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Apple and Fox Team for Online DVDs

Apple and Fox Team for Online DVDs

The slow but steady transition from DVD to VOD, has taken one giant leap further. Apple and Fox are reportedly joining forces to launch an online video rental service via iTunes. If this takes off, which it should, the implications are huge. Anyone, like us, who dedicates time to watching Netflix rentals online (thanks to the company’s new Web-based service), can tell you that it’s seamless. If I could rent movies on iTunes, you better believe I’d sign up instantly. The next big possibility, however, is the chance to “rip” DVDs onto your iTunes video account. Imagine that: doing for your DVD collection what iTunes has done for your CDs. Expect more hard facts to come with Steve Jobs’ annual keynote at the January Macworld Expo. For Business Week, Arik Hesseldahl gives us an update on this deal-in-progress:

Apple may have resolved disagreements over how best to protect copyrighted work by agreeing to license its FairPlay digital rights management technology to Fox. Until now, Apple has been loath to license FairPlay, a technology that keeps music and video content tied to a customer’s computer, iPod, and iPhone players. It also limits the number of computers to which the content can be copied.

Terms of the agreement concerning FairPlay are as yet sketchy, but reports say Apple will allow future Fox DVD releases to be “ripped” to iTunes collections in much the same way that music can be ripped from a CD. While it’s already possible to do that with existing third-party software such as HandBrake, studios generally consider such actions the equivalent of piracy. Making FairPlay available to Fox might indicate Apple’s willingness to make it available to other studios, which might in turn be more willing to sell and rent their movies on iTunes and to make their DVDs iTunes-ready. To date, only Disney (DIS) sells new movies on iTunes, while studios like Lionsgate (LGF), Paramount, and MGM sell movies mostly from their back catalogs.

Also unclear is how widely and how long movies will be usable. Earlier rumors had said that movies would be playable for 30 days for a price of $2.99. Presumably the same time limits would apply to use on a computer as on an iPod or iPhone.

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