Due to the recent Apple and Fox deal, the iPod will pose a threat to Netflix’s latest casualty, Blockbuster, and will keep Netflix alive due to Apple’s limited selection and inability to keep price’s low. However, it won’t kill Blockbuster since, well, Netflix already did that.

Valleywag blogger Brian Caulfield is calling the iPod the "quiet killer", but he fails to address some huge factors in stating that the iPod will kill Blockbuster (and other physical video rental stores).

The reasoning behind Caulfield’s statement is that iTunes will now provide us with all the movies we need and want, so there’s no reason to buy from anywhere else. What’s even worse is the statement assumes many of us use our iPods to watch video often enough to actually buy stuff off iTunes (bittorrent, anyone?).

Actually, there are lots of reasons to buy/rent from somewhere else. What if iTunes prices are too high? Netflix can easily deliver about 25-30 Blu-ray or DVD discs per month (about $0.50 per disc).

Furthermore, Netflix’s selection is huge, ranging from everything popular to the most obscure, foreign films you’ll ever watch. If we want to watch Cavite, it’s unlikely to be on iTunes. Starting very recently, Netflix also offers its current customers unlimited video-on-demand viewing through its Watch Now service. Although the service is only Windows only for now, it’s expected to eventually hit Macs as well. If anything, Apple will keep Netflix alive just because it makes it look better by comparison

As for the iPod killing Blockbuster, that won’t happen. Netflix is already forcing Blockbuster to raise prices well beyond Netflix’s own, and mutlitudes of users are switching to Netflix because it’s cheaper. Blockbuster is on its death bed like CompUSA at the start of 2007. Saying that Apple’s new video rental service will kill Blockbuster is like saying the latest mom-n-pop electronic rertail web store killed CompUSA.

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Entry was posted on Saturday, December 29th, 2007 at 9:36 pm under Internet, Media players, Online video.

Read more entries by Danny Mendez.
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