Webware

Starting next week, a DVD you buy off the shelf could end up coming with a free or markedly discounted digital copy from the iTunes Media Store. The Unofficial Apple Weblog got the scoop from a reader who got an early delivery of the upcoming Family Guy DVD, which comes bundled with a digital download that can be transferred to your iTunes library. When a copy of the digital file to iTunes was attempted, the user got an error message noting that the process requires version 7.6 of iTunes, which is currently at 7.5.

Like movies purchased on the iTunes Media Store, digital copies found on optical media appear to be tied down via DRM. In this case, it's the use of a serial number that gets plugged in and authorized by iTunes. The DVD in question comes from Fox, which has had a similar process in place for other DVDs, although in the past it's used the now-defunct PlaysForSure DRM, which was created by Microsoft.

Besides movie files, piggybacking other content on DVDs could be Apple's next move towards establishing the longevity of iTunes. Studios could still retain their online distribution on iTunes, while offering the consumer a chance at extra pieces of content in the future or a quick link to the movie's soundtrack on iTunes. This is also the first hint of what Apple might be unveiling at next week's Macworld Expo. While the big draw of the show may be the expected hardware upgrades, long-rumored movie rental service, and a demonstration of the official iPhone SDK, this might have just blown the surprise of the "one more thing" we're all curious about.

AllFacebook blogger Nick O'Neill wrote on Friday that an "extremely reliable anonymous source" had told him that Facebook is working on an in-house rival to Apple's mighty iTunes Store. According to O'Neill, the company is in the process of looking for an executive to head this division--his source allegedly knew about the whole deal because of an acquaintance interviewing for the position--and is already meeting with record labels.

It's unclear whether this would be strictly a music store or whether it might extend to other forms of media, like TV shows and movies.

This is very much a rumor, but it would make sense from several different standpoints: first, the fact that Apple's iTunes Store is potentially at its weakest point in months due to controversy over digital rights management as well as disputes between Apple and the entertainment industry that have led to several big players like NBC Universal pulling out of the digital-media hub altogether.

Second, it's no secret that the future of Facebook's profitability is hazy, considering how much of the site's revenue relies on an advertising contract with Microsoft that expires in 2011. Plenty of analysts and critics have said that the Mark Zuckerberg-founded company is going to need to find an innovative way to make money.

But on the flip side, starting a digital download store would be a massive operation for a company that has heretofore been strictly a social-networking service--even one that's as hot as Facebook is now. Currently, the company's only e-commerce operation is the one-dollar "virtual gift" service that it's operated since February. Additionally, the digital download market is already getting saturated with new entrants eager to take on Apple's weaknesses. The new Amazon.com MP3 store, for example, has been described as a worthy competitor.

Not to mention the fact that, as O'Neill notes, the developers and companies responsible for Facebook's myriad third-party music applications won't be too happy if the site that provided their software platform created an in-house competitor. But something tells me that won't stop Zuckerberg & Co.

Remember when Amazon.com was just a bookstore? On Tuesday morning, the online retailer launched the public beta of its much-anticipated rival to Apple's iTunes Store: Amazon MP3, which features over 2 million songs free of digital rights management copy protection, which means they'll play on any computer, music player, or music-enabled cell phone.

Because of Amazon MP3's DRM-free focus, that means the selection isn't as wide as the iTunes Store's. Several major-label conglomerates, like Sony BMG and Warner Music Group, have not jumped onto the bandwagon and hence aren't offering their music for sale in Amazon's new store. Nevertheless, the retail giant has played up the fact that there are still 180,000 artists represented from 20,000 major and independent labels, including several prominent indie labels that are offering their music for the first time in "naked" format.

Each song is encoded at 256kbps, the file quality that Apple offers for its DRM-free iTunes Plus premium music selections, which it sells for $1.29 apiece rather than its usual 99 cents. Amazon's pricing for Amazon MP3 ranges from 89 cents (including the top 100 best-selling songs) to 99 cents; albums are priced from $5.99 to $9.99.

It goes without saying that Amazon is aiming squarely at Apple, and it's attempting to hit the digital music monopoly where it hurts--with regard to pricing, file quality, and versatility, all of which have come under scrutiny by critics. But this could also be a painful blow for eMusic, the online music store that has made a small name for itself by selling exclusively DRM-free music.

While the iTunes Store started its digital download empire with music sales, Amazon has already operated a movie download store, Amazon Unbox, for a year now. Unbox was off to a rough start at first, but tweaked features, partnerships with companies like TiVo, and a solid selection have improved the company's reputation for media downloads.

Wal-Mart is joining the fray of movie download services today. Its new store (which is mysteriously unfriendly to Firefox) features movies from all six major studios including Disney and Sony--two studios that have a long history of proprietary use and ties to competing download services.

(Credit: CNET Networks)

Films range from about $13 to $20 and can be watched almost immediately depending on your connection. Movies are managed and played through a custom player that runs only on Windows PCs. You also can watch the movies in Windows Media Player. Like the iTunes Movie Store, titles released on DVD will be available digitally the day they're out.

The files reside on your hard drive and can be backed up and transferred to a portable device. Each file weighs in around 500MB to 1GB. Downloaded movies will play on Creative's players and several Archos models, but not your iPod or (no surprise) Microsoft's Zune.

This new service doesn't get me that excited. I'd like to see the prices on digital downloads come down substantially. I'm not sure who is going to pay $13 to $20 for a DRM'd download that has no special features and can't be downloaded again upon accidental deletion. There are a lot of competitors in this field, and I think the lack of compatibility with iPods and PSPs makes choosing a digital download over an actual DVD tough.