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A little less than a month ago, Microsoft announced that they would be the first to bring high definition downloads to the masses – beating to market other stalwart media and technology companies such as Netflix, Apple, TiVo, and Comcast. Last Wednesday, they succeeded at this goal.

While Apple is offering on demand videos through its iTunes client, there are two mission critical pieces of functionality that their strategy is lacking. One, while iTunes is clearly one of the most popular software clients in the world, a very small percentage of Apple’s user base will be able to use it in their living room. Two, and this is puzzling, but Apple is not offering high definition downloads of its video content – only near DVD quality. This likely originates from a business reason and not a technology one as clearly Apple has the infrastructure to begin doing this at anytime.  

Netflix, of which I have been a loyal member for quite a few years, has embarked on a very conservative HD strategy by offering titles in both HD-DVD and Blu-ray formats. They seem content with this business model that’s worked for them in the past for now and show no signs of offering any video on-demand services anytime soon. On the one hand, this approach is likely to keep me as a member. After all, it will be years before either HD format can replace the sizeable library amassed by the DVD. In fact, I suspect many obscure titles will not be replaced at all. Yet, it’s also a bit disappointing that Netflix isn’t experimenting in the on-demand area at all.

In many ways, Netflix is the most sophisticated of all these companies. Of all the social networks I’ve joined to date, I find that Netflix has created the most user-friendly and original.

TiVo was one of the most radical software and hardware technologies to originate in the past decade. Soon after I bought one for myself, I had convinced three other people to purchase one with a basic demonstration of the functionality. TiVo was viral and addictive. Unfortunately, after I jumped to HD about a year ago, my TiVo was not compatible and has been sitting in storage ever since. It was back to commercials until TiVo would release an HD compatible model. Unfortunately, the perpetually delayed TiVo Series3 is insanely overpriced at $799 which does not even include the cost of a monthly plan! Many industry pundits wrote off the company years ago suggesting that the cable and satellite companies would copy their features and give away their technology for free. Part of me never believed that would happen – at least not overnight. When a company nails a product like TiVo did, it’s incredibly difficult to mimic its success – even by much larger competitors. It’s clear that this has not been in the case – Comcast offers a movie record feature, but I’ve heard nothing but bad things about it. On top of that, their interface comes nowhere close to that of TiVo’s friendly, intuitive interface. Perhaps the company paid too much attention to its critics resulting in the Vista-length development cycle of the Series3 model. If only the business people at TiVo could have secured licenses to companies like Comcast and even Apple, they could have become the standard for time-shifted content. Alas, no such luck. Now even I even wonder if TiVo stands a chance – not against the cable and satellite operators – but against the software companies like Microsoft and Apple.

The point of this entry was to highlight my recent experiences related to downloading my first HD content using the Xbox 360 Marketplace. This occurred last Wednesday, the day it was unveiled.

Let’s start with the bad news first. As reported on several other sites, including Engadget, it’s clear that the first couple of days revealed some major issues with the service. While attempting to download my first piece of HD content, Poseidon (more on why I choice this ridiculous blockbuster later), the download process started as one might expect. However, HD movie files are gi-normous, weighing in at over 4 gigabytes. This means that upon initiating the download process, the percent complete indicator remains at 0% for quite some time. In fact, you begin to wonder if the content is really being downloaded. After some time, the percentage jumped to 1% and I was relieved. Assuming that everything was OK, I left to let it do its thing. Of course, coming back thirty minutes or so later, it appeared as if the download stopped since it was no longer appearing in the active downloads screen. For anyone that has youthful memories of getting the occasional quarter eaten in an arcade, you’ll know my first reaction – did I just get cheated? In this case, did I get cheated by a multi-billion dollar software company? Fortunately, after going back into the Xbox Market Place, it was clear that the server knew I was entitled to re-download the movie. Good news, but later the download process would mysteriously error out again. My theory was that something was causing the download process to slow down until ultimately it would die out completely. Of course, nowhere in the process is the end user provided with a 1-800 number to contact their support team. Troubleshooting though is very difficult because there is no way to convert the download activity feedback from a percentage complete view to one that simply shows the current download speed which would make it easier to pick-up on a pattern.

After a few more experiments, it was clear that the Market Place was not responding consistently and all was not right with Microsoft’s servers. I imagined a team of program managers at Microsoft sweating profusely as the real-time bandwidth meters were getting progressively more and more taxed.

After some more experimenting, I came to discover that the issue was both on Microsoft’s side and also my own. By modifying the wireless channel on my Linksys router to something other than the default (in this case channel #1), the quality of reception seemed to improve. Or, should I say, the consistency of reception.

One other bit of bad news is that I was surprised to discover that a vast majority of the content is not HD yet. Although V for Vendetta is offered in HD, The Matrix is offered at basic DVD resolution. How can Microsoft not offer The Matrix in HD for launch? If you’re wondering why I downloaded Poseidon, it was only one of about six titles that was in HD that I hadn’t yet seen. Microsoft over-marketed the amount of HD content they’re offering. I have faith this will get better with time, but I was not able to find an easy way to filter on HD content. The only way to determine whether something is HD is to drill down to the detail view of the content item.

Another bit of bad news is that the distribution model is pretty unwieldy. Once you purchase a piece of content, you have 14 days to download it. Once you hit the play button, you have 24 hours to watch it as many times as you like. Given the prices, this seems a bit high. Also, I felt burned because after the problems I ran into. After the download completed, I almost didn’t believe that the video would actually play given all the previous issues. I went to verify that it actually worked – forgetting about the 24 hour rule – and realized immediately that was a big mistake because I was preparing to leave on a trip an hour later.

The good news is that the video and audio quality is outstanding. Poseidon may be a terrible movie, but visually, it’s gorgeous in high definition. Also, I like being able to easily filter on new arrivals and top downloads. I’d like to see more social networking tie-ins. For example, I’d like to see what movies my friends have downloaded or recommended similar to Netflix. I’d also like to be able to setup a queue and have a subscription model similar to Netflix.

It’s unlikely that I’ll spend an enormous amount of money on downloading movies this way. However, it’s clear to me that this is the future and we’re not far away from being able to download just about any motion picture that’s converted to a digital format. I still very much enjoy getting Netflix titles in the mail and knowing that the next item in my queue will automatically be sent.

Microsoft’s strategy is two-pronged though and they’re not limited themselves just to HD on-demand. The Xbox 360 HD-DVD drive is now available as a very reasonable $200 upgrade. This means that my Netflix isn’t likely to be canceled anytime soon!