Quote Originally Posted by Ajani
Ok.... I can't believe I'm sticking my foot in a format war thread... but here goes:

Isn't the biggest threat to either format not each other or even traditional DVD, but downloadable content?
Why can't you believe it? Here you are.

As I've pointed out several times, downloadable content does not threaten disc media so long as the files themselves are locked down with usage limitations and expiration dates. With those limits in place, downloads are nothing more than an extension of the PPV, VOD, and rental markets. The DVD has turned the home video market into a purchase-driven market, where consumers expect to keep the content that they purchase and have unlimited access.

Quote Originally Posted by Ajani
I think both HD DVD and Blu Ray shoud be sweating now that Apple TV will be allowing consumers to buy/rent HD Movies from the comfort of their sofa. And I don't think apple wiil be the last company to provide such a service... I really think that downloads are in and physical media is on the slow crawl out (or at least to a niche market, much like vinyl)... I don't think the current MP3/4 generation is really that interested in a stack of optical discs lying around the sofa when they can just have it all stored in a tiny box attached to the tv...
And how different is Apple TV from any of the other PPV and VOD options currently available? There is a measure of selection and convenience that Apple adds to the market, but fundamentally they are not all that different from services that are already on the market.

Remember who holds the keys to the content -- the studios. Disc media is a high margin, low cost product with an established distribution network. Downloads are an unproven market, with lower revenue per transaction and a Balkanized distribution network with separate deals and conditions having to be negotiated with each distributor. Apple is a significant player in this market, but they're a big fish in a little pond. The 24-hour viewing limit on their new Apple TV movie downloads is an indication that they currently hold little sway with the studios, otherwise why would Apple agree to these kinds of restrictions? Until downloading can demonstrate much greater revenue potential, the studios will continue to give priority to retail sell-through products.

As far as the "tiny boxes" go, how many movies can an Apple TV unit store? In high def, an 80 GB unit will run out of space in a hurry. If consumers have to keep deleting movies in order to watch new ones, then this is no substitute for a "stack of optical discs" since those "tiny boxes" would only place a very short stack of those optical discs.