Apple’s P2P iTunes Store movie downloads to eclipse Wal-Mart and BitTorrent

“Today’s New York Times combines two interesting news stories about movie downloads into one. First, it describes Wal-Mart’s (WMT) plans to provide digital movie downloads for an add-on fee to DVD sales, beginning first with Superman Returns this week. Then, it contrasts this effort with the news that BitTorrent is striking deals with studios to offer their movies using its peer-to-peer (P2P for short) technology. The article gives the impression that one of those two deals should really get movie downloads going,” Carl Howe or Blackfriars’ Communications writes for SeekingAlpha. “My view: both efforts are not going to get significant traction. They both have fatal flaws.”

Howe explains why he thinks that “Wal-Mart’s plan is just a silly offer, and my prediction is that it will suffer a quick and well-deserved death due to lack of consumer interest” and says. “The BitTorrent deal is similarly flawed, but for a more traditional reason: they haven’t thought out the user experience properly.”

Howe writes, “There’s a really nice package that does all this: it’s called iTunes. I predict it will simply grow encrypted peer-to-peer downloading capabilities. This fits perfectly into what we already know about Apple’s media plans. Apple is already rumored to be building a peer-to-peer protocol into Leopard. We also know Apple is very interested in moving around very large high-definition files to use with its iTV box. And it fits the criteria defined above nicely because:”

1. iTunes already has 200 million users
2. iTunes has proven its usability
3. Apple dominates music and video players
4. Financial accountability is already in place

Howe writes, “If Apple integrates peer-to-peer sharing into iTunes AND provides studios a revenue stream for the sharing of movies, it has the potential to dominate the digital movie business in the same way it has dominated digital music.”

Full article here.

[Thanks to MacDailyNews Reader “Macaday!” for the heads up.]

Related articles:
Wal-Mart video downloads are Windows-only, iPod-incompatible – November 28, 2006


  1. wow…P2P built in…doesn’t the download speed get faster with the more active users who have also downloaded?….combine that with the volume of iTunes users and “click…boom…amazing” (-S.J.)

  2. if only. THis would be amazing. I think Bob Cringly talked about this a few years ago… I can’t remember the specifics, but I know that he floated this idea of leveraging an install base to facilitate P2P downloading. I think the technical challenges are robust, though.

  3. P2P on an organised, large and official scale would be very cool. BitTorrent works great if you have the numbers of people or fast enough people to connect to but just as often you can find that people aren’t connected. You often also have to really tailor your settings to fit your environment, ISP etc. If it was on a legitimate basis controlled by Apple (or whoever) then it could be very cool for everyone.

  4. Yes, and iTunes-user are going to get credits up to a certain limit if they accept to share their downloads to others via P2P.

    In this way people will benefit from sharing legally, people will be able to download much faster (iTunes is already fast today, but in many places in the world peoples bandwith is not used 100%) while Apple will probably get a little less bandwith costs.

    What a great 2007 to look forward to.

  5. The studios know all this, but that more than anything they need a competitive alternative to iTunes. That’s why they’re frantically searching for alternatives on terms that are more favourable to the themselves. If Wal-mart, XBox, BitTorrent gain traction, then they can approach Apple with a take-it-or-leave it scenario. iTunes has castrated the music industry’s power, much like MTV did a decade ago. They won’t want that in Hollywood. You need competition to play hard ball.

  6. Castrate Wal-Mart! Once done, then it will be a lot easier.

    I say the film industry is waiting until after Christmas to make sure Wal-mart sells all the physical media it can.

    Then afterwards strike up a movie deal with Apple and let it grow all year round until the following season when Wal-mart will be done.

  7. I see that, with the fall of, the torrent sites are trying to grab some legitimacy before the RIAA’s target reticle gets focused in. Bit Torrent was built on piracy, and you can get just about any movie now for free. It will be interesting to see if the industry forgives this in their haste to bring Jobs to halter.

    Question to the techies: could a corporate P2P network be created that would be resistant to malice and spyware? Would it be faster than direct download?

  8. One major problem with the P2P model.

    Other users have to have the file on their drives. If I want “Pirates of the Caribbean”, that is fine since I know LOTS of other people will also have it and it should download fairly rapidly. But what happens if I want to buy, oh say… “Tom’s Day Watching Paint Dry” in Hi-Def no less. I would bet I am going to have to wait for that download!

  9. isnt a property of P2P that there are bits you are downloading and bits you are uploading?

    how can these bits be attached to one user for licencing?
    Are we saying that iTunes would stamp the DRM on the completed file download?
    What if I dont want to upload?

    This is sketchy at best, at least till Apple figures it out.

  10. I agree with “Mr. Mad Money”, Apple is the stock of the century! There are so many different ways Apple can go to leverage their strengths.

    P2P for big ass files makes perfect sense. Plus the social, err, “viral” nature of the method is a plus to adding market share.

    On a side note: I’m in Frisco on business and yesterday stopped by the Union Square Apple store. To my surprise and immediate dismay, almost all of the computers on the first floor were being used by teenagers (and one creepy looking guy) to access My Space. The store’s bandwidth was moving like molasses. Why would Apple put up with this? The market share?

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