It appears that Netflix will remain the big bad wolf in the realm of digital rentals for the time being. According to Analyst Brian Marshall with Gleacher & Company, Apple's iTunes rental service has barely made a dent in Netflix and the growing market that the online rental juggernaut continues to cultivate.
On Wednesday, Marshall proposed that Apple's iTunes rental service is roughly one-tenth the size of Netflix. Although Apple's offering (2005) is much newer than that of Netflix (1999), Apple sells fewer than 500,000 rentals daily via iTunes. Netflix, on the other hand, sees better than five million daily rentals. Apple's numbers may improve, however, given the rapid growth of Apple TV, which has now sold in excess of one-million units.
Marshall estimates that 90 percent of iTunes TV viewings are rentals at an average selling price of 99 cents and that 75 percent of movie viewings are rentals at an average price of $2.99. Using those figures, the analyst gets a current quarterly rental revenue figure of more than $60 million.