The Video iPod Cometh

by James R. Stoup Jul 18, 2005

Did you know that Apple has dropped the price of its iPods? I realize it isn’t earth shattering news so I will forgive you if you might have missed that particular press release. What with the Intel bomb shell being dropped most people have been looking the other way. And that really is the genius of the situation. Love him or hate him you must admit that Steve Jobs is a showman of the first order. And while he isn’t a magician exactly he has mastered the art of the “media slight of hand”.

And by that I mean he is quite skilled at having everyone looking one way while the action is happening in another corner. Then, with his customary flourish, he whips off the cloth revealing his latest surprise. That simple bit of misdirection is what separates the mediocre performers from the truly inspired ones. The gift at making everyone look at your left hand while your right one holds the coin. So, which hand should I be looking at now and what is in it?

Well, I must confess, from the first time I heard about the move to Intel I was shocked. But after a while I began to really analyze the situation and I realized just how odd it was of Mr. Jobs to announce the switch when he did. Now, I have heard all of the explanations and found them wanting. I didn’t know why at the time but I was convinced that something wasn’t right. Something didn’t add up. I was looking at the left hand, then back at the right hand, all the while attempting to guess which hand I was supposed to look at. Well, I think I might finally have a handle on things thanks to Mr. Cringely.

If you read his article you will find that he predicts Apple will release a Video iPod in the near future. Furthermore, he feels that a ITMS for movies is right on its heels. 3 months ago, back when I wrote mainly on, I posted a piece that detailed what I thought it would take to make the Video iPod possible. Now, with the release of Quicktime 7 several of my points have been resolved. But it is still worth a read to give you a little bit of background on my thinking.

But let us please get to the heart of the matter. I for one think it is a foregone conclusion that Apple will release a movie service much like the ITMS. In fact, they might as well just change the name from iTunes Music Store to the iTunes Media Store. So, I am going to believe that the ViPod is on the way and along with it is the new and improved ITMS. That just leaves one main area to be discussed, what will the DRM be like on these downloadable movies and how much will they cost?

Let me hit cost first off. Since Netflicks and Blockbuster will let you rent all the movies you like I don’t see Apple heading in that direction. They don’t think it is worth it for music and so I see no reason for them to change their position for movies. So, renting is out, that leaves straight purchasing. Now, if you go to Walmart you can snag a DVD anywhere from $4 or so for the really old or crappy tittles, $12-14 for your average tittles and $18-26 for the really special/popular/new/collectors edition/whatever tittles. Well, those are the average prices for retail so what will Apple charge?

Or maybe a better question is what are you willing to pay? Me personally, I don’t think I would pay more than $10 for a DVD I could download. Because if you think about it there is a lot of hassle involved to watch your new movie, much more hassle than just listening to a song. For example, you download Rocky V. Great, it is now on your harddrive, were you planning on watching it on your computer? If the answer is no then you need to go out and buy a ViPod, transfer the movie and then plug that into your TV. Now, this was something you didn’t have to do if you wanted to just buy a song. But wait, you say, what if I went with plan B. Instead of buying a ViPod I purchase a much cheaper mini receiver. I then stream my movie off of my airport base station into my mini receiver (which is attached to my TV) and watch my movies that way. Well, that would work I suppose but you would still need to buy a transmitter and a receiver to make this setup work. Well, I suppose you could just run cables from your computer to your TV but wouldn’t that kind of defeat the point?

Anyway, here I am talking about implementation when I wanted to talk about price. So, let us get back to that topic shall we? Before I got distracted I was trying to point out that all of the extra hassle involved is going to affect the price. Since I need extra equipment to make this whole thing work there has to be some big incentive for me to use this service. And really, the only thing that could be a big enough factor to grab the attention of the fence splitters is price. Everything else (instant access to movies, extra content. etc.) is nice, but price is going to be the deal breaker. I mean, come on, how many of you buy songs off of ITMS for the cover art that comes with them?

So, I remain firm in believing that $10 is the magic number for your average titles and maybe bumping it up to $15 or $20 for the really special deals. But then again I could be wrong, Apple might just want to stick with its one price fits all and just charge a flat $15 for every movie. So, you would overpay (drastically) to see “Star Wars Episode 1” but would under pay to see “Apollo 13”.

Ok, so if we go with the flat rate of $15 we still have to decide on the DRM rules. For instance, should you be allowed to burn your movies to disk at all? Should you be forced to stream them to your TV or ViPod and just leave it at that? I don’t think that is fair but one can imagine that the movie industry will want to bleed you dry for every damn cent they think they can squeeze out of you. But maybe Apple will say you get 3 burns for your movie, you can share it on 6 computers and stream it to as many TVs as you like. Would that be fair? I don’t know really because if you just buy the movie from Walmart you can copy it and do with it as you like. Of course how many of us actually copy DVDs?

And furthermore, since we don’t treat songs like we treat movies should they have similar DRM rules? And how expensive do you think a ViPod should be? How big? Is 80 GBs enough? 100 GB? All of these are interesting questions and I look forward to an array of unique insights. So, what did I miss, where am I right and where am I wrong? Let me know by commenting below.


  • Very interesting insights. I think you have it mostly right. At least as far as how it should go. I do think, however, that there is no way a single price for all scheme will work for movies. Not all movies are created equal, and while the same holds true for songs I find it a lot easier to swallow paying 99¢ for a song I only sort of like than I would paying $15 for Earth Girls Are Easy or any of the Police Academy movies (not that I would entertain the idea of owning some of those). And, as far as DRM goes, I think Apple (and the studios) has to allow us to burn to DVD a few times at least. We have to be able to at least make a back up. I would like to see the ability to burn to disk at least 3 times with 5 being preferred and be able to play on at least 3 computers if not 5. The iTMS has set the standard, it would be great if it was the same rules across the board for the Media Store.

    Gabe H had this to say on Jul 18, 2005 Posts: 40
  • Downloadable movies are not coming anytime soon. This a fantasy being cooked up by so many people without really applying logic behind it.

    1. I pay on the average $10 for an actual DVD. I have hundreds of options below $10 for decent movies from sites like No way am I paying $10 for anything but the most recent digital download.

    2. AVC allows Apple to drastically decrease the video file but with movies you still need menu, subtitle, language tracks and extras. What encapsulation method is going to be used for this?

    3. Apple isn’t paying for my bandwidth. I don’t think my ISP is going to like me downloading Gigabyte files every other day.

    4. As a Netflix user I find myself purchasing less movies and renting far more. My average disc cost is under $1.99. The only way I see a download movie service as viable for my needs is if I “must” have a movie that night. Scenarios like that happen what…maybe once twice a year.

    In 5 years we might be ready for this. Right now I don’t think it’s really feasible.

    hmurchison had this to say on Jul 18, 2005 Posts: 145
  • I’m sorry, but it’s all bad. I mean, maybe I am not your average consumer, but I just don’t buy from the iTMS because the mere thought of spending money on compressed music makes me cringe. I’d rather have a CD or SACD-Hybrid & rip it to ALAC for portable use. I don’t want to download music, I want to own it, in the flesh & highest quality possible.

    Movies are different, a high-res, high-quality experience is not really possible in a consumer-friendly package without compression at this time. Laserdisc is still great for collectors, but Joe Shmoe had & has as little appreciation for it as he has for vinyl.
    In fact I do see myself as a potential movie download customer since I more or less own the movies I want to own, but there are X other movies I would like to see nonetheless. But I would not want to own them, and I would not want to shell out $10 / €10 for downloading them.
    I would like to rent them, rent them without all the hassle that renting a movie brings along (scratched discs, having to pick them up & return them). I want to sit down in front of my TV, select a movie from an iTunes-esque interface, have it buffer for 5 minutes or so & then have it there as if it was the physical DVD. I would not want to pay more for this than I would pay in any brick&mortar; or internet-based DVD-rental, rather less. I would want to have age-authentification so I as a mature person have access to mature content.
    Movies on the go is rather pointless for daily commute, it works for travel though. Do you travel enough to buy a device that is only really useful for travel? The money is in home rentals. Give me a small scale (Mac mini?) WLAN receiver with *high quality* composite, component & digital video output (for DRMd HD), analoge & digital sound output to hook up to the TV/home theater. Give it plenty of physical memory & maybe a 10GB HD. Give it FireWire & USB2 so one can happily stack HDs in the same way it is done with the Mac mini right now. This thing should also be able to hold or control your iTunes lib and stream to your APX units, so we need a good RF remote with a display. 399.

    Bad Beaver had this to say on Jul 18, 2005 Posts: 371
  • Movies are completely differant to music, people like to own music, but the mindset in movies is towards rental. No one is going to pay such a high price point ($15) for a Hard Drive Hog of Police Academy 6, so the ITMS should it ever come to pass would probably allow a few watches or expire at a certain time.

    barrowman had this to say on Jul 18, 2005 Posts: 15
  • $5-10 would be a good price. Any more and netflicks makes more sense, or going to blockbuster down the street. A ViPod would be awesome, but the drive would need to be HUGE. I already have more than 20 gigs of music, and videos will take up much more room than a simple song. I’m sure many users will not only want to put downloaded movies on the pod, but home movies as well. Also, I dont download music because I enjoy the full package (the case, the real artwork, the lyrics, the disc). I am the same way with DVD’s (minus the lyrics lol). For me to want to download the movie the price would have to be considerably cheaper. Keep in mind it will be compressed and not the full DVD quality. Crazy.

    d e l e t e p l s had this to say on Jul 20, 2005 Posts: 5
  • barrowman is right: people will want a subscription and a buy service for movies.

    Netflix is already developing such a service. They have already digitized their massive collection (that grows day by day). Apple will have already needed to digitize content or they are too late.

    Next year, Netlfix will announce their service - and enhance their already top-notch website. Apple, lest they fail us, has to have a solution in development.

    Nathan had this to say on Jul 28, 2005 Posts: 219
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