HD content and DRM
There are several issues I see with this:
1) HD is huge, even compressed like mad in h.264. Notice that Jobs said a movie would take 30mins over a 5Mbit connection and that assumes saturation of the line. Not always possible. I think even at the current ratios, the avg time will be an hour, but it would take 6 times the time to d/l HD (assuming 1080p). I will be doing some tests once the new box comes to get a feel for file size and avg download time.
2) Content providers do NOT want to steal the thunder about upcoming Blu-Ray and HD-DVD releases. There is a whole electronics industry and new range of content options based on this hardware/media set of alternatives. Apple could release titles in 1080p (which would require the component video outs since 1080p is NOT supported over HDMI...perhaps HDMI 2?). I mean, if Apple starts a HD d/l service and is available via iTV then it becomes hard to justify getting users to buy Blu-Ray or HD-DVD anything. Granted, keeping a library of HD content would require significant storage requirements, the costs of HDs may make it where instead of having DVDs, Blu-Ray and HD-DVD discs, it would be replaced by various external LaCie drives waiting to be connected via Firewire 800. Plus, up to the bandwidth limits of the Airport you have, you could potentially stream several movies at a time to various Macs/PCs with the only requirement being 802.11 receivability. I just see that as cutting off the adoption of the physical media at the knees and unless there's some wicked tough encryption available for HD downloads, I think we will see the emphasis placed on HD physical media until at least DVDs are viewed as legacy technology.
3) If (when) the DRM for the video is cracked, the pirates will have sufficient data to make pure Blu-Ray, HD-DVD versions and even higher bitrate DVD versions (closer to the 7Mbs max) than most studios make for most movies. Digital content protection will be a tough nut to crack and I personally agree with Jobs that modest pricing is the best way to ensure the least amount of piracy.
I think we are limited to 480p downloads for the forseeable future.
That said, I plan to have a Blu-Ray writer sometime in 2007 and when my Blu-Ray netflix movies come, I'l rip them, stream them and then dump them (I pay for my movies, so I don't use Netflix to make a pirate library. Not holier-than-thou, I just know a lot of people in the movie biz behind the camera who feel the pain of piracy). I don't want to pay for a separate Blu-Ray and HD-DVD player and all that. Who knows, if iTunes starts to see Blu-Ray, DVD and HD-DVD discs, then perhaps I'll be able to stream straight from the disc and won't have to rip anything...