Amazon has launched its anticipated DVD rental service in the UK.
Other similar services have been available for a considerable period of time, with Netflix being the most popular example in the US. Customers pay a fixed monthly fee and can have DVD films for as long as they like. When they’ve finished viewing it, they simply return it in the post and receive their next DVD by return.
Amazon.co.uk is the first country to launch for Amazon. It is offering two services, £7.95 giving two disks at home and a £9.95 for four. Its offering differs slightly in that there’s a limit to the number of disks that can be viewed in each month, 4 for the cheaper price and 6 for the other. They say this is based on industry data that shows that people generally rent five or fewer films per month. Competitive services don’t impose this limit.
They’ve made no bones about their desire to dominate the area, “Amazon is determined to be the best place to rent DVDs.” Amazon Chief Executive Jeff Bezos said in a statement.
The market in the UK is pretty busy with long established companies like Movietrak and more recent entrants like retailing giants Tesco, among the many. Back in July in what was generally seen as a defensive move against the plans of Netflix to open in the UK, Movietrak and Qflicks merged. They were not immediately available for comment when we tried to contact them.
The Amazon offering is a powerful play. The new rental service is fully integrated into Amazon.co.uk’s existing DVD store, allowing DVD shoppers to rent or buy in the same area of the site and receive recommendations. They also have the advantages for current Amazon users not needing to sign up new accounts and enter credit card details as Robin Terrell, Amazon.co.uk’s Country Manager, pointed out, “Since we already have their payment and billing information, the millions of existing Amazon.co.uk customers can sign up for the programme with just one click.”
The larger companies can offer additional incentives; Tesco offers clubcard points and Amazon will be offering a 10% discount on the purchase of DVD’s.
When Amazon opens a service in the country you operate, you are bound to be worried. Expect further consolidation within the market or special offers. We understand that Netflix have delayed their plans to launch in the UK to assess the impact of Amazon’s launch.
The cost of delivering films over an Internet connection has been one of the things that has held back online film rental. DVD’s in the post are just about the most bandwidth efficient way to distribute information. 28 pence to deliver 4.7GB – you don’t get much cheaper than that … until the release of the next gen DVD formats.