Forget the cavernous big box stores that laid waste to the retail landscape a decade ago. Apple Chief Executive Steve Jobs’ tiny iPod has turned his company into a category killer for the digital era–first wiping out music stores and now, potentially, the corner video store.

Starting in mid-January, the Cupertino, Calif., computer and gadget maker will take on Blockbuster (nyse: BBI – news – people ) and Netflix (nasdaq: NFLX – news – people ) by renting movies from Fox on its iTunes digital media store, according to a report first published in the Financial Times earlier this week.

While older models of the iPod–and its low-end iPod Shuffle–can’t play digital video, the gadgets now have a proven record of disruption, with customers bypassing record stores to tap into illegal distribution networks, along with Apple’s (nasdaq: AAPL – news – people ) iTunes music store, to fill the up their devices.

The result: Sales of CDs fell more than 30% to 614.9 million units last year from a peak of 881.9 million in 2000, according to the Recording Industry Association. Once sprawling chains, such as Tower Records, have shuttered.

Full Story Via Forbes

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