Anyone have experience with putting your iTunes library on an external drive, mainly with video?

I am in dire need to move my growing iTunes library to an external drive. Anyone have a suggestion for a good drive? Are there any considerations for the video component of the iTunes library? My only options on my iMac are a firewire port (I think it’s 400) and a USB 2.0 port. Will an external drive lead to lagging when video is played?