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Apple subtracts one advantage

Tuaw_logo Reader James Lubin of Los Angeles pointed out something I'd overlooked in my post Tuesday about Apple's new movie rental service. One of the differentiators between Apple and other downloadable movie sites is that rented films can be transferred to pocket-sized portable players in addition to laptops. Previously, that was something only DivX-enabled services such as Film Fresh could do with rentals, and until this month, no major studio had approved the use of DivX's DRM on its movies. But Lubin pointed me to a post on The Unofficial Apple Weblog reporting that movies rented from iTunes can be transferred only the latest iPods, i.e., the Touch, the Classic, the iPhone and the redesigned Nano.

That restriction, which probably stems from the different DRM capabilities of the earlier generations of iPod, takes millions of potential players out of the picture. That may not be a big deal; watching a feature film on a 2" screen isn't a mass-market activity. On the other hand, those iPod owners no longer have a cheap and brain-dead simple way of getting iTunes movie rentals from their computers to their TV screens. Instead of plugging the iPod they already own into their TV set via a cheap cable, they'll have to buy an Apple TV for $229 (unless, of course, their computer is next to their TV set).

It's possible that the earlier video iPods could be brought into the rental fold through a firmware update, but it may also be the case that the new DRM requires new hardware. Hardware limits appear to explain why the older video iPods don't offer the same picture quality as the new Classics do (4x3 480P on the former, widescreen 480P on the latter). Regardless, diminishing the iPod advantage narrows the gap between the Apple movie rental service and its competitors, reducing the chance that iTunes will give the movie download market the long-awaited breakthrough hit that Apple supplied the music industry.

-- Jon Healey

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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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