Movies will be rented to consumers...not sold. People familiar with the situation report that the download will be coded with a date stamp restricting playback. If this is true, it will diverge from Apple's iTunes Music Store and possibly impact the company's dominance of the digital content download market. Sites such as Movielink and Guba feature download-to-own services, which make them even bigger competitors to Apple (but without the big brand name). "We knew that Steve [Jobs] saw the rental model as the only viable option," a person familiar with negotiations commented. "We knew it was a matter of time before he signed on."

The subscription business does have its benefits: Apple profits as do the movie studios. The question is if (or how soon) will Jobs try to move into the downloadable movie-for-purchase space in order to take it a step further to gain complete control over the sale of movies? This first initiative is a fine start, as the stock is up today, and will likely to continue to rise with the conference approaching.

Jobs to announce iTunes movie store originally appeared on BloggingStocks on Tue, 18 Jul 2006 13:30:00 EST. Please see our terms for use of feeds.