The War over Movie Rentals is On
The much anticipated battle between renting movies through the mail (the Netflix model) and digital downloading movies over the Net is now underway, even if only in the form of skirmishes, rather than full-fledged war. Starz has started Vongo.com to compete for Netflix customers. Will Vongo represent a bigger threat than Blockbuster (which has been somewhat hobbled in its battle with Netflix)? I think that eventually hardware and software will be available to make the digital downloading model the real alternative to Blockbuster's brick and mortar business and Netflix will be out in the cold. After all, Netflix has alienated a lot of its customers by its tendency to ship movies selectively (which resulted in a class action lawsuit and a change in the wording of their terms of "service") and the mail is already less reliable than downloading (even with the technology having not quite made it to prime time). In other words, if you own Netflix, you might want to take your profits now.
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