Market research firm Coyote Insight is surveying consumers to find out how they'd feel about "[an] iTunes service [that] would provide access to 1,000 movies on demand," according to a report at AppleInsider. The Web site's Kasper Jade reported that the firm is exploring two business models -- a rental service for US$9.95 per month and a $12.95 option that would also allow burning films to DVD. The survey also solicits feedback on the ability to buy the movies.

However, as an iPod Observer reader noted below, Think Secret's Ryan Katz reported on Thursday that the survey has nothing to do with Apple. He said that it is from Starz Entertainment Group, which offers movies through a service called Vongo.

"Sources familiar with the survey said the example was hypothetical and that Apple had no involvement with the survey," Mr. Katz wrote. "The survey is part of Starz' on-going attempt to gauge consumer interest and only that." He also said that his sources noted Starz' willingness to partner with Apple to distribute movies through iTunes, but the company is not willing to sell Vongo.

Think Secret claims that a revamped iPod designed to play back movies on a larger display is in the works, but Mr. Katz said that with its debut "on the horizon, a source has told Think Secret "'the eleventh hour' has approached in negotiations between Apple CEO Steve Jobs and major powers in the industry over how to offer movies on-demand and that the situation is not looking good for larger deals."

According to Mr. Katz' source, Apple CEO Steve Jobs wants to allow consumers to purchase movies, as they do with music through the iTunes Music Store, but Hollywood executives are insisting only on a subscription model. While Mr. Jobs has resisted similar moves from the music industry, the reporter said that he "will have little room for compromise" in these negotiations.

Mr. Katz' source also told him that Mr. Jobs may simply sit back and see what happens. "He might think that waiting is a better solution," the source said. "But people expect Apple to be a pioneer. Not being first is not their style, nor what the public and investors look for."

4:30 PM EST: Changed article to include reference to Think Secret.