Check this out:
Fox Web sites to sell movies
Most people these days have what's called "broadband". I wouldn't call it that, but what do I know? Anyway, most people either have between 768 kpbs (that's kilobits per second, where 8 bits = 1 byte) and 1.5 Mbps on their dsl or cable line. So, when digital downloads of music came along, it was no problem. An average user could go on itunes and download a 5 megabyte track in between 26 and 52 seconds. For a slower site, it might take 2 to 3 times as long, but that's no big deal.
That is to say, music downloads didn't push bandwidth any higher. But what about movies and tv? A typical LOL-HDTV distribution goes from a woeful 350 MB up to an adequate 700 MB for a 42 minute episode of some tv show. Realistically, any movie download would have to be at least the size of a DVD5, or 4.7 GB. That's 30-60 minutes at full tilt (meaning that the rest of the family has to suffer) for a tv show and 7 HOURS for a movie. Will the average consumer really wait that long?
Who here remembers all the jokes that went around about "buffering..." in the old days of dial-up internet? This distribution model, at present, is pretty damn far from on-demand. At the worst, it's far too annoying for the user. Not only isn't it streamable, but one would have to plan pretty far in advance what one wanted to purchase. Couple that with crippling DRM, and I just don't see this being adopted.
Two things could alleviate this: one is that we can finally upgrade our typical user's bandwidth to that of a first world country. South Korea is currently cleaning our clocks in bandwidth, and FIOS is basically a dream. Our upload speeds are ridiculously and artificially crippled, but download speeds could be significantly improved. Upload speeds become important if the media companies wisely decide to use a bittorrent-like distribution model rather than pay for every tranferred byte themselves.
The other thing that might be done is that you could leave your computer on all the time, and it updates as long as the computer is running, say during the middle of the night. This model seems to have worked ok for Steam.
Personally, I hope this development succeeds and spurs higher bandwidth in the US. As it stands, I have the same transferring technology as I did in 1997, whereas my computing power has increased at least 100 fold in the same time span. Something just ain't right.