Apple plans to let iTunes users in the US rent films as well as buy them for download and will add Warner Bros and Fox as suppliers, according to well-placed industry sources.
Paramount, Walt Disney and Lion's Gate Entertainment are also expected to make films available to rent, said two people who asked not to be identified.
The studios already sell movies through iTunes for at least $9.99 (€6.82) each. Apple is expected to announce the rental service at its Macworld conference in San Francisco next week. New releases and older titles will rent for $3.99 for 24 hours.
The lower-priced rentals and additional titles may help boost the popularity of Apple's iPod media players, iPhone and Apple TV set-top box, which delivers shows to widescreen TV sets.
"Once a couple of studios do it, how long can the others resist?" Richard Greenfield, a Pali Capital analyst, said in an interview.
"It becomes only a matter of minutes before the others come on board too."
ITunes offers about 500 films for sale from studios including Metro Goldwyn Mayer. Apple declined to comment, as did the film studios mentioned by the sources.
Apple will also cut the price of music downloads from its UK iTunes music store to settle a European Union anti-trust case. British consumers will pay the same for iTunes downloads as customers in the 15 countries using the euro, the European Commission said in a statement yesterday.
The commission, which said Apple's prices are 10 per cent higher in the UK, said it will close the investigation.
Apple may also announce support for Sony's Blu-Ray high-definition DVD drives when chief executive Steve Jobs delivers the keynote speech at Macworld on January 15th, technology research analyst Shaw Wu said.
Mr Jobs may also use his speech to announce an update to Apple TV, which transmits content from a Mac or PC for viewing on widescreen TVs, Bear Stearns analyst Andrew Neff said. - (Bloomberg)
