Is the distribution of video going to the SD card? MOD Systems, which scored $35 million in venture funding from NCR and Toshiba in September, hopes so.

Today, the Seattle company is introducing a new system that it hopes will replace the pre-packaged DVDs found at Target, Best Buy and other retailers. It does this with a kiosk that spits out SD cards with a person's favorite movie or TV shows on it.

"With our system, consumers can buy digital content in the places they already shop, as well as in new locations, and then play it on SD-enabled compatible devices," MOD Systems Chief Executive Mark Phillips notes in a release.

The question I have: Why go to a retail store to do this? Someone who wants to watch the latest episode of Friday Night Lights or Lost could more easily download the episode at home over the Internet or through a video on demand service, no?

MOD Chairman Anthony Bay tells GigaOm that "direct delivery into the home will continue to grow” but also notes that "people still buy stuff on impulse.” Reporter Chris Albrecht has doubts, properly noting that since SD cards are small they frequently get lost and asking if he world really needs "yet another way to get video content" with the likes of Netflix and iTunes available.

There is another thing working against MOD's new kiosk-based video distribution system. It takes two to three minutes to download the feature length films to the SD card.

I don't know about you, but two to three minutes waiting for a product to download in a retail store sounds like a long time to me. If I am buying something on impulse, usually it is a split second decision. Maybe if I had time to burn at the airport I would have the patience, but now I come fully prepared with plenty of video pre-loaded.

Still, MOD has lined up powerful support for the idea, including Warner Brothers and Paramount Digital Entertainment which are jumping on board today. With their involvement, the MOD library now stands at 4,000 titles. 

People still buy DVDs in great numbers at retail stores. The big question facing MOD is whether consumer behavior will switch to downloading those same titles at home, or whether they will feel more comfortable browsing on a kiosk at a retail store as they once did in the video aisles.

If they go to stores to buy movies, MOD's system does have an advantage over the pre-packaged discs stacked in the bins. Toshiba Senior Vice President Yoshihide Fujii says that SD card downloads allow people to choose from a "vast virtual inventory that's never out of stock."

True. But that's also the case from your living room couch.