Apple Allegedly Prepping Movie Rental System

If recent pieces in the Wall Street Journal and Financial Times are any indication, Apple will be debuting a movie rental feature on iTunes in a number of months. Autumn ’07, the mysterious Apple tipster(s) have stated. Big deal? Small deal? Medium-sized?

I’m leaning towards small, but if all goes as I hope all goes, medium-sized is where things’ll end up. Here’s why.

A little framework before we talk about content. If Apple’s serious about the Apple TV (the company’s devotion to the product is suspect considering CEO Steve Jobs open admission at the 2007 iteration of the D5 conference that the device is little more than a “hobby”) the company will need to toss out the requirement for Apple TV-to-PC synchronization before it can really give consumers what they want.

Apple will absolutely need to maintain the Apple TV’s ability to mate wirelessly with Macs and PCs installed with the latest and greatest iTunes software. But the Apple TV should nonetheless be capable of thinking for itself beyond making simple requests to view movie trailers and access the iTunes Movie Store to make rentals/purchases from the convenience of one’s couch and with only the use of an Apple Remote.

There’s no doubt in my mind that Apple dreamed of such simplicity from the conception of the Apple TV, but there were likely several obstacles on the side of the content providers, as well as other factors, that led Apple to release its TV portal in relatively lackluster, “beta” form.

When Apple and its content partners have these hindrances ironed out, a rental/purchase system can be realized.

Over-the-Web rentals are available to consumers in many venues and applications, and companies among the likes of Microsoft have already bridged the gap between Web and TV to allow downloads to travel directly to consumers’ entertainment systems. In terms of passively consuming entertainment, however, the Xbox 360 isn’t the most pleasant medium to utilize. (Viewing feature films, for example.) We can be sure to expect future software and firmware updates for gaming consoles to further emphasize video entertainment, but at the moment, blockbuster movies take a back seat to blockbuster games.

So there remains a void in the world of over-the-Web rentals, and Apple is not one to let such a potentially lucrative business go unoccupied. It will need to bridge the gap fast, though, as many players are likely scrambling to assemble their own products to establish domain over version three (version 1, brick-and-mortar chains; version 2, the Netflix idea) of the video rental industry.

All that’s left to ponder about Apple TV is what the pricing structure will be. The number floating about the Web is $2.99 per rental. Sound good? I hesitate to say yes or no, considering how successful the tiered pricing structure has been for Netflix, Blockbuster, etc. For Apple to establish an equivalent would be very attractive indeed, though perhaps movie downloads (granted that they be formatted with DVD-or-better video quality) should carry with them a slight premium so as to dissuade consumers from taking advantage of any 3- to 7-at-a-time rental plans the company makes available.

In all, $2.99 per rental sounds like a reasonable figure to start with.