Amazon Considers Movie Downloads

Sources near Amazon say that the company may be close to offering downloadable movies, with discussions ongoing between the online retailer and movie studios Universal, Paramount and Warner Bros. The service could open its doors by this summer.

Amazon has already toyed with the idea of online DVD rental, and is looking into a digital music service of its own. With the success that Apple has seen by adding video content to its iTunes Music Store, some companies are looking into ways to monetize online video content.

According to the New York Times, large DVD retailers like Wal-Mart and Target are in similar discussions to add a digital component to their movie sales. Negotiations are ongoing, say sources, however Amazon declined to comment on the news.

Downloadable movies are not new; company like CinemaNow and MovieLink have been doing it for years. But a high profile site like Amazon offering such a service could easily blow the market wide open.

Studios are considering offering the downloadable versions of movies at the same time the DVD is released. They are also aiming for purchases rather than rentals due to higher profit margins, say sources.

No price structure has been set, nor what movies would be included. A mix of new releases and older hits is expected, however.

News of Amazon's plans was first reported in both the New York Times and Wall Street Journal on Friday.

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