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If Warner Bros.' decision to go exclusively with Blu-ray Disc was an industry-rattling earthquake, Monday's news that Netflix would begin to phase out HD DVD rentals is an inevitable aftershock: much smaller impact, potentially damaging, and still leaves everyone feeling unsettled.

By the end of the year Netflix will no longer offer HD DVD movies to customers, opting to exclusively stock Blu-ray Discs in its online rental service. In the company's announcement, Netflix said it made the decision based on Blu-ray's recent momentum--Universal and Paramount are the only remaining major Hollywood studios with agreements to release titles exclusively on HD DVD.

For HD DVD backers like Toshiba, Microsoft, and the studios, Netflix is probably yet another sad loss, but it won't have the demoralizing repercussions the Warner decision did.

But for the average consumer, in reality, not much changes. That's because the overwhelming majority of DVD renters don't rent high-definition discs. In fact, most of Netflix's own customers don't rent high-def discs. But those who did were renting Blu-ray more than HD DVD, hence Netflix's decision.

Sure, Netflix is one less place to rent HD DVD, but finding copies of the beleaguered disc format is not impossible--Blockbuster stores don't offer HD DVDs to rent, but its online rental service still stocks both formats.

In all, the announcement doesn't do much to make the muddled format picture any less murky for consumers right now. High-definition video players and discs are still too pricey for most buyers, and the quality improvement over DVD isn't as apparent to anyone but the hardcore videophile crowd. Plus, standard DVD players that can convert discs to high-def resolution get the job done reasonably well. Until any of that changes, high-definition video will be stuck in neutral no matter which studio or rental service makes an offer of exclusivity.

Update: The HD DVD Promotional Group's response: "We have long held the belief that HD DVD is the best format for consumers based on quality and value, and with more than 1 million HD DVD players on the market, it's unfortunate to see Netflix make the decision to only stock Blu-ray titles going forward."

For further discussion, hear the guys at CNET's The 404 talk about it on Monday's podcast.

It's going to be a few more days before the world gets a crack at the new and improved Apple TV. Looking to kill some time during that interminable delay? It's a perfect opportunity to check out the major competing hardware options that already offer the same on-demand Internet movie rental functionality.

Video rental comes to the iPod. Can Apple finally make download video rental succeed for a portable device?

(Credit: Daniel Terdiman/CNET News.com)

From an iPod perspective, the biggest announcement from Macworld 2008 has to be iTunes video rentals. Beginning in February, those of you who own an iPhone, iPod Classic, iPod Touch, or 3G iPod Nano, will be able to rent and transfer movies from iTunes. iTunes movie rentals will be priced at $3.99 for new releases and $2.99 for older titles. While I'll have to wait and see how well renting movies in iTunes works, at first glance this looks like a huge win for the iPod.

Only a few competing MP3 players have dipped their toes into integrated video rental services. Specifically, the Archos line of portable video players and the Samsung YP-P2 have an arrangement with CinemaNow, which allows identically-priced movie rentals. While Apple might not be the first to pioneer DRM-protected movie rentals, no one has pulled it off at this scale. The built-in audience of iTunes users and iPod owners provides a staggering amount of leverage for Apple to completely change the way people rent and watch movies. But will it really stick?... Read more

(Credit: CNET Networks)

Among the new product announcements at the Macworld 2008 keynote, iTunes received a brand new feature: movie rentals! With the latest version of iTunes for both Windows and Mac, you will be able to rent movies from all the major studios including Touchstone, MGM, Miramax, Lions Gate, Fox, WB, Walt Disney, Paramount, Universal, and Sony. Apple was able to strike a deal with studios which allowed iTunes to receive new releases 30 days after the DVD release. The first wave of movie rentals will launch by the end of February with over 1,000 titles.

Top movies like Ratatouille will be available by the end of February

(Credit: Courtesy of Apple)

Once you find a movie you want to watch in iTunes, you'll be able to use your iTunes Store account to rent the title, making it available on your computer to begin watching for 30 days. Clicking play starts the movie stream in about 30 seconds. Once you start the movie, you'll have 24 hours to finish it, whether you transfer it to your Apple TV, iPhone, or iPod Touch. You can watch the movie as many times as you want in that 24-hour period.

Rented movies are easily transfered to your iPhone and iPod.

(Credit: CNET Networks)

Owners of Apple TV will be able to purchase and download TV shows, music, and more, directly on your Apple TV. This latest version of iTunes will let you transfer purchases made on Apple TV back to your computer.

Rentals will cost $2.99 for library titles and $3.99 for new releases. If you want HD quality, you can rent titles for only a dollar more at $4.99.

The long-anticipated set-top box from Netflix is headed toward your living room this summer, according to several major news providers including the Associated Press, The New York Times, and Reuters. The good news is that unlike the optical supremacy battle going on between HD-DVD and Blu-Ray, the capability to tap into Netflix's movies-on-demand service could become a standard option on many upcoming consumer-level DVD players and set-top boxes as an added feature--not the sole purpose. Boxes equipped with the Netflix service (including the purported next revision of LG's flagship BH series of dual HD-DVD and Blu-Ray players) will be able to tap into Netflix's on-demand service that streams movies without having to wait for the discs to arrive in the mail.

There's no word on price, exact release date, or the inclusion of an a la carte rental system similar to Vudu or the one that's rumored to be coming to iTunes and Apple TV later this month, but based on Netflix's existing model, it looks like the company is trying to help take a step out of getting on-demand movies on the TV from the PC for people who don't want to shell out for a media extender, or other streaming device.

In addition to LG, Netflix is reportedly making deals with other hardware manufacturers to get the streaming service bundled in upcoming players and game consoles, although with Microsoft already having its own integrated movie rental marketplace, the chances of adding a competing product on the XBOX 360 are slim.

The folks over at HackingNetflix have a purported screenshot of the main menu from LG, although no screens of the video selection or settings menus. Expect more details next week at CES.

In the face of the juggernaut that is Netflix, lagging movie rental giant Blockbuster has tried many an incentive to convince viewers that it's no dinosaur. Since entering the online DVD rental business in 2004, Blockbuster has instituted "Total Access," a system of online-and-offline rentals geared toward Netflix users who may be disgruntled by the fact that they can't just hop in their cars and pick out movies on the fly.

This week, Blockbuster is taking a sharper jab at Netflix. With the President's Day long weekend underway, the rental company is attempting to capitalize on the fact that when there's a holiday, post offices are closed and Netflix shipping times are inevitably slowed down. So, Blockbuster is extending a "Presidents' Day Pardon" to Netflix members: Turn in the tear-off flap from a Netflix rental (you know, the one with your mailing address on it), take it to a Blockbuster store, and you get a free rental. Apparently, you can get an additional free rental for every address flap you turn in.

The catch: You'll need to sign up for a Blockbuster store membership. It's free, but it's still a membership, and plenty of people think those are just a tad icky. But if it doesn't bother you, you have through Feb. 21st to take advantage of this offer.

Just remember, late fees do apply.