm
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