Amazon launches DVD rental service

Amazon.co.uk has entered the increasingly crowded online DVD rental service, going head to head with existing pureplay dot-com services as well as online offerings from the likes of Blockbuster.

Like other services in the sector Amazon's offering will require users to create a list of DVDs they want to rent. Those will then be sent out with a new film being mailed out each time the last one is returned - with the added bonus of no late fees.

Unlike other services where users can rent as many DVDs as the postal service will allow Amazon is putting a limit on the number of DVDs in return, it claims, for lower fees. For £7.99 users can rent four DVDs per month or for £9.99 they can rent six.

While rival offerings theoretically offer more movies for the same money, Robin Terrell, managing director of Amazon.co.uk, told silicon.com: "Our research has shown us the average UK household doesn't rent more than six movies in a month."

Terrell believes the brand values of Amazon and its large customer base will enable the company to carve itself a place in the online rental market.

The online rental model is proving popular with consumers who don't want the hassle of having to travel to high street rental stores and perhaps aren't too fussy about which movies they want to see - given there is often a chance their first choices aren't available.

"We have over 25,000 titles in stock and we will be leveraging the strong relationships we have with the major studios to ensure we offer our customers the best possible service," said Terrell, adding that the UK rental market was chosen above other territories where Amazon operates because "it is currently underserved and too expensive".

Ironically, rival online service Screenselect.co.uk was actually set up in 2003 with the help of Amazon.co.uk founder and now Screenselect board member, Simon Murdoch after entrepreneurs William Reeve and Alex Chesterman declared their intention to "amazon-ise" the DVD rental business.

Chesterman today told silicon.com: "Amazon's move into this market is not unexpected. We certainly anticipated and it looks like a good move for Amazon. We've lots of respect for Amazon but we're specialists. We live and breathe this business which is still very different to Amazon's core business."

Chesterman believes the market is certainly big enough for several businesses to thrive and said he regards Amazon as "a respected and very worthy competitor".

While Screenselect is currently running a vast marketing campaign to promote its service and ward off competitors Amazon's Terrell told silicon.com Amazon will be making the most of the relationship it already enjoys with large numbers of customers - hence launching a whole new business unit at a time of year when resources are already stretched by Christmas shopping.

"Of course this is an incredibly busy time of year for us anyway, but that also means there are more people on the site now than at any other time during the year," said Terrell who believes exposing Christmas shoppers to the launch will kick-start subscriptions.