I can still rent DVDs down the street for $1, and new releases for $1.50. These figures represent a per day, 24 hour rental. And the video store is making money. Plus I can copy/rip & burn those DVDs if I want to; I cannot with Apple's DRM rentals.
I don't see the justification for the huge markup when Apple has no building, no rent, no customer service clerk, no packaging, no shelves to stock, no shoplifting risks, no direct mail advertising, and yet a limited selection.
The video store buys each video once and then rents it as many times as it can before the DVD is physically un-rentable. Apple and other online-rental services have to pay the studios a fee for
each rental. And let's be realistic about overhead: Apple has buildings, data centers, bandwidth costs, technical staff, customer-service staff, PR/ad expenses, etc., etc. Just because you don't walk into a physical store and walk out with a physical product doesn't mean there aren't costs. I wouldn't be surprised if Apple's costs per rental are actually higher than that of a typical mom-and-pop video store.
(If your local video store is inexpensive and convenient enough that you prefer to use it, great. I'm not saying I wouldn't like to pay less for each rental through iTunes. I'm just saying that it's short-sighted to say that Apple has no justification to charge what it does based on your local video store.)
As for copying the movies you rent, do you really think that an inability to steal -- sorry, "copy" -- the movies you rent is a legitimate criticism of any video-rental service?
Dan Frakes | Senior Editor, Macworld