Will Apple TV Take 2 Take Online Movie Rentals Mainstream?
by Duncan Riley on January 15, 2008

appletv.jpgAn extraordinary thing happened today (well at least given who it was), Steve Jobs admitted that Apple had screwed up with its Apple TV product. Never one to take the rap alone he threw in Microsoft and a few others as well as examples of how internet computers/ devices that were meant for TV’s as a whole hadn’t taken off. There was of course method to Jobs’ unprecedented admission of failure: it’s far easier to hype a new product when you denigrate its predecessor first.

Apple TV Take 2 takes off where the Apple TV started with what Jobs claimed was the key feature to driving demand; inbuilt (ie: computer independent) movie rentals. Apple has all the big movie studios, then some others as well signed up to provide content for the service at $2.99 for old titles, $3.99 for new releases (30 days after they become available on DVD). Two key points: the movies offered are HD (720p for memory) and can be viewed within 30 seconds after purchase for those with a decent broadband connection.

Then there’s the price: $229, which unlike the Macbook Air is eminently affordable for the masses.

Apple is far from the first to get into online movie rentals. Only days ago Netflix announced that they’d begin offering unlimited online movies as part of their $16.99/ mth for 3 physical DVD’s at a time deal, and has previously announced a set-top box in conjunction with LG. Blockbuster bought long term online video site Movielink for less that $20 million in August 2007. Vudu offers a couple of dedicated set-top online video rental boxes for $399 and $999.

I’ll admit that I was impressed by the presentation, but it might have just been the salesman onstage. The interface for renting movies is classic Apple simplicity, and renting a movie can be done in a couple of clicks. On the other hand the Flickr demonstration didn’t work and the ability to play music whilst viewing a slideshow of pictures was…well…underwhelming. The Apple TV still lacks two key features that would make it a killer product: a DVD player and a TV Tuner. Both may sound old fashioned but consider that many people may baulk at buying yet another device to plug into their TV’s; with a DVD player built in it becomes a DVD player substitute, with a TV tuner and PVR functionality it’s a TiVo replacement. There’s already a healthy group of Apple fans setting up Mac Mini’s in this exact way.

What do you think? Having learned from the failure of Apple TV, has Steve Jobs now delivered a device that will take online movie rentals into the mainstream lounge rooms of the world, or will this be an abject failure…again?

Will you buy an Apple TV Take Two?

Total Votes: 2439
Started: January 15, 2008

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Comments

Sooner or later - at this rate of tech innovation - people will have absolutely NO reason to ever leave home for entertainment. :-?

Wonder what the competitive response will ultimately be?

 

I believe the free upgrade for existing appleTV users will benefit for all the new software features. Which is great. With the price drop, I may just get one, but there are some new TIVO features coming out that will make my TivoHD more integrated with video podcasts and my downloaded movies.

We’ll see.

 

Fish,
I’m in two minds about it hence the poll and question. At $229 it’s tempting, but do I want yet another box?

 

Has anybody checked to see if the (entire) Vudu staff has killed themselves? Vudu is finished. Take 2 is a much better products. Nice try guys. I’ll put it on my dead pool product shelf.

 

Have they fixed the image quality? The few people I know who have this product have all complained about this, leaving the product most suitable to serious geeks and expats desperate for US TV. And nobody is taulking about this product.

Comcast seems within a short hair of having this as a standard feature on their DVR systems. They already have (limited) on-demand movies, and you can pause/rewind/FF/resume them as if they are local, but it’s all server-based (ugh!). Not sure why they can’t just update their DVRs and offer a huge library of downloads.

 

I might, if it (video rentals) was available in my location (Australia).

 

remember that it’s $229 PLUS the rental fees. What I don’t get (i didnt research i admit) is what’s the difference between this and just getting a ppv on your cable box? besides more selection, what else is there?

 

Hm… IMHO until there’s a TV Tuner in it TiVo still wins with amazon unbox

 

But you can’t surf the net 10 feet away using this!

Someone needs to make a webTV type setup for this decade. A LCD TV with wi fi that syncs with your computer and then displays it on the TV.

I use this, but it’s not wireless http://techavid.com and for the average consumer not something they want to bother hooking up. Though, there is a huge need for something like this!

 

For some reason this AppleTV seems extremely underwhelming to me. Is there really that many people out there just dying to pay for rentals streamed into their living room? Was there any information given as to how long you get to watch your rental for etc?

I think in addition to PVR and DVD capabilities, I would have loved to see the Apple TV also support streaming of content from my PC to my TV. Divx, XVid, etc.

 

This article muddled up the pricing a bit…it’s $2.99 (old)/$3.99 (new) for standard-def movies and it’s $3.99/$4.99 for the HD versions of the same movies.

http://www.engadget.com/2008/0.....e-rentals/

 

I found the pricing to be the biggest drawback.

In the world of my peers Apple is competing with free and they are competing with standard MPEG 2 compressed DVDs (which look pretty good) and full 1080i HD DVD rips.

Offering 720p is nice, but charging more for them? Absurd.

The old model for getting movies was going to blockbuster and picking them up. You spend around 4 dollars for a new movie, keep it for a couple nights, then return it.

A true advance in efficiency would lower the price for consumers, increase choice and simultaneously increase the profits for the studios.

Ideally you could rent all the movies for less than 3 dollars as soon as the DVD versions came out (or earlier) and with all the features/resolution of the DVD/HD-DVD. I can do this right now, but I can’t pay for it.

Studios are trying to chase the physical media hare and the digital distribution hare at the same time, and it’s the consumers who are going hungry for their hubris.

Furthermore it doesn’t help consumers when Apple offers these kinds of terms to get the studios on board. The studios and old distribution channels need to be amputated not put on life support.

-Ian

 

@Allen, Don’t forget you can rent movies AND buy them. Lot’s and lot’s of movies. Heck, I know some families where having an idustructable copy of Cars and Finding Nemo would be a lifesaver.

As to all of the people who want PVRs, I don’t get that either. It’s a part of most cable boxes now, and adding yet another one doesn’t make sense. Especially when you have digital cable and an external PVR wouldn’t be able to interface with it to tune channels, or access premium channels.

 

am i missing something or is the selection on my appletv very underwhelming? same with itunes? the selection doesn’t look like it comes close to a dvd store or netflix.

i thought with rentals, they’d do a much better job than they did with their movie purchase store. right now, it looks to be marginally better.

where’s the content?????

 

@13 Michael Long

Maybe I’m crazy here, but ideally, why would I even need a digital cable box if this apple TV box had both PVR functionality, or even better just the content breadth to allow me to simply pick and choose the shows I want through itunes.

I would love nothing better then to ditch my poor service, poor choice cable connection and PVR for something like this where I make the choices what I want when I want. In an ideal world anyway, but I don’t think this new iteration of the iTV is there yet…

 

Question - why cant the use the same technology as Sandisk’s new FlashDVD memory stick and plug it into normal TVs?

 

Duncan,
Any line on whether international users will get rentals as well? Here in the UK, the lack of TV and movies in ITMS is a joke.

 

@13 - how much is a buy? if its 5.99 fine, if its 19.99 no way

 

Wrong! You can get unlimited online movies with Netflix for ANY Unlimited plan. I get the 1-at-a-time UNLIMITED plan for $8.99/month and I also get UNLIMITED online Watch Now time included with that.

 

I think Apple is on the path to getting it right and will own the living room entertainment domain. All of this discussion about PVR functionality, streaming from device, browsing the net, etc. is really just Geek demand (not from average consumer users) and will be addressed over time.

Remember, this is basically simply a full blown Apple computer (think Apple’s version of MediaCenter but well designed and priced right), I’m sure exposing additional functionality is a question of software updates. OK the PVR/Tuner will require some additional hardware. Anyhow, in 5 years I don’t think the notion of “channels” that need to be captured/stored, will be relevant anymore.

My disappointment is in rental price. Personally, I was hoping for $1.99/$2.99.

In any case, I’m definately buying one and I’m really not much of a gear-boy.

 

“Someone needs to make a webTV type setup for this decade. A LCD TV with wi fi that syncs with your computer and then displays it on the TV. ”

uh, I get that now with Vista and Orb and a media center extender. I can also rent movies online with this system and I just watched all of Heros Season One oneline with netflix on my 52″ LCD TV. I also get High Def PVR with Media Center. It took me all of 5 minutes to set up. Why Microsoft doesn’t tout this more is beyond me.

 

Real AppleTV… it’s only a matter of time. Imagine the convergence of a large (42″+) HD LCD screen with built in DVD, DVR and Apple TV. Add in Apple’s prowess in design and this could redefine the large-set HD category. They certainly have the technology.

 

I think you’re missing the point regarding the lack of a DVD drive in the Apple TV, or really the lack of ANY type of HD drive (BluRay) in ANY Apple device. It boils to lost revenue for Apple. They want to drive your viewing habits through iTMS and buy all your programs and movies there, NOT on DVD. Why? Because they don’t get a cut of anything you buy on DVD or BluRay. In their mind, physical media is a nuisance and just gets in the way. How many iPhones or iPods have a BluRay or DVD drive? None. Can I still rent/purchase and watch a movie on either of those? Yes. And how much money did they make on that? All of it.

I would expect Apple to go “no drive” in most if not all of their portable computers within the next two years. Why bother putting BluRay in a MacBook when you can just go to iTMS to buy or rent stuff. They saved you money, you can’t lose or scratch the media, you’re going to watch it either on your TV or you computer anyway, and you didn’t get caught up in yet another format war. Are you really THAT attached to a 12cm piece of plastic.

DVD drives? Who needs ‘em. Apple’s got their sh*t together on this one.

 

Why spending so much for a tool full of useless functions? Is it a “movie renting” box or a $229.- flickr client?

Why would non-geeks buy such a tool if they can rent movies?

I would have given this tool for a really symbolic price ($49.-). Then with a large client base, they would be in a position to set the rules.

As usual Apple is taking (without hesitation) the money of early adopters….

 

Is this new? My cable system (in Canada) currently offers an ‘on-demand’ channel where I can ‘rent’ movies. There is a big selection, although I haven’t done any research to see if all studio’s movies are available. I don’t have to wait 30 seconds for anything to download and the movie is available to watch for 24 hours. The more current movies are offered on PPV channels.

The 30 day wait for new releases doesn’t help much either. If my local Blockbuster is any indication, I’d guess 80% of rentals are from new releases.

The purchase option I can’t currently do with my set-up, but that isn’t something I would use.

I don’t really see why I would want to purchase this? Am I missing something?

 

I’d consider it…if they offered a movie rental subscription model like Netflix. Pay X dollars a month, have 3 at a time out, something like that. They obviously know how many movies you haven’t started so shouldn’t be too difficult.

On average, we rent about 5 movies/month (sometimes more) from Netflix. We’re on the 16.99 plan. 5*3.99 is about $20, so still more expensive, and you get them 30 days later.

Also, TV shows are still WAY too expensive. $1.99/episode I could see for new shows, but I’m currently watching Charmed through Netflix and there were 8 seasons of that. There’s no possible way I’m spending that much to watch a TV show. I might as well buy the DVDs (which I don’t want to, since it’s not a series I want to keep).

I think I’ll wait to see if they come out with a subscription model or something, or lower their prices.

 

Don’t forget about the Xbox 360. Movie Rentals as well, on top of a DVD player, DIVX player, video game console, media center, photo viewer, IPTV, and more. With expandable HD DVD player and rumoured BluRay player.

Also, Rockband is the best video game experience since Wii.

I love it!!

 

What I would do is: drop the price by a dollar: 1.99 / 2.99. And then change the time limitation (from start) to 48hrs instead of 24.

If that happened, I would drop my Netflix subscription (or at least lower it — I did watch a lot of Anime). One thing that Netflix still has up over Apple is with Episode based titles. You can get a single DVD with 3-5 episodes on it whereas Apple requires you to get each episode independently.

 

I’ll buy one if it’s easy to make it play other file formats, like DivX/XviD in AVI.

AppleTV with only MPEG-4 content isn’t compelling, just like the iPod would have been a failure if it had only been able to play .m4a and .m4p files.

 

Perhaps it may lure the masses into purchasing movies using through online rentals but I agree with a previous post, do we really need another box that’s limited (in this case by the iTunes library)?

Unless Apple beefs up AppleTV (say for instance, apple buys slingmedia and integrates the best features of their two products: AppleBox anyone [lol] - watch live tv on the iphone wirelessly) or figures out a way to get movies earlier/exclusively on itunes, the masses will discern no real ‘need’ for another media box regardless of how easy or inexpensive it makes the process of renting movies .

 

I’ve been using a Mac Mini + Eye TV as my media center for about a year. Itd awesome … but I’m worried that Apple is putting features into the $229 Apple TV and witholding them from Leopard/Front Row. Hook us up already Steve !

 

I am an Apple fan, but this won’t work for me unless they decrease their prices or propose a subscription model. $3-$5 per rental is absurd. For now, I’ll stick stay with Netflix.

 

I still believe Apple and Steve Jobs made a HUGE strategic error by not taking what I offered it two years ago in connection with iPod. Specifically, “Moviepod” which did and does what neither Apple nor any of the others, including Netflix, have ever figured how to do: namely, forget about trying to get people to pay up front for movies and other video content, including television reruns, when sooner or later they can rip it off from the Web for free.

What Jobs apparently dissed was this: You place your content in something called a “peerpod” (which works like a video iPod in a shared information space). This approach allows one, two or as many as six individual advertisers in brand name “peerpods” to sponsor the content because the brand channels that stream the content are themselves attached to hundreds of product or service specific “peerpods” that have been layered across the public Internet since” 1998.

This method allows multiple sponsors in the product or service “peerpods” to microcast their creations directly to audiences of one person or one household without having to package, to stream and then try to extract a profit based on an item that retails for $2.99 or even $3.99 inside the walled garden presently occupied by Apple.

And where are the leftovers for the content producers after Apple gets through selling the content? The margins probably aren’t there, which means at the end of the day nobody makes any money, including Apple, UNLESS Apple intends to package the ads into each and every stream.

Movies are not songs. Three or four dollars isn’t chump change when you can get the same thing from Turner Classic Movies and other sources, including online sources, for free.

Who is going to be foolish enough to pay three or four dollars up front to sell advertising to themselves, which is what the movie distributors quickly found out when they started to offload numerous promotions for additional movies burned into DVDs.

 
 

As much as I hate extra boxes I hate even more those awful combination boxes that ultimately have one dead VCR and one working DVD. I’ve been down that road and there is a reason component systems have survived. Why would Apple add things like a DVD to a internet video appliance. That is like straping an engine on a buggy-whip.

I applaud Apple for upgrading the existing AppleTV units and giving the 900k+ early adopters the newest version. I think the thing that distinquishes Apple more than anyother player is the complete universe of products that can take advantage of the rental of movies and videos: iphone, ipod, Mac, PC, AppleTV. Nothing else ofters that.

 

I agree with the article. For semi wanna be geeks like myself, buying a box that costs more money if I want to do anything with it is out of the question. Now if it were my TV Tuner, DVD Player, and Digital media Hub, now we’re talking worth shelling out some bucks.

 

Being one of the few people who actually bought the original Apple TV, I think some of the comments above focus too narowly on the new video rental feature. I bought the Apple TV as my ‘house IPod’, i.e. a simple way to display my digital photos on a large HD Plasma TV and play my Itunes music library though my home sound system. It could also play movies I purchased on Itunes but the selection and price never interested me.
My wife (who is not facile with hardware) can show our latest family trip photos to her friends in our living room by using the cute, simple Apple remote . The whole system works seamlessly and has been trouble free. I realize there are other hardware devices that could provide this capability, Xbox, PS3, etc. But they all cost money and several devices might be required to achieve the same functionality. Simplicity of packaging and ease of use is a trademark of Apple. As is its premium price.

The Take 2 (now priced at $230) will add stand alone movie rentals with a simple software upgrade (free) to my current box. Pretty slick. These rentals may not be much cheaper than Blockbuster or pay-per-view (we have Dish), but if they provide a good selection of newer films, I can see converting our Netflix to the $9 (unlimited but only 1 at a time) to ensure access to their large library and use both services to optimize selection and convenience. So rentals plus IPod functions plus simplicity makes Apple TV ideal for my needs.

 

We just bought the Apple TV and use in conjunction with an Elgato Eye TV. It has all we need. We plan on getting rid of all of my cable channels and buying episodes as we see fit. We are a family of 5 and even if we buy 25-35 shows per month we will still be cheaper than cable. The majority of what we watch is off air HD networks. Eye TV records and exports to Apple TV within an hour completion of the show. Other than sports, everything we watch is delayed so we can skip ahead. An hour show is easily watched in 40 minutes. We can watch show together as a family when we ant and after homework and kids events. It is also much easier to go mobile. Each kid has a video ipod and watch content anywhere.

 

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