AOL has struck a deal with broadband film rental service Movielink, offering downloads for 99 cents a title (for a limited time). While that's a nice price, the multitude of restrictions (Windows OS and IE only, DRM restrictions, and poor signal quality when output to televisions) make the service less than ideal. The deal comes after Movielink CEO Jim Ramo recently claimed "video on-demand is here today". Of course after he made that statement at USTA Telecom 03, he went on to say the sector won't really take off until they can reach the living room; but who's keeping score?

Studio backed Movielink quickly elbowed out independent competition like Intertainer and set up camp, with early reviews being less than favorable. Analysts have charged the services exists as a brand recognition device, and really can't compete against digital cable and satellite. Movielink primarily exists as a claims flag stuck into the broadband film mountain.

"We'll play around with the Web to put a good face on it all," noted one anonymous studio executive around launch-time. "But, really, all we want is a renewal deal with cable that gives us a bigger piece of the pie."

BellSouth, Roadrunner, and Terra Lycos have recently signed deals that deliver a modified version of Movielink's services, users paying $2.95 and $4.99 for a 24-hour viewing period (the same price as traditional Movielink rentals). The 99 cent deal through AOL will exist throughout February, after which we assume pricing returns to normal (more details via CNET).

There are obvious restrictions that have turned off some users. Customers have 30 days to watch the film and 24 hours to complete it once viewing begins. Of course a big strike against it among our users is that it requires a Windows OS and Internet Explorer 5.0 or higher to function. Even if you do manage to route the signal to your living room television set, the films are closer to VHS than DVD quality.

The service also isn't going to be winning races anytime soon. Over a 1.5 Mbps broadband connection, downloading a full film takes at least half an hour, though the company has worked to integrate a caching "Movies in Minutes" feature that begins playing after several minutes.