That seems to be headed in the right direction.
Some additional aspects:

iTunes doesn't come close in quality to the leading high-end medium which currently is Blu-Ray Disc. The codec doesn't tell much about the bitrate, thus the actual fidelity of the video material. And if they're selling anything other than 1080p/24 material and get away with it, they deserve some respect for ripping off those who don't get it and probably never will.

MegaUpload hosted plenty of porn no content creator ever put there. They also had their MegaPorn.com daughter site and an HD version of it as well.

Still there is the assumption that people will pay voluntarily which I don't believe.