First, in anticipation of the announcement that everyone was expecting from Steve Jobs during his Macworld keynote address, Netflix ditched its online movie viewing quota. Steve O'Hear from Last100 explains what that means:
As of today, all subscribers except those on the most basic two DVDs per-month plan will be given unlimited access to the 6,000+ movies available as part of Netflix’s Internet streaming option, dubbed "Watch Instantly". Previously, subscribers were offered a limited number of Internet viewing hours based on which DVD rental plan they were on.
This is really cool, especially since Netflix has a subscription model and doesn't charge on a per-movie basis.
Second, as expected, Steve Jobs announced Apple's entry into the online movie downloads space during his keynote address yesterday. To see how this stacks up against Netflix's model, O'Hear compared the two based on (1) content, (2) pricing, and (3) convenience.
Each offering has its pros and cons: Neither has the upper hand in content, Netflix has better pricing (subscription model), while Apple has greater convenience (great hardware-software coupling and the ability to watch the downloaded movie on multiple devices). Of course, both are still limited by telecommunications infrastructure (especially Apple's movies-in-HD offering for Apple TV) and the reluctance of movie studios to fully embrace the online rental concept. And though the market for online movie rentals is still small, it is growing (thanks, in part, to the writer's strike).
So, at this time, it's not clear how things will go. What I do know is that 2008 should be a fun year in online movie rentals.