George Ou over on Zdnet wrote an excellent piece outlining why those too-good-to-be-true HD downloads we see in Xbox 360, ABC.com and even Apple TV are a bit bogus. He points out that while these services deliver on their 720p resolution promises, the encoded bitrates are so low, compressing the data to such small proportions, that the image within the said resolution has inadequate fidelity. He's dead wrong, forgetting that MPEG-4 generation codecs can take the same bitrates from sources like DVDs and ratchet up the res and quality in the same space. Duh. [zdnet via engadgethd]
There needs to be some different designation, because highly compressed 720p is not in the same league as 1080p. Based on (admittedly, only a half an hour of viewing) what I have seen of the Apple HD download, it is not in the same league as 480p DVD's. This, along with the fact that people prefer to physically hold what they purchase, is why most of us say the death of physical media is greatly exaggerated. There will be a day when most people get their movies from the information superhighway, but it is still years away.