Amazon Talking with Netflix And Blockbuster

Mike from HackingNetflix.com writes "Reuters is reporting that 'Amazon.com has approached online DVD rental service companies, including Blockbuster and Netflix, to explore a partnership rather than launching its own U.S. DVD rental service.'" More from the article: "Despite its online might, shopping giant Amazon faces a potentially expensive battle to crack the competitive U.S. online rental market. The company started its own DVD rental service in Britain in December. Rumors that Amazon would enter the U.S. online DVD rental market sparked a price war late last year between Blockbuster and Netflix, which pioneered online DVD rental and now controls about 75 percent of the market." So there may be a happy ending to this tale for Netflix after all.

Comments

Don't forget about Wal-Mart

[tech-hawger]

they're going to be a dvd rental force to be wreckoned with, oh yes. ;)

Re:Don't forget about Wal-Mart

[Anonymous Coward]

Not likely. Online video rentals are really about quality vs quantity and that is not Wal-marts forte. Netflix has a large selection of movies but may not always have enough of the most popular ones. Walmart would always have enough copies of popular dvds but would have a limited catalog otherwise. Besides if they were going to break into video rental they would have done it as brick and mortar first.

Re:Don't forget about Wal-Mart

[GodBlessTexas]

As long as you like full-frame DVDs. They even sell widescreen TVs now, but their DVD selection is still slanted towards full-frame.

Re:Don't forget about Wal-Mart

[dq5 studios]

I was just at a wal*mart getting some food and they had a huge widescreen tv set up with the star wars frito-lays display. On the widescreen tv was running a full frame version of phantom menace with big black bars on the sides.

dvd streaming?

[rovingeyes]

Amazon has been one of the innovative online business for a long time. How about streaming rental service? Strike a deal with Tivo or somebody else. Why don't they still embrace the future?

Re:dvd streaming?

[hendridm]

How great it would be for me to turn on my media center, click Movies, and choose from PPV movies streamed ala Amazon, Netflix, etc. Very cool, assuming the quality was fairly decent and the price was in line with local rentals.

Well, I'm certainly in.

[Leontes]

Yeah, I wouldn't mind a piece of the pie as well. Netflix, let me jump on the back of your obviously well designed and considerably successful business. Will you just send me a check, or should I do anything else?

Re:Well, I'm certainly in.

[GodBlessTexas]

It's not that simple. What Amazon brings to the table is exposure. Amazon is without a doubt the world's largest on-line retailer with the most exposure, and that's something that Netflix can capitalize on. Most retailers or sales oriented companies would give up body parts to partner with Amazon, and that includes some very high profile companies like my previous employer who was the market leader in luxury retail.

What is it with?

[l4m3z0r]

What is it with the attitude that _____ is dying. For instance in this case omg netflix was dying but its a good thing amazon jumped in to save them. Thats not whats happening here, netflix was never dying and they did not need amazon to resuce them.

Apple is dying, Tivo is dying, BSD is dying, netflix is dying etc etc etc... /me is tired of hearing this kind of nonsense.

Re:What is it with?

[l4m3z0r]

I've used both, I prefer netflix for 2 reasons. Better selection and cleaner/less annoying interface for movie selection.

I agree the articial wait stuff is annoying but, blockbuster is playing good now, you just watch and see what happens when they can no longer subsidize their online service with there brick and mortar stores. What it comes down to is that they can take losses and just soak up cash from there already existing business. They aren't commited to offering you this service, they are commited to burying netflix and then they will go back to the brick and mortar which is WAY more profitable. Watch and see..

Extortion?

[pla]

Reuters is reporting that 'Amazon.com has approached online DVD rental service companies, including Blockbuster and Netflix, to explore a partnership rather than launching its own U.S. DVD rental service.'" More from the article: "Despite its online might, shopping giant Amazon faces a potentially expensive battle to crack the competitive U.S. online rental market.

Ummm... Does anyone else read that as "we plan to take over your market but might have trouble getting started, so just give us a cut and we'll let you live"?

NetFlix already has a healthy base of customers, and anyone interested in such a service already knows about them. What does Amazon have to bring to the table, other than not crushing them like a bug?

Re:Extortion?

[Brian Quinlan]

NetFlix already has a healthy base of customers, and anyone interested in such a service already knows about them. What does Amazon have to bring to the table, other than not crushing them like a bug?

A stronger brand. Despite what you say, I doubt that most interested comsumers are aware of online DVD rental.

And/Or

[Prince Vegeta SSJ4]

so just give us a cut and we'll let you live"?

and/or they feel that by entering the market they will further commoditize DVD rental prices, & decrease margins. This could make the business less profitable for all involved. By trying to come up with a partnership, prices could potentially remain higher than otherwise.

Re:And/Or

[Dun Malg]

what you're talking about is collusion, and very very very illegal.

No, not when there's an overt partnership. It's only collusion if they are competitors who "unofficially" decide that they're going to keep prices artificially high. It's not collusion if the two are actually in business together.

I wonder

[Nothing Special]

what is the viability of startubg a DVD mail service right now? Are they trying to build a client base for the inevitble switch to streaming, which granted is still a few years off, or just trying to get in and steal a bit of market share while they can. hmm. it reminds me of back in 2001, when i worked for an internet kiosk company. we all knew that wireless tech was hitting the market and that it basically spelled doom for the company, but the higher ups hoped to make as much as they could and (hopefully) sell the company off to a major player before wireless came to fruition...the company was gone within 2 years.

Already happening at amazon.co.uk

[Richard_at_work]

Amazon.co.uk already provide this service, which I think is backed by Lovefilm.com (email me for a double length free trial, 28 days instead of 14), which is basically the top UK online DVD rental site (run by Online Rentals Ltd). Ive been a Lovefilm member for 16 months now, and I dont have a single word of complaint about them - fast service, good rates and a very easy to use site.

Competitive Market

[ChibiLZ]

I really don't think the market could hold another major competitor, so partnering with Blockbuster or Netflix would be a smart move... Although I heard rumors that Hollywood Video might also be looking at starting an online movie rental business. That might be an ideal partner for Amazon, as both are fresh in the business.

Also, for a shameless plug, if there are any Netflix users out there, and you think dealing with your queue is a pain, try my new software (Windows), called FlixQueue.
http://www.5hyphen.com/FlixQueue/index.htm

Hope they don't get involved with blockbuster UK

[intmainvoid]

They could learn a lot from blockbuster UK, in a what not to do sense - I always know what DVD is coming next - it's the one from the bottom of my list!

I expect a little "buy now" button on Netfix....

[aengblom]

within six months. It sort of blows me away that it's not already there. Netflix knows the movies I like much better than Amazon. It knows what I've seen, what I've rented twice. If I wanted to browse some movies to buy I'd go to Netflix and search around, before heading over to Amazon to actually place my order.

I'll bet they'd like a cut of those revenues too.

You'd have to be at the table to know

[ianscot]

What does Amazon have to bring to the table, other than not crushing them like a bug?

There's risk from either direction. The attempt to squash them like a bug could also fail, yes, and at ruinous expense? We don't know what terms are being discussed, but there would be concessions and benefits on either side. Not that Amazon isn't dealing from a position of some strength, especially because it can play Netflix off against the Blockbuster evil empire.

Netflix is already facing Blockbuster's recent conversation to their own business model. If I was Netflix negotiating a deal of this sort, I'd be thinking that any sort of Amazon relationship could give me the presence to withstand that. I'd maybe want some sort of mutual benefits situation with respect to DVD sales off of Amazon.

(And I don't know enough about Netflix's base of customers, except that it includes me, but I'd bet Amazon has a colossally higher visibility for the average consumer. Amazon is on the level of google, with more staying power to boot. Whether Netflix has a lot of customers or not, the question is whether there's a lot of growth left in the market, and whether Amazon's presence would get at it.)

Rent DVDs from Amazon!

[Strider_Hiryu]

I wonder if I'll be able to rent used DVDs for less than new DVDs...

Blockbuster never work it

[drakethegreat]

The article seems to favor blockbustor but I don't think they are ever worth using. They have had way too many lawsuits for bullcrap late fees over the last 10 years! I know its true because its happened to my family and we stopped using them a long time ago. Personally its worth it to pay more whether that be netflix or amazon or the two of them combined.

Long Wait

[Ranger]

Amazon should go it alone. I know Amazon UK rents DVD's online but I don't know if it's partnered with anyone. Partnering with Blockbuster would be a bad idea. I currently subscribe to it. I thought I'd give them a try first because if they sucked I could always switch to Netflix. Which is what I'll probably do here soon.

Over half the movies in my queue are short wait. I have about 40 in it. Yes I can only have 3 out at a time, but there are some movies I've been waiting months for. And Netflix does have a better selection. If Amazon partners with Blockbuster then my movies will all go to long wait.

Just buy it

[Raindeer]

Netflix would fit quite well with the range of products that Amazon has. Amazon has good relations with its customers already, now it could tie them up with a subscription service. If they do it well, the customer gets referrals to movies they might never have thought of and Amazon might use information on viewing habits to suggest books. If Amazon/Netflix are smart, they will also start video on demand.

I've heard of a good rental service..

[Digital Warfare]

..its called Bit Torrent, and is usually quicker than Blockbuster !

Dear AOL User

[TimeTraveler1884]

"Apple is dying, Tivo is dying, BSD is dying, netflix is dying etc etc etc... /me is tired of hearing this kind of nonsense."

Dear AOL user,

It has become apparent to me that you have mistakenly found your way on to Slashdot.org. I do not blame you for your misplaced comments. You likely felt right at home, with Slashdot's prevalent use of Internet abbreviations and lack of capitalizing proper nouns.

However, you may not be aware that the use of "/me" is not a valid Slashdot command. Rather, it makes you sound like Jar Jar Binks. /me sa thinks you lika jar jar. I only bring this to your attention so that you don't feel alienated when someone replies to your comment citing poor grammar and misplaced IRC commands.

Hope this helps.

Sincerely,
NetZero User

Stand firm, Amazon!

[Quiet_Desperation]

I'm a Netflix fan, but think Amazon should go it alone for no other reason than I love a price war. :)

As a Netflix shareholder....what each gets....

[PortHaven]

Netflix isn't dying...it's in fact the market leader. But it's got some potential competitors who are traditionally "killer competition"

WalMart - kills competitors in markets it enters

Blockbuster - killed off most of the mom & pop rental stores

Amazon - is the dotcom that survived the dot boom/bust

Netflix - is the company that came up with a new business model and grew

However, investor/industry analysts are nervous about it because they don't know if it has staying power. There is strong potential competition (which Netflix has more than held it's own against). And there is the upcoming (for certain eventually just unknown time of arrival) of download on demand.

What Netflix has going for it in the industry.
- established
- market dominance
- market presence
- best interface

So what does Amazon get and offer Netflix. Amazon will save hundreds of millions of dollars. It will also become an "umbrella" of sorts to the investor community who will see an Amazonian partnership as a assurety of long-term livability for Netflix. And guarantee a mutually beneficial symbiotic advertising relationship. Got to Netflix from Amazon, and from Amazon to Netflix.

- The Saj