iTunes and Amazon.com recently came out with some new offerings which includes download of full-length feature films. I was surprised that the price to download a movie ranged on iTunes on average from $9.99 to $19.99! Which is pretty much on par with what it would cost you to buy a DVD. In a random sampling of friends and colleagues I asked "how much are you willing to pay for a movie download?" The response ranged from "no more than I would pay for a rental - $4.99" to "much less than I would have to pay to buy a DVD". Not surprisingly - not one person was willing to pay the equivilent of a DVD purchase. So far Walmart has been the price leader in music downloads, and being the #1 seller of DVDs online its only a matter of time until they have a similar offering.
Amazon's unbox offering was underwhelming. Similar pricing to iTunes, but more surprising is the DRM issue. As I understand it, Amazon will install DRM software on your computer, reserve the right to update the software. If you refuse the updates, you then can no longer see your movies. Thats not exactly what I would call "user friendly"!
It will be interesting to see what impact these issues have on iTunes and Amazon's movie business. I for one am getting tired of paying $1.99 for TV downloads - I fall into the "not willing to pay more than the price of a rental" camp. I am all for downloading and paying for legal downloads - but I have little tolerance for DRM issues that inhibit my user experience. I believe most people will find other means to convert DVDs to iPod or will continue to use P2P services until there is an alternative pricing model and user experience that makes sense.
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