A report in the Financial Times says that the big Hollywood movie studios are in negotiations with Apple (AAPL) to offer an online film rental service to compete with cable and satellite providers.
This would be a great win for both sides, as the deal with Disney (DIS) has proven to be extremely lucrative for both participants, although a lot of that is related to download-to-own. Still, if the other studios can do a portion of that business, they'll have a significant source of new revenue. The good thing about it is it won't compete with DVD sales, as most people get them for the add-on special effects and interview sections.
It looks like the cost of the rental will be $2.99 for 30 days. While it will include digital rights management, renters will be allowed to transfer the video to one other device. Movies won't be able to be copied.
For Apple, this would give them a large catalog of professional film content, if the talks are successful. The service is scheduled for release sometime in the fall.
Apple, in addition to Disney, also has a distribution deal in place with Paramount (VIA-B).
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