I Propose Online Movie Rentals 2.0

I'll start with the solution and then explain how it addresses all concerns. 

The Scope of this Solution

This is aimed at a company like Netflix, DirecTV, Dish Networks, Comcast or any other content licensee.  I stated that this was a feasible business solution, not an ideal consumer solution.  You may think I'm too pro-business but what I'm suggesting has more value to the consumer than receiving DVDs in the mail and is something that the MPAA would potentially sign off on, which is the key to delivery.  This is a proposal for a video rental replacement, not for an all-in-wonder media-whiz.  Think of my proposal as a compromise which gives the consumer better rental options than currently available.

The Business Model

Customers rent a number of movies at-a-time.  The videos are available to watch on their TV at home.  Only the number of videos they selected at-a-time are available until they remove one, at which point the next in queue would begin transferring.  This is parallel to the way Netflix handles DVD rental by mail, except everything happens electronically.  The big value for the customer is doing away with shipping time.  New movies are instant, or only with a slight delay for high quality HD content.  The rental company can charge a flat monthly rate and can rent any movie in its collection out because the customer is unable to copy or preserve it.  They may rent it as many times as they wish but it must always be within the set movies-at-a-time limit.

The hardware required is to be free as part of the subscription.  View it as a necessary component in the chain.  Without it, the business does not work.

Hardware

It starts with a set top box.  This is not new concept for most vendors of course but the box would be special in a few ways.  As far as hardware goes, it would have a hard drive with no less than 200GB capacity, a wireless connection no worse than Wireless-G,  a wired connection no worse than 100 megabit, an HDMI output and a security card interface.
Seems rather limited.  You may be inclined to ask me:  Why not better specs?  Why only HDMI out?  Why a security card?! 

The specifications don't need to be better than that.  The fastest broadband connection available in the US right now is 15 megabit from Speakeasy.  The max number of films one could have would be 8 at a time which in H.264 encoded 1080x1920 @24fps would take up 192GB of hard disk space according to figures here.  That's the absolute maximum quality and resolution for the HDTV specification and that video encoding. 

HDMI-only output is to circumvent copying by utilizing HDCP.  Fair-use does not apply because the video was not purchased, it was rented.  If you would like to buy the film you are allowed to make copies for personal use according to US law, but that is not the case here.  The point is to alleviate MPAA fears of users copying films and spreading them around.  This ensures that the video is only viewed by an HDCP compliant device, which should be good enough for their online blessing.

The security card is to prevent users from hacking the software on the set top box.  Using a similar approach to Hughes/DirecTV, one could implement a card that has a private key embedded into its code.  The card is not crackable.  If you don't believe me, please research NDS P4, P5, etc.. security cards.  They are very reliable.  The card could be used for a critical function such as decoding a stream, booting the OS by checking a hash of critical files, etc or other things.  This ensures the box is not hacked and is operating as expected.

Software

The software on the set top box would provide a listing of movies along with the current films downloaded.  One would expect an intuitive, easy-to-use interface which gets straight to the point of watching films.  There is much room here to add extra features but all the consumer really wants is to watch the movies available from the rental service.  Anything else is gravy.

End-User Experience

At the end of a long day at the office, the customer gets to plop down on the couch, turn on the TV and see what movies are available to watch right now.  Got a craving for something else?  Use the "watch now" function to remove an already-viewed film from the local queue and start downloading the new movie while watching it.  Movies should be able to stream in real time but if the user wants higher quality than he/she has bandwidth for (such as Full HD), the movie can download in the background while he/she watches something else.  Remote administration capabilities right through the user's online account make a fantastic addition, allowing the user to pick some what they want to watch when they get home in the evening and have it ready to go when they get there.

Closing Statements

I believe this technology will happen in this form or a form very close to it.  It makes sense to the customer, to the publisher and to the company in the middle, the movie rental service.  While many incarnations of set top box and streaming video service exist and will continue to exist and evolve, this approach makes sense purely from a rental business standpoint.  If Netflix doesn't do it, someone else will.  I see this as the rental system of the future.

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