 The landscape of the film rental market is changing |
US firm Netflix, which has made its name from supplying DVDs by post, is to roll out a new service offering instant film and TV downloads on the internet. Netflix has taken the step as analysts see downloads becoming the preferred way to access entertainment at home.
Subscribers to the "Watch Now" service will access films straight from the web rather than downloading them onto their computer to cut the risk of piracy.
However, only certain Netflix users will be able to access the service.
The group will roll out the service to an initial 250,000 customers, and add a similar amount to Watch Now each week until June.
Market battle
Netflix is already facing stiff competition in the online delivery market from names like CinemaNow, MovieFlix and Movielink.
Meanwhile, Blockbuster has improved its online offering, which experts see as an aggressive move to grab more of the market.
Instead of relying on the post to return DVDs, Blockbuster customers can now return their DVDs in-store, which allows them to get their hands on new films faster. Its stores carry an average of 5,000 titles.
Netflix has managed to maintain its lead in the DVD rental market as its library contains around 70,000 titles. It has put $40m aside to buy the rights to 1,000 films to distribute online, as well as improve and expand its technology centres.
Technology limits
Netflix's instant viewing aspect will only be available on computers using the Windows XP and Vista operating systems.
Viewers will not download films to their computers but access them straight from the internet using special software from the firm's site - so online connection has to be maintained.
Subscribers to the service will be able to view films online as dictated by their rental plans.
Different subscription deals will allow different amount of viewing time - for example subscribers with the three DVDS at once plan, will get 18 hours viewing per month.
Studios that are working to supply films to Netflix include Sony Pictures, Warner Brothers and New Line Cinema.
In the next five years Netflix aims to have 20 million subscribers who could tap into the new service.
The burgeoning online market to rent films is worth some $1bn (�508m).
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