Apple said to be working on a movie rental service

Apple became the first major digital media store to offer movies on download. The company is now said to be working on plans to launch a movie rental service which could challenge the domination of cable and satellite TV operators.

Apple is of course already selling movies which can be purchased and downloaded. They have content made available from movie studios including Disney and Paramount.

Several movie studios have stayed away from this service for the fear of digital piracy. But a movie rental service that works on the basis of Video on Demand is likely to lure in more partners.

Also, the movies which are downloaded for rent are unlikely to hit the sales of DVDs for these companies.

All these factors makes it quite attractive for Apple to get into this market.

Sources say that the company could launch this service as early as autumn this year and a rented movie is likely to cost $2.99 for a 30-day period. With Apple TV out now, the service could become a major hit in the US market.

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