Realizing that the music download business has already been sewn up by Apple and a handful of existing and potential competitors (read Microsoft), Amazon has decided to jump into the still nascent market of Internet movie downloads.

An Amazon.com video store is expected to be open for business in about a month. Consumers will be able to order VHS Tapes and DVDs movies, and also download ad-free digital versions of full-length films and TV.

Advertising Age reports that that the service will be named “Amazon DV”. The service will offer both subscription and per download options.

The digital movie download space is moving very quickly. It seems that the market will saturate quickly and competitors will find that digital download is just another delivery channel and the fundamentals of successful digital movie sales will begin to look a lot like any other retail channel. What is now a novelty (digital movie downloads), will soon become commonplace, and only those competitors with scale, brand, and a competitive cost structure, will survive. That makes this move by Amazon a no brainer as it has everything it needs (assuming it secures distribution rights from content owners) to be successful.

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Rentin