No Future for Paid Video Downloads?

According to a well-known market research firm, Forrester, the future of online video shops, such as MovieLink, CinemaNow and Apple iTS, with their paid video downloads is not going to be as successful as companies expect it. According to Forrester, it will remain a niche market for media junkies, as consumers might not be willing to pay for acquiring the digital version of a movie or a TV show whereas they can watch it on TV, record it or simply go to cinema. Forrester expects to see the online movie shops moving from pay-per-view model to ad-supported streams supported by Television and cable networks; while movie studio will push for a subscription model.
While one should always be careful with analysts and their expectations, especially when it is related to Apple, we should also mention that Forrester did not work too hard to reach such conclusions as it reflects the current situation in Europe. In many EU countries, internet providers offers a set-top box managing high-speed internet connection, as well as VoIP and TV, providing access to dozen of channels and programs. They have already implemented a video-on-demand service with a relatively mild success. The success of ISP set-top boxes in Europe might explain the poor sale rate of recently released Apple TV on this side of the Atlantic.