Apple Brings 640x480 iTunes Video to Your Living Room - but not to Your iPodby John NeelyPublished on Sep 12, 2006 1:00 PM 
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Today at an event in San Francisco, Steve Jobs made a series of announcements, including Video iPod, iPod nano, and iPod Shuffle enhancements – but there was no word of either a “true video” iPod or iPod phone. While Mac groupies continue to wait with baited breath for news of an iPod that can handle TV quality video, Jobs did announce that the iTunes Store will now offer video downloads at 640x480, or “near DVD quality”.
Among the improvements, high quality video downloads have been integrated into iTunes 7 and the new iTunes Store, both of which launch today. The title of today's event, “It’s Showtime,” refers to the new availability of full-length films from the iTunes Store with the 640x480 resolution - a step in the direction towards a true video iPod. The new iTunes movie service opens its doors with 75 Disney and Pixar titles, priced at $12.99 for pre-orders and during the first week of release, and $14.99 thereafter. What Job’s called older “library titles” will be available for $9.99. In an indication of the growing importance of video in Apple’s media distribution strategy, the word ‘Music’ has been dropped from the name ‘iTunes Store.’
The other major announcement, saved for the end of the event, was a “sneak peek” at a product that won’t be available until the first quarter of 2007, dubbed iTV. The iTV unit, resembling a Mac Mini, serves as a PC-TV interface box allowing integration of iTunes video content with a TV monitor and home entertainment system. The new device will feature wireless networking for data transfer from PC to the iTV box, which is also equipped with USB 2.0, Ethernet, HDMI, component video, analog video, and optical audio ports. The iTV unit is the first device designed to move internet video content directly from PC to TV screen, bypassing the traditional video pipes completely. As such, iTV will pose a new challenge to cable television providers, who have been augmenting their digital cable services with offerings like VOIP in a bid to stay competitive with internet services. Ironically, this sets the stage for a scenario where a user could subscribe to Comcast’s cable internet service, download video content from the iTunes Store, and bypass the company’s cable TV offerings altogether.
With Jobs’ other announcements, today’s “Its Showtime” event served as a sort of state of the union address for the burgeoning internet video industry, with Apple as its defacto superpower, and Jobs as its spinmeister-in-chief. The implications of Jobs’s announcements for the consumer and prosumer camcorder industry remain uncertain, though the introduction of 640x480 video support represents another stage in the continuing development of internet-style video distribution. TV shows like Lost and Desperate Housewives have been for sale on iTunes since October of 2005, but the service is also used as a distribution tool by independent producers who master the art of H.264 compression (the native iPod video algorithm) and RSS tagging. With the introduction of higher-resolution video and the promised arrival of iTV by early 2007, Apple has also created the potential for a newly streamlined non-commercial distribution channel.
iTV and 640x480 iTunes Store video downloads offer tantalizing glimpses of the overall direction of internet video, but even the market’s near-term evolution is difficult to predict. Companies like Yahoo, Google, and YouTube provide video sharing services and are actively developing new modes of revenue generation for streaming internet video. Downloadable video opens up the potential for advertising that combines interactivity with full screen video in ways that are highly targeted. And though it wasn’t announced today, there is no doubt that sooner rather than later, a true video iPod will put “near DVD quality” video in your pocket, not just your living room.