So it is nice to see VUDU giving users the option to wait a little longer and get higher quality content instead of being limited to fast but comparatively poor quality playback. However, they don’t say just what the quality level is. They talk resolution, but, as I’ve said, resolution is just part of the puzzle. All 1080p24 content is, by definition, the same resolution. But if one is 40Mbps and the other is 4Mbps, all else being equal (same codec, etc), one is going to be much higher in quality. I really would like to know what the HDX bitrate is. Conventional non-HDX HD content from VUDU requires 4Mbps, I’m presuming HDX is higher, but how much?

Some press is calling it Blu-ray quality, but that’s bunk. Even without knowing the bitrate being used I’m positive it doesn’t match Blu-ray, and I’m just as positive it doesn’t use lossless audio like Dolby TrueHD or DTS HD-MA. The website says:

HDX technology delivers the best available surround sound quality for Internet delivered movies with immersive, high resolution sound at a 40% higher bit-rate than standard surround sound DVD’s.

‘Standard surround sound DVDs’ use Dolbly Digital at 448Kbps, sounds like they’re using Dolby Digital at 640Kbps.

HDX is definitely a step in the right directly, IMHO, but don’t believe it is Blu-ray quality.

EDIT: Found this from David Pogue at The New York Times:

To see why HDX looks so good — especially on big screens — check its data rate, a measure of how much information is used to describe each frame of the video. It averages around 9 megabits a second, but spikes to 20 during action scenes. Compare that with Vudu standard definition: (2.2 megabits a second), Vudu and Apple TV high definition (4), regular DVD (8) or Blu-ray DVD (40). In other words, HDX quality is somewhere between DVD and Blu-ray. The audio offers a 40 percent improvement, too.

That is a marked improvement over their normal HD streams, but yes, still not Blu-ray quality. It does make the product more appealing in my eyes though, and certainly puts VUDU in the lead as far as HD download services go. I’m not sure if he’s comparing just video bit rates or what – DVD’s full video rate is ~10Mbps, but that’s MPEG-2 so apples and oranges to the others which are H.264. Blu-ray is 40Mbps max for video (not that it is all used normally), 54Mbps total bit rate.

HDX raises my personal interest in VUDU, though with a TiVo Series3, PlayStation3, and SlingCatcher already it isn’t high enough yet to get me to put another box under my TV.

These claims have clearly struck a sensitive nerve within the Blu-ray community, which, given their strategy as outlined above, is perhaps not surprising. Today the BDA has given me the following statement:

“A number of companies have recently launched advertising campaigns claiming their products deliver high definition picture and sound “equal” to that delivered by Blu-ray Disc. These comparisons are irresponsible and are misleading to consumers. Up conversion and satellite broadcast cannot provide a true Blu-ray high definition experience, as neither is technically capable of producing the quality delivered by Blu-ray players and Blu-ray discs. To that end, the Blu-ray Disc Association is exploring these claims further and will take appropriate action, as necessary, to prevent consumers seeking the ultimate in high-definition home entertainment from being misled.”

I’m happy to see this. Blu-ray has struggled to educate consumers about higher quality home cinema, and now that it is started to gain recognition and traction in the market other vendors are trying to ride their coattails by tricking consumers into thinking they offer the same quality experience just because they’re also ’1080p’.

Picked up from EngadgetHD.

Now they’re following up on that with a deal they’re calling ’99 for 99′. A rotating selection of 99 titles available to rent for just $.99 each. That blows away Amazon’s weekend sales, which generally only have an handful of titles for $.99, when they have any for that little. EngadgetHD has VUDU’s press release.

With video downloads it is always a compromise between speed and quality. For instant gratification you have streaming video, but that’s the lowest quality. Broadband speed limitations restrict the maximum possible streaming bitrates. Downloads can offer higher bitrates, but still require fat pipes to be feasible, and, of course, storage. But even the best download services don’t come close to matching the picture quality of Blu-ray, because they can’t match the bitrates. And don’t even get into bonus features, lossless audio (Dolby TrueHD or DTS HD-MA), multiple audio and subtitle tracks, etc. With most commercial Blu-ray titles using between 30GB or more of disc capacity, we’re not going to be downloading content at that quality in the near future.

So I was a little gratified to see this article in CE Pro, entitled Blu-ray and Downloads: Why Both Are Worth Offering. CE Pro is an industry magazine with a primary audience of consumer electronics professionals, the kind of folks who install custom systems in high end homes. The article focuses on Blu-ray for physical media and VUDU for downloads, but Amazon Unbox on TiVo, iTunes on Apple TV, Xbox 360, PlayStation3, NetFlix, etc, are all possible broadband video options for the consumer. Downloads aren’t about to replace discs for those who prefer a quality viewing experience, but downloads offer the kind of instant gratification that discs can’t match. I think having both available is the best approach, the best of both worlds.

“Not a consumer interviewed wants to buy another set-top box,” said Richard Doherty, research director for research firm The Envisioneering Group.

I certainly can’t argue with that, I’m loathe to add another STB to my stack. And I’ve said so repeatedly. I think that gives TiVo and the Xbox 360 an edge – people buy them for other functions (DVR & gaming, respectively), and the downloads are kind of a bonus. And when it comes to HD, I have to agree with this as well:

Richard Bullwinkle, chief evangelist for Macrovision, predicts a layering effect. Macrovision has looked at TiVo, Xbox 360, Vudu and Apple TV.

“The best experience on a large TV is Blu-ray,” he said. “None of the download boxes gives you the same experience.”

But I thought what they said about TiVo in particular was unfair.

But download times are long, nothing is available in high-def, and the 24-hour rental period once the movie has started can be problematic.

The download times are roughly comparable to other services – but it, of course, will vary a lot. The TiVo Series3 and TiVo HD have had progressive download since 9.2 – which means they can start playback once enough of a buffer has built up, with no need to wait until it is all downloaded. I’d expect the Series2 to get the same in the next update. (They’re still on 9.1.) And the article makes the 24-hour window sound like a problem unique to TiVo when it is common to all of the download rental services. They don’t mention it when talking about the three other products, so readers who don’t know what will think this is a TiVo limitation. But there is more:

However, Bullwinkle said, TiVo offers the worst quality of any of the movie downloading options he’s tried, and the number of TiVo owners who download movies is small.

Ouch. That especially stings given who it is coming from. Why? For those who don’t know, once upon a time Richard Bullwinkle was known online as TiVolutionary. He was one of the early TiVo employees and their primary online evangelist on forums like TiVoCommunity.com. Back in May of 2002 he left TiVo and went to work for ReplayTV. And now he’s with Macrovision.

The quality issue is largely subjective, so I’ll leave that as may be, but how does he know how many users download movies? I don’t believe TiVo or Amazon release those numbers. Did they do an independent survey of TiVo owners? Where is the data to back up the claim?

But TiVo isn’t the only one to get a little heat in the article. All four products get what I consider to be fairly poor reviews, highlighting their shortcomings. But read the article for yourself.

TiVo also got another mention in this issue, with a small article on the roll-out of TiVo Desktop 2.6. (And I apologize for not having my review of said up yet, the behind-the-scenes work on the renaming took a lot more time than I expected.)

We wanted the VUDU to deliver in such a way that HD freaks could really grab hold if those excruciatingly long wait times encountered with Netflix / Blockbuster were pushing them to find an alternative. Unfortunately, we still can’t wholeheartedly recommend the VUDU to those who appreciate high-definition. To be honest, the device still seems grossly overpriced when you consider that the aforementioned rental-by-mail options can be turned on and off on a whim, provide flicks that don’t vanish 24 hours after you hit play for the first time, and have HD libraries that far exceed that found on the VUDU. The primary selling point of this device is its ability to provide absolute instant gratification, but with HD VOD quickly expanding into more markets across the nation — not to mention the smattering of local B&M video stores surrounding most everyone — we’re still left scratching our heads trying to uncover exactly what niche this thing is aiming for.

At the end of the day, our time with the VUDU could be described as generally enjoyable. We were pleased with the interface, thrilled with the ease of use and particularly wowed by the audio quality. Still, those flashes of greatness can’t overcome the subpar HD video quality, high initial cost of ownership and unfortunate rental restrictions. Is the VUDU a unique and nifty gizmo for acquiring HD movies? Unquestionably so. Is it something that’s ready to replace your satisfactory relationship with HD VOD, Netflix / Blockbuster or HD DVD / Blu-ray? Not just yet.

VUDU is expensive for a single-purpose device, especially when video downloads are appearing as features on other devices – Amazon Unbox on TiVo, downloads on Xbox, AppleTV, etc. Sony is talking about adding downloads to the PS3. Netflix is talking about bringing streaming to more platforms, including the 360 and PS3.

And the system they use, caching a small amount of video for instant starts and relying on downloads for the rest, limits their quality. VUDU claims they can support HD downloads with a minimum of 4Mbps. But there is no way they can even come close to Blu-ray (or HD DVD) with bitrates that low. VUDU claims they’re ‘broadcast quality’, but even matching broadcast with bitrates that low would be tough. (Even given their codec advantage – broadcast is MPEG-2, VUDU is MPEG-4/H.264.) And EngadgetHD’s review reflects this.

In what I think it is nice gesture, VUDU will offer a $100 movie credit to anyone who has purchased a VUDU box in the last 30 days, provided they can supply proof of purchase. Shades of the iPhone price drop, though this credit should certainly be more useful to VUDU owners than Apple’s credit was to iPhone owners. They also restate that the VUDU XL, announced at CES, will ship by the end of February.

The press release:

VUDU CUTS ENTRY PRICE $100 TO $295

Breakthrough Instant-Access Video Entertainment Experience Drops To Mainstream Price Level

Santa Clara, CA – January 24, 2008 — VUDU Inc., the company that brings instant access to video-entertainment to the living room, today announced that it has lowered the price of the basic VUDU box to $295, a decrease of more than $100. The new price takes effect Jan. 24, 2008.

Since its launch last year, VUDU has quickly achieved critical mass among home video fans by offering instant gratification, always-on accessibility, a vast selection of current and classic video content and weekly delivery of new titles as they come to market.

“We’ve been thrilled by the enthusiastic response we’ve received from our early customers, which tells us we’re giving video fans the experience they’ve been waiting for,” said Patrick Cosson, VUDU’s VP of Marketing. “With its large catalog of Standard Definition and High Definition movies and TV shows and now a new lower price, VUDU is the perfect upgrade for any movie lover who wants great video quality plus the convenience that only digital delivery can offer.”

VUDU enables consumers to have instant access to video entertainment directly from their TV. By crafting relationships with every major Hollywood movie studio and more than 22 independent studios and distributors, VUDU offers the largest catalog of any online movie distributor and new movies and TV shows are added weekly.

Anyone who purchased a VUDU box in the last 30 days can receive a $100 movie credit with proof of purchase whether they purchased the product from VUDU.com or from any other retailer by contacting VUDU Customer Care (888-554-VUDU).

At the recent Consumer Electronic Show in Las Vegas, VUDU announced the addition of 70 HD movies from top studios and unveiled the VUDU XL, a brand new high-end version of the already successful VUDU box. The new product, designed for integration into high-end home theaters, will ship by the end of the February.

About VUDU

VUDU is dedicated to bringing instant access to video entertainment including thousands of mainstream movies, HD films and TV shows to every living room. Through relationships with every major US movie studio and more than 22 independent studios and international distributors, VUDU offers the optimal home entertainment experience for consumers. VUDU gives movie and TV fans the ultimate in flexibility and choice. Consumers can finally watch what they want, when they want-no planning needed, no computer necessary, no software downloads, and no cable TV service or satellite subscription required.

I still say download services like this should be incorporated into other devices – as Unbox is on TiVo and Netflix is doing with LG – or, failing that, the hardware needs to be dirt cheap. How about a $99 VUDU box with minimal internal storage and the ability to delete and re-download purchases, and support for external drives to allow people to bring their own storage. $99 would get the box into more homes, and those who really use it will add-on storage.

On the up-side, VUDU is also adding 70 more HD films in January. Instant HD playback requires a broadband connection of 4Mbps or greater. That would make me nervous – 4Mbps is extremely low for HD streams, even using 720p and H.264 or VC-1. You really have to over-compress HD content to squeeze it into 4Mbps.

Via EngadgetHD.

They dropped a press release about the promotion:

Dec 19, 2007 08:00 ET

VUDU Offers Free Boxes to Customers Who Purchase Select AQUOS 1080p High Definition LCD TVs Through Vudu.com

Access the World’s Biggest Assortment of High Quality Digital Content on Select Sharp AQUOS LCD TVs During Limited Holiday Promotion

SANTA CLARA, Calif., Dec. 19 /PRNewswire/ — VUDU Inc., the company that brings instant access to video entertainment to the living room, announced today that they will offer a free VUDU box to customers who purchase select models of the AQUOS high definition televisions through Vudu.com over the holidays.

The free VUDU box will be offered through January 5, 2008 on purchases of Sharp AQUOS televisions with 42″ or larger screens. (visit http://www.vudu.com/sharp.html for details)

“This holiday offer guarantees that new owners of the finest high definition product in the world will have direct access to lots of great content with superior picture quality,” said Bob Scaglione, senior vice president and group manager, Product and Marketing Group, Sharp Electronics Corporation. “Through this offer, new AQUOS owners will be able to instantly enjoy thousands of movie titles, television content and more on a pay as you go basis.”

Just last week, VUDU became the first service to offer an HD movie for digital purchase on the same day and date as the title was released on both Blu-ray and HD DVD high definition formats at retail stores.

“We’re adding loads of HD quality content to the VUDU service so AQUOS owners will have thousands of new and classic movies, TV shows and more from which to choose. HD movies will be lighting up high definition screens everywhere across America this holiday season,” said Tony Miranz, VUDU’s Co-founder and EVP of Sales and Business Development.

The company is also currently offering a limited number of television programs that are available on demand at a per-episode price. VUDU plans to expand its offering of television content in 2008 as well.

For VUDU titles that are not natively in HD format, VUDU up-scales content to a quality comparable to 1080i/1080p24 for a picture quality that is superior to an over-the-air broadcast and better than most DVDs. Because the box is always connected to the Internet, VUDU can continually update the quantity and quality of the content available to customers. Each week, new content is added to the VUDU service giving consumers instant access to the new content they most want to watch.

About VUDU

VUDU is dedicated to bringing instant access to the best in video entertainment to every living room, including both television and theatrical releases. Through relationships with TV networks, every major US movie studio, and more than 22 independent studios and distributors, VUDU offers the optimal home entertainment experience for consumers. The company was founded in 2004 and is headquartered in Silicon Valley. http://www.vudu.com/

Source: VUDU Inc.

CONTACT: Tara Wagner of SutherlandGold Group, Tara@sutherlandgold.com,
+1-917-509-5399, for VUDU Inc.

Web site: http://www.vudu.com/

An article in PC Magazine sheds a little more light. XStremeHD will have a ‘server’ in the home, which receives the content from the satellite. There will be three models of server, with capacities ranging from 500GB to 2TB, with the low end storing 30 to 70 titles, and the high end up to 280. (I’m guessing the third, unmentioned size is 1TB.) The server can distribute content to media receivers around the home.

XStremeHD will used leased transponder capacity to delivery content to a small dish at the home. Which satellites will be used is unknown, but it is known that they will not be using DirecTV or DISH Network birds. Users will be able to self-install the dish, or they can utilize an installer to set everything up. Content will be distributed in MPEG-2 or MPEG-4 formats in full 1080p, with audio up to 7.1 channels. That compares favorably with Blu-ray or HD DVD for movies.

What isn’t clear is the way the content will be distributed. Will be a pre-downloaded, as Moviebeam used to do, so that users can only watch the films already stored locally? Or will it use on-demand streaming to provide a wider assortment of content, like VUDU does? Or some combination, say where the first X minutes of a number of programs are stored locally and the rest is pulled down dynamically, to allow immediate viewing while giving the system time to download more? The article doesn’t really clarify that at all. It opens with this:

A new service that will fill a set-top box with high-definition, pre-downloaded movies will launch early next year…

But it later states:

The technology will apparently use streaming; Gonzalez claimed that consumers will be able to watch movies within five minutes.

So which is it? I guess we’ll find out at CES.

The same article has some info on VUDU. While the MSRP is $399, it seems VUDU also sells the boxes for just $99 to “evangelists”. It sounds like they’re seeding boxes with users willing to talk them up online:

However, Cosson also confirmed a report by blogger and former Wall Street analyst Henry Blodget that VUDU offers discounts to “evangelists”. Although the VUDU boxes are normally $399, VUDU offers evangelists the option of buying the box for $99, together with an additional $99 worth of movie credits.

“There is no quid pro quo,” Cosson said. “We are just giving them suggestions to what they should do as an evangelist.”

According to an e-mail Blodget said he received, VUDU suggested that evangelists “educate others about the benefits of getting movies delivered over the Internet and directly to the TV,” “respond to third-party blog postings,” “participate in online surveys and help us shape the product’s evolution,” “present the product to friends and acquaintances by hosting movie parties,” and “be [VUDU's] eyes and ears in the marketplace.”

Heck, for $200 (box and movie credits), I’d probably check it out too. While I don’t like the idea of Yet Another STB in my entertainment center, it would be easier to swallow if the costs weren’t so high. $400 buys a TiVo HD and a decent service period, and then you can use Amazon Unbox for movies. While Unbox is still SD only, it is expected that TiVo will be adding HD downloads (maybe we’ll hear something at CES). And right now VUDU is still really SD, the handful of HD content is more a demo/trial at this point. If VUDU could find a way to drop the acquisition costs and make their money on the content, I think they could shift some more boxes.

Via Gizmodo.

Even at that price, I’d have problems recommending VUDU to anyone who wasn’t a *serious* movie buff. Someone who would be renting movies several times a week, if not nightly, to justify the purchase of a uni-tasker STB (as Alton Brown might say). If it drops under $200 my reservations would decrease. Get it down to $99 and no problem, I’d probably pick one up just for the hell of it. But if someone had ~$250 to spend I’d sooner recommend a TiVo HD. I think most people would get more use out of a DVR than the VUDU – and the TiVo always has Amazon Unbox as a download option.

VUDU needs to lower the price further and/or add more capabilities to the product to provide what I’d consider a good value. Ideally they’ll make their software, which is quite well done, a service on other platforms – TiVo, SlingCatcher, Blu-ray or HD DVD players, etc. Convergence, it is time. (I’d really love to see it as a service on the SlingCatcher.)

Picked up from ZatzNotFunny.

I feel very strongly that, at this point, a one-trick pony is doomed in this market – unless it is very, very inexpensive. Even then consumers have ‘box fatigue’ and are tired of putting Yet Another Box in their entertainment center and finding a place to connect it. Convergence is where it is today – which is why Unbox on TiVo was a great idea – and Netflix on TiVo would be too. This is also why Apple TV has been lackluster at best, and Akimbo and Moviebeam pulled out of the hardware market completely – and why I believe VUDU will fail as well.

We have VOD available through pretty much ever cable and satellite operator now. TiVo has Unbox. Xbox has video downloads – including HD. Sony just announced they’ll be bringing downloads to the PS3. Modern hardware is so powerful that it can perform many functions, and do them all well. There just isn’t a place for a horde of single-purpose boxes today. The comments on the ZNF post seem to agree with my viewpoint as well.

Netflix should partner with someone – or multiple someones – who already have STBs in the market. TiVo has said their partnership with Amazon isn’t exclusive – so they’re a possibility. Microsoft would likely welcome more content in XBox Live for 360 downloads. Netflix could do downloads, or streaming, to a PC and support viewing over a Media Center Extender. Or work with the MCE companies to stream right to the MCE over broadband.

Stop reinventing the wheel. Unless your system requires specialized hardware (like a Slingbox), we don’t need a new box. Something like the SlingCatcher I understand, it is a client for another hardware device and isn’t a one-trick pony.

Personally, I’m impressed as a geek by their BitTorrent-like technology, but I’m not impressed by it as a product. It is yet another set-top box you need to buy and put in your entertainment center – for $399, not cheap. And you need a reliable high-speed Internet connection since it downloads movies on-demand. Low-end DSL and cable modem services may not be fast enough, and dial-up is, of course, right out – you need downloads of at least 2Mbps. You’ll also need to be sure your broadband provider doesn’t have usage limits since you’re Vudu will be downloading a lot of data – and uploading it as well.

Uploading? Yes. Vudu works like BitTorrent, peer-to-peer (P2P). When you select a movie to watch your Vudu box begins downloading it. But it doesn’t just download from Vudu’s central servers, but it will download portions of the film from other Vudu units out there that have already downloaded the film. The more Vudu boxes which have the film, the faster your box can pull the pieces together. So your Vudu will also be a node on the Vudu P2P network, serving data to other users.

Of course, the $400 for the box just gets you the box. You have to pay for the content as well. Movie rentals range from $.99 to $3.99 – with Hollywood blockbusters and new releases toward the high end of the range, and nth-tier direct-to-video releases at the low end -as you’d expect. Vudu also offers purchases for $4.99 to $19.99. Vudu is launching with a library of roughly 5,000 titles. Current content is all SD, though the Vudu will up-convert content to pseudo-HD via its HDMI connection. Vudu plans to offer real HD content in the future.

I just don’t think it is worth it. You can get a TiVo and have a premium DVR – with access to Amazon Unbox downloads. And the TiVo Series3 and TiVo HD will also up-convert content over HDMI – and Unbox is reportedly going to offer HD content in the future as well. Alternatively, Microsoft offers downloads, including HD, for the Xbox 360. And you can get a 360 for less than a Vudu – and you’d have a game box which can also be a DVD player – and HD DVD with an add-on. Sony will also be launching a download service for the PlayStation3, which will likely include HD content. The PS3 is a little more than the Vudu, but you also get a great game platform – which also plays (and up-converts) DVD as well as playing Blu-ray. And then there is Apple TV, which provides another platform for getting downloaded content on your TV, with more capabilities than the Vudu. And, of course, Netflix is always an option.

Based on the price and the narrow feature set, I just think there are better options.

EDIT: Gizmodo also has a review with a lot of photos.

VUDU Brings Instant Access to Thousands of Movies Directly to the TV, Without Requiring a PC

Company Partners with Major Movie Studios and Numerous Independent and International Distributors to Create New Living Room Movie Experience

SANTA CLARA, Calif., April 30 /PRNewswire/ — VUDU, Inc. announced today that it has closed deals with seven major motion picture studios: The Walt Disney Studios, Lionsgate, New Line Cinema, Paramount Pictures, Twentieth Century Fox, Universal Studios, and Warner Bros. Entertainment. Upon launch, VUDU will be the only company to offer instant access to more than 5,000 titles directly on their televisions, without requiring a PC or a cable or satellite TV subscription.

“We’ve created the product everyone wants, the product many have tried to build, and, until now, the product no one has succeeded in delivering,” said Tony Miranz, founder of VUDU. “We’ve brought together the best team in Silicon Valley to give movie lovers the ability to watch thousands of movies instantly, without leaving their homes.”

Under the company’s wide-ranging licensing agreements, VUDU’s studio partners will provide new releases, along with select titles from their coveted libraries. In addition to entering into licensing agreements with the major studios, VUDU has struck deals with 15 top tier independent and international film distributors.

The VUDU team, led by Mr. Miranz and Chairman Alain Rossmann, consists of consumer electronics and Silicon Valley technology veterans from TiVo, WebTV, Openwave, 2Wire, Slim Devices, OpenTV, and Danger. The company has received funding from Greylock Partners and Benchmark Capital.

“VUDU has nailed the customer experience,” said David Sze, a general partner at Greylock Partners. “We think this will be a real hit with people looking for the best and most convenient way to get movies into their living rooms.”

“There are very few teams in consumer electronics that truly understand how to build a product that will ‘wow’ the customer. This is one of those teams,” added Bill Gurley, a general partner at Benchmark Capital. “VUDU has a combination of features that no one else can match: a phenomenal selection, incredibly easy interface, and the ability to instantly begin watching any movie you choose. The results are incredible.”

For more information, visit www.vudulabs.com.

ABOUT VUDU

VUDU, Inc. was founded in 2004 and is headquartered in Santa Clara, California. The company is dedicated to bringing instant access to thousands of mainstream movies to every living room.

Source: VUDU, Inc.

CONTACT: Amanda Sanyal of SutherlandGold Group for VUDU, Inc.,
Amanda@sutherlandgold.com, +1-415-934-9600

Web site: http://www.vudulabs.com/

VUDU looks to be primarily a competitor with AppleTV. It is a small box, described as being about the size of a hardcover book, that connects to your TV and home network and allows you to download video. It seems similar to past dedicated appliances such as Akimbo and MovieBeam. Both of those services bombed in the market. Akimbo has refocused more on service than the device, offering their content via Windows Media Center PCs now. MovieBeam is effectively dead, it remains to be seen if they re-launch.

So, what sets VUDU apart? The hardware is more advanced. They’re using MPEG-4, and the box has HD output. The box has HDMI, component, S-Video, and composite output. Audio has optical digital out, coax digital out, and RCA stereo. There is an Ethernet port for the network connection (but no built-in WiFi). A USB port, what appears to be a coax jack (but I can’t read the label), and, interestingly, an ‘IR Out’ jack – not sure what that would be used for. The remote control is funky – just five buttons and a scroll-wheel. Other details, such as the size of the hard drive, have not been revealed. The final price hasn’t been announced, but it is currently set at around $300 – the same price as AppleTV.

VUDU works a bit differently from the other devices as well, similar to the Joost software currently in beta – it utilizes P2P. Instead of all downloads coming from one central server, VUDU units use a BitTorrent style P2P network so that other VUDU boxes that already have the content will send parts of the file to the requesting unit. This will greatly reduce download times, just as BitTorrent does. Additionally, VUDU will use a predictive system, in a way similar to TiVo Suggestions. Based on predictions of which content is most likely to be rented, VUDU will download the start of the video file in advance. This allows the user to start playback immediately, while the unit continues to download the rest of the file in the background. That’s pretty clever.

But, more than the hardware, VUDU seems to have managed to do something no one else has yet been able to do, including Apple – they’ve already negotiated content deals with every major studio – except Sony Pictures Entertainment, as well as several independent studios. From their site:

VUDU has struck unprecedented deals with seven major studios and numerous independent and international distributors to offer thousands of titles, from mainstream new releases to smaller, more specialized films. Via their broadband Internet connection, VUDU users will have the ability, on a studio-specific basis, to rent or buy movies and begin viewing them instantly.

According to the New York Times articles, VUDU already has over 5,000 titles licensed – before they even launch, from the seven major studios and 15 smaller studios. That’s 10 times the 500 films Apple offers from just two major studios.

VUDU’s is headed by people with a lot of experience – two of them are ex-TiVo employees. Edward Lichty, VUDU’s Chief Operating Officer, spent eight years at TiVo. VUDU’s Vice President of Engineering, Andy Goodman, was the second hire on TiVo’s software team. There is even more from the Times article:

By mid-2005, after raising $21 million from two Valley venture capital firms, Greylock Partners and Benchmark Capital, Vudu was ready to begin designing the box itself. Mr. Rossmann said he advised Mr. Miranz to “get some DNA from the company with the closest experience to what we are going through: TiVo.”TiVo’s set-top boxes have snared a passionate audience over the last decade by offering time-saving utility with a simple user interface. Vudu hired 11 TiVo veterans to help steer product design and manufacture its box.

Since VUDU is a 41 person company, as per the Times article, more than a quarter of the company is ex-TiVo.

VUDU emphasizes the video purchasing, and it isn’t clear if the device will act like a media center extender and allow access of any local media. I would hope that it would, it appears to have all of the bits to do so and it would make the box a lot more useful if it did more than just download video from the net. Being able to access local music, photos, and video would make the device much more useful.

In any case, it would be yet another box to have under the TV – and it is getting a little bit ridiculous. I’m a gadget geek, and I have two TiVos, a DVD/LD player, VCR, A/V receiver, and Slingbox Pro under my TV – and an Ethernet switch to handle the devices. TiVo already handles local media – music and photos, and transcoded video. Amazon Unbox gives it movie downloads – the main thing lacking right now is HD content for the Series3, but this is supposed to be coming. Even with the content deals, are consumers willing to pay another $300 for another box that just allows them to pay for downloadable content? Even as a gadget geek, I’m not sure I would be willing to – especially if HD content comes to TiVo Unbox. Microsoft already has downloads on the Xbox 360, including HD content. And Sony will be bringing downloads to the PS3 – which is probably why they’re not dealing with VUDU.

It seems they’ve thought about that too:

Vudu executives even consider the possibility that their hardware box might eventually melt away, with its services running as the video-on-demand feature in a satellite box, video game console or a new breed of high-definition televisions.

Personally, with all the TiVo connections, my dream would be to see this service land on the Series3. (I doubt it would appear on the Series2, since they don’t do MPEG4.) It could also land on devices like the SlingCatcher. I would like to see more convergence, fewer boxes.