Amazon.com has just announced the launch of Amazon Unbox, a new digital video download service offering customers thousands of television shows, movies and other video content from more than 30 studio and network partners from Hollywood and around the world. Amazon claims its new service is the only video download service to offer DVD-quality pictures. This sounds great, but when you look at what will be offered in the new service, as described below, we are not convinced this is as exciting as it could have been.

On the plus side, Amazon Unbox will deliver video content encoded at 2.5 Mbits per second using the VC-1 Advanced Profile codec. At no additional charge, Unbox also automatically includes a second file optimized for playback on any Windows Media-compatible portable device. In addition, Unbox uses progressive download, eliminating the need to wait for the entire video to download before watching. This means the typical broadband customer can start watching any Unbox TV show or movie within five minutes of ordering.

Amazon Unbox customers will be able to access their videos from a personalized Web page that indexes and organizes their media purchases from Amazon.com, including books, CDs, DVDs and Unbox Videos. Customers can download episodes of their favorite television shows that aired as recently as the previous night or favorites from decades past. Several television series and films will make their digital download debut with Amazon Unbox, including all 79 episodes of the original "Star Trek" series. Customers can purchase television series episodes for $1.99 per episode, most movies for between $7.99 and $14.99, or rent the latest movies for $3.99.

On the negative side are some restrictions with the new service. For example, Unbox only works when installed on a personal computer or Media Center PC (no Mac support). That’s fine if the user wants to transfer videos to one of a number of approved hand-held devices, but since there is no Mac support, forget about transferring the content to your iPod. And while users can store downloaded files on a DVD-ROM or other removable computer storage device - for the purpose of backup - any DVDs that are burned with Amazon Unbox files will not be readable by a DVD player.

In addition, you can only view the files on the computer that originally received the downloads, which means a dedicated PC for Unbox videos. Perhaps the biggest constraint is that the video cannot be viewed on a wide-screen display unless the "Unbox PC" is used to drive that display, either directly (through a graphics card) or indirectly (such as through Microsofts Media Extender). Perhaps we might see some interesting cross-promotions to make that arrangement easier. But to really hit the mainstream the service would have to support the huge installed base of DVD players, something thats not likely to happen unless a solution is developed to prevent unauthorized copying.

This new service appears to be aimed at competing mostly with the existing Apple iPod video service. Its use model is limited however, which means it may only become an interesting diversion that bridges applications between handheld micro-screens and the traditional home viewing setting.