Apple is set to unveil at MacWorld San Francisco a groundbreaking deal with News Corp.’s Fox movie studio to rent movies through Apple’s iTunes store, news reports revealed Thursday. whether true, the news could impact the landscape for on-demand movie rentals dramatically.

The announcement will include not only Fox but additionally at least one other major studio, the New York Times reported. The new service would mark a reversal both by Apple CEO Steve Jobs and by the Hollywood studios.

“Fox and potentially other studios are coming around to the concept that there is nobody out there to challenge iTunes,” Jonathan Weitz, a principal with IBB Consulting, told the Financial Times. “This deal is a sign that media mobility is coming to the mainstream.”

Thus far, Apple has folded to get Hollywood on board with using iTunes to sell movies. Only Disney, which owns Apple CEO Steve Jobs’ Pixar, offers new releases for sale on iTunes.

FairPlay

License Part of the Deal

The deal with Fox reportedly includes an agreement to license Apple’s FairPlay digital rights management software, marking a reversal for Apple, which has resisted licensing the software. According to the Financial Times, future Fox DVD releases will include a FairPlay file that will allow composition to be copied from DVD to computer for loading onto iPods.

Other online rental programs have losed out to gain much traction thus far. Wal-Mart announced Thursday that it is discontinuing its digital download online store. A streaming online offering by Netflix suffers from a lack of recent releases and the need for a fast World Wide Web connection. Movielink, an online service created by the movie studios, was sold off to Blockbuster in a fire sale. And Amazon’s recently released service, Unbox, has yet to catch on with consumers.

Apple has what all those other services lack: the iPod and…

Orginal post by Top Tech News