April 3, 2008 / 7:20 PM / 10 years ago

Movie download services bypass discs

SAN FRANCISCO (Reuters) - Forget DVDs. Several services now let you download movies and play them right on your TV — no disc needed.

An Apple TV device is seen in an undated image. REUTERS/Apple/Handout

These virtual video stores promise near-instant delivery of hundreds of movies, including many in glorious high-definition, all ordered up from the comfort of your couch.

Well, it’s almost that easy. The services require you to shell out several hundred dollars for special hardware first; they also demand a bit of set-up, and rely on a fast Internet connection.

“Now there is sort of this battle for what the next generation of device is going to look like, and for some people that device is not really based on optical disks but is optimized for downloads,” said Michael Gartenberg, an analyst with Jupiter Research.

“There are lots of merits but the question is how much content can we get on these devices?”

If you’re someone who sees Apple as a lifestyle, you’re probably aware of Apple TV, the latest multimedia product from the folks who brought you the iPod and iPhone.

Apple TV went on sale a year ago, but it only acted as a bridge for video and music to cross the gap between your computer and television. Sluggish sales led to Apple founder Steve Jobs taking the wraps off “Take Two” in January.

The upgrade unshackles Apple TV from the computer and allows users to browse Apple’s iTunes online store directly on a TV set. The addition of rentals quelled complaints about the previous buy-only service.

In true Apple fashion, the Apple TV box is a stylish piece of hardware, wrapping a processor, hard-drive and wireless link in a minimalist white box.

Apple says it has nearly 1,000 movies for rent, with about 175 of those in high-definition.

One selling point is that you can transfer Apple TV movie and TV show purchases (but not rentals) to a computer, iPhone or some video iPods.

“The shows you purchase from Apple are going to float fairly seamlessly to other screens. You’ve got all the screens someone might be interested in watching something on covered. That’s a huge strength for Apple,” Gartenberg said.

Apple TV costs $229 for 40-gigabytes of storage that can store 50 hours of video, or $329 for quadruple the memory.

If you’re one of the nearly 10 million people in the United States who have bought Microsoft’s Xbox 360 video game console, you have a video-on-demand service right at your thumbtips.

In late 2006, Microsoft beefed up its Xbox Live service — previously simply an online hangout for gamers — with movies and TV shows for download.

Microsoft offers more than 300 movies for rent, about half of which can be viewed in hi-def. Including TV shows, Microsoft says it has more than 4,000 hours of content.

The selection is more limited than other services partly because not all studios have struck deals to put their content on the service, though Microsoft says it’s hopeful that will change soon. Microsoft also says it picks movies that appeal to its core audience of young males, which explains the preponderance of teen comedies and horror movies.

Xbox 360 prices range from $280 to $450, but the cheapest model does not include the hard drive you’ll need to store the videos. The $350 Premium model has a 20-gigabyte hard drive and the $450 Elite ups that 120-gigabytes.

Microsoft reckons that expanding the service will make its machine more attractive to potential buyers than Sony’s rival PlayStation 3 console, which has a built-in Blu-ray drive.

“One thing we think about is how to add features to a video game console to broaden its appeal. We realize that an Xbox is probably firstly, secondly and thirdly used for games,” Ross Honey, senior director of Microsoft’s media and entertainment group, told Reuters.

“But by saying, ‘By the way, you can download hi-def movies,’ that may in fact make the difference in a purchase decision, especially when a wife or girlfriend is involved,” Honey said.

TiVo, the popular digital video recorder already in many homes is another device that can be configured to act as a video store in a box.

A deal with online retailer Amazon.com lets some TiVo users rent videos from Amazon’s Unbox service. Since last July, TiVo owners have been able to use their machines to download directly from Amazon’s library.

TiVo owners do need to configure their machines to sync with an Amazon.com account, and some older machines won’t work. Unbox also can’t be used with TiVo service offered through the DirecTV satellite provider.

Amazon has thousands of movies and TV shows on offer. A search for “unbox” on the site returned more than 11,000 results. None are in hi-def yet.

TiVo boxes come in many configurations and price points, from less than $200 to more than $600 depending on the number of tuners, the size of the hard drive and whether it supports hi-def. There is also a service fee that can be paid monthly or in a lump sum up front for the life of the product.

There is remarkable price uniformity among Apple TV, Xbox Live and Unbox. Newly released movies cost $4 to rent, with hi-def versions going for a dollar more.

These three services are by no means the only options for downloading movies to watch on your TV. Cable companies have growing on-demand services, a start-up called Vudu makes a box to rent or buy thousands of movies, and there are ways to tweak a Windows PC to watch movies downloaded from the Web.

“The one thing that’s clear is that in a couple of years, movies themselves are going to be downloaded and consumed differently than they are today,” Jupiter’s Gartenberg said.

And in the event you still can’t find anything to watch, you can always get off the couch and head to the video store.

Reporting by Scott Hillis; editing by Gunna Dickson

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