“When you buy a song, video, iPod Game, or album from the iTunes Store, you are entitled to download it only once.”

http://support.apple.com/kb/HT1469

1) BluRay are licensed for 1 copy period where iTunes are licensed for 5 computers (and they don’t all have to by yours or in your house) and an UNLIMITED number of iPods, iPhones, AppleTV’s or soon to be iPads. That means I can buy a movie send a copy to my dad, my brother and a friend and we can all be watching it on all of our mobile devices and on any number of TV’s at all of our houses at the same time!

And although you can not make a DVD that can play on a DVD player, you can copy the data as a backup or to move it to any one of those other 5 computers (but I use the mobile me iDisk).

So itunes are vastly more sharable, normally lower priced, more convent to purchase, and in my experience very good quality. BluRay may not be dead but things get much better and we get a couple more players taking online download serious (Microsoft, Amazon, Netflilx, Sony) and it will not take all that long.

IMHO

The iTunes prices seem “a little” high because you are not getting any physical media.

I found these prices on DVD Price Search and the first three are pretty much in line with the iTunes prices and you get the physical media and don’t need to worry (or be concerned) that they might vanish if their storage device should fail.
Price Sales Tax Shipping Total Cost
DVD Empire $ 23.99 $ 0.00 FREE* $ 23.99
Amazon $ 25.99 $ 0.00 FREE* $ 25.99
DeepDiscount.com $ 26.89 $ 0.00 FREE* $ 26.89
Walmart.com $ 25.86 $ 0.00 $ 2.47 $ 28.33
DVD Box Office $ 24.58 $ 0.00 $ 4.09 $ 28.67
DVD Planet $ 28.36 $ 0.00 $ 1.50 $ 29.86
Overstock.com $ 26.91 $ 0.00 $ 2.95 $ 29.86
CD Universe $ 30.75 $ 0.00 $ 3.99 $ 34.74
(* on over $25.00 orders)

I have (as you do) a fairly extensive library of DVD’s (almost 500) titles which includes over 60 full season boxed sets. And yes it takes room to store them but I would be more concerned that the hard drive they are stored on would die before I run out of space to store them.

If the iTunes price was 1/2 of the price that was paid for when getting the media then to me that might be more reasonable.

I do agree with you that in order for this to be really workable the DRM must be done away with as it has with audio recordings. If the movies could be downloaded at a reasonable price and burned to a DVD then it would be much more reasonable.

Maybe that will happen. I remember when I got my first VHS VCR for time shifting the blank tape average cost was $25.00 each. When I purchased my last ones (some years ago) you could buy quality Sony tapes (6 hour) for about $2.00 each.

The prices must come down as they did with standard DVD movies.

When you download an iTunes product do you also get all of the extended Special Features as you would with a boxed purchase from a store?

The only movies we regularly purchase are both kid and adult friendly (think pixar), as they will get watched multiple times. They then get ripped to our media center, and the original locked up so the kids don’t destroy it. We proudly own the media for every title on our server.

For some people a slow internet connection will make this an easy choice. I assume that the discs will not cost 25 bucks in the future either …