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Amazon to Enter the Online DVD Rental Business

Posted by samzenpus on from the rental-race dept.

ChrisF79 writes "Wired News is reporting that Amazon.com is hiring programmers to work with online dvd rentals. From the article: "Advertising for positions based at the company's Seattle headquarters, the listings seek engineers to help in 'building systems and algorithms that must move inventory between our fulfillment centers and our customers in a way that gives customers exactly what they want, when they want it.' The postings indicate they are specifically for an online DVD rental service." Netflix seems to have a stronghold on the market so despite numerous advantages for Amazon, especially economies of scale, can Amazon enter the market and surpass Netflix?"

4 of 243 comments (clear)

  1. Advantage: Amazon by jmp_nyc · · Score: 5, Interesting
    Amazon has the clear advantage here. They already operate distribution centers in several locations around the US, have experience in inventory management and quick shipping, and can even rent videos at a slight loss for a while, using it to drive business to the rest of their operations.

    Of course, if all that fails, they can follow their usual MO and file a patent for the idea of unlimited online rentals for a monthly fee and drive Netflix out of business that way.
    -JMP

    1. Re:Advantage: Amazon by bedroll · · Score: 4, Interesting
      Netflix needs better competition anyway. Blockbuster competes on price and that they give in-store rentals, but they don't compete on service.

      A co-worker recently did a trial comparison of the two services. He found that Netflix sent, received, and processed faster. Also, he found the entire sign up process easier with Netflix (mostly due to an error Blockbuster's site experienced with his sign up, which could be a one time issue). Their website is better designed. Basically, they're just a better online service than Blockbuster has been.

      Amazon has proven to be a good online service. My personal experience shows that there's rarely ever need to use anything but super-saver shipping because most things get to me just that quick. Their website works: I can find stuff, I can buy stuff.

      If anyone can compete with Netflix it's them, hopefully this will either force Netflix to continue to improve or lower their prices. That means that I win. If nothing else, they probably won't raise prices or worsen service, so I at least won't lose.

  2. Better website? by aggressivepedestrian · · Score: 5, Interesting

    I think one thing Amazon will have going for them is their website. Assuming they leverage a lot of their existing code, their initial US launch should be miles ahead of Netflix. While Amazon is constantly adding new features that help me find interesting things in the long tail, I don't think Netflix has made an improvement to their website in the two years I've been a customer.

    Don't get me wrong, I like Netflix, but the recommendations they make for me are almost always off target. On the other hand, Amazon is always presenting me with interesting recommendations on music and books.

    That's just one feature that I expect they will execute better than Netflix. They also have a slew of fetaures Netflix doesn't offer. Some of the ones I've found useful include "the page you made", "customers who bought this also bought this", "customers who viewed this also viewed this".

    Then's there's "Artist Essentials". Just getting into jazz but overwhelmed by the many choices for say, Ella Fitzgerald? Then check out her "Artist Essentials". It's just a static list, so how hard could it be to implement? But if you want an opinion from Netflix about the best movies of, say, Jim Jarmusch, well, you're just SOL.

    All in all, I'd say Amazon's entry into this market will introduce some good competition, and we're all going to benefit.

  3. Amazon owns IMDB too. by MDMurphy · · Score: 4, Interesting

    Amazon bought IMDB a while back, and luckily, hasn't screwed it up. The IMDB is the best source for movie and TV info online. When Amazon bought it, the only obvious change was making the "buy it" link in the upper left corner always point to Amazon.

    If they tie it in with the IMDB, that would be pretty handy. Search for "Virginia Madsen" and you see a list of all her movies, with boxes next to the ones available for rental. Tick the ones you want and they get added to your queue.
    This is also a plus since you could search with IMDB for any movie, not just the ones they stock. Want a movie that isn't out on DVD yet? Add it to a wish list.

    Amazon also has the setup with used DVDs ( and books ) to ofer deals if you want to buy the movies instead of, or after, renting them. I'd expect them to let you know how long your wait will be for a rental while offering a shorted length if you want to buy one now.

    Amazon also didn't pump up the IPO by paying spammers like Netflix did. Netflix will always be tainted by that.