Apple Launches Online Movie Rental Service

Earlier this week, Netflix announced that its subscribers now have a free online streaming service. Today, Apple confirmed rumors of a new online movie rental service available online through iTunes along with an upgraded Apple TV device.

Speaking to a packed crowd at this year's Macworld Expo in San Francisco, Apple Chief Steve Jobs announced the service. It launches today on iTunes and should have more than 1,000 films by the end of February, he said. Users can expect to rent the films 30 days after the DVD is released.

Movies will be priced at $3.99 for new releases and $2.99 for 'library' titles, with the price in both cases going up by $1 if the films are ordered in better-than-DVD high definition quality. Users get 30 days to watch it on their computers, iPods or iPhones. Once users starts watching, however, they have 24 hours to see the whole film.

"With the new Apple TV and iTunes Movie Rentals, movie lovers can rent DVD-quality or stunning HD movies from their couch with just a click of a button," Jobs said. "No more driving to the video store or waiting for DVDs to arrive in the mail."

During his annual "Stevenote," or keynote address, Jobs also announced an upgraded version of Apple's slow-selling Apple TV device, a box that sits near the TV and connects to the Internet. With the upgraded Apple TV box, viewers will be able to order and watch movies without leaving their homes. Each movie takes 30 second to download, Jobs said.

In the US, Apple has lowered the price of the Apple TV box from $299 to $229 in an effort to promote its new features.

In related news, Netflix announced on Monday it will allow its 7 million subscribers to stream online videos for free. Previously, subscribers to its service could only use the streaming movie service based on how much they paid to rent DVDs. the unlimited online service is now open to all subscribers except for users of its cheapest package of $4.99 a month.