The movie business is about to change: Apple Computer Inc. and Amazon.com Inc. are in the final stages of building online services that allow easy, legal access to potentially thousands of movies on demand.
Apple, which invigorated online music with its iTunes store, is expected to reveal plans next week to offer downloadable movies from Walt Disney Co. Amazon has agreements with at least three of the other major studios to offer movies at its online store, expected to be announced as early as Thursday.
Apple and Amazon declined comment Tuesday. Their plans, however, were confirmed by several people familiar with them. Details such as pricing and title lineups were unclear Tuesday, as was information about how the rival services will work.
But the entry of Apple and Amazon is particularly significant because they are adept at making the masses comfortable with large-scale technological shifts. Apple popularized legal music downloads and Amazon did the same for online shopping by making the process easy, fast and reliable, even for technophobes.
Analysts said the new services will almost certainly accelerate the race toward digital distribution, a transformation that is at once threatening and tantalizing to Hollywood.
Online revenue makes up a tiny -- but growing -- fraction of box-office receipts. The Internet threatens to undermine the industry's established economics, which rely on big opening weekends, then robust DVD sales and lucrative broadcast deals. Yet traditional media companies have little choice but to follow as audiences move online and demand greater control over when and where they are entertained.
"We're basically on the cusp of a mobile on-demand video market," said Aram Sinnreich, managing partner with the Radar Research entertainment consultancy.
Reinforcing that view, two other companies revealed video-on-demand offerings Tuesday.
Digital recording pioneer TiVo Inc. said its 4.4 million subscribers will be able to watch the new CBS comedy "The Class" a week before the show debuts on TV. TiVo's set-top boxes already connect over phone lines or the Internet to the company's computers to get programming information. They also have hard drives to store recorded shows. The deal hints at TiVo's long-term aspiration to deliver customized programming on demand.
