Could iTunes Movie Rentals Save Apple TV?

After months of rumors, it's starting to sound like movie rentals are finally coming to Apple iTunes—a move that could, if done correctly, revive the flagging fortunes of Apple TV.

The drumbeat surrounding iTunes movie rentals has become impossible to ignore in the past week or so, with Variety recently reporting that both Fox and Disney are on board. Talks are supposedly underway with Paramount, Lionsgate, and MGM (which already sell movies over iTunes); meanwhile, Variety seems to believe that Sony, Universal, and Warner Brothers are "unlikely" to sign on "for various competitive reasons." Everyone's expecting Steve Jobs to announce the deal at his Macworld keynote later this month.

If the iTunes movie rental scheme does indeed go down, it could be great news for Apple TV, the much-maligned set-top box that many—including myself—had essentially left for dead after poor sales and little in the way of care and feeding from Apple itself (there hasn't been a software update in more than six months). Now, a greater selection of movies and rental pricing would be a much-needed shot in the arm for Apple TV—provided that three important things happen:

1. Movie browsing and rentals over Apple TV itself: I've been complaining for months that you can't browse for and purchase movies and TV shows over the Apple TV interface; instead, you must buy videos on your Mac or PC, then sync them with the Apple TV box. As part of the deal, Sir Steve ought to announce that you can now browse the entire iTunes catalog—including videos and music—over Apple TV, as well as purchase media over the device itself. After all, we can buy tunes on our iPhone and iPod Touch, so why not over Apple TV?

2. Decent rental terms: Variety is reporting that movie rentals would cost between $2 and $5, with a 24-hour window for watching your movie. I'm not wild about the 24-hour window, but I could live with it—provided that the window doesn't start until the moment we hit Play, and that we can watch our movies as many times as we want within that window.

3. HD downloads: The Xbox Video Marketplace has offered HD rental movies for more than a year now, and Apple TV is capable of delivering HD video, so why not have some HD movies available for rent on iTunes? And if Apple allows for rentals over Apple TV, big HD movie files could download in the background or overnight.

Anyway, that's what I'll be looking for come the Jan. 14 keynote. What about you: Would give Apple TV a second look if iTunes movie rentals become a reality?

Fox, Apple to sign iTunes deal [Variety]