Digital Home Thoughts: Blockbuster to Buy Movie Download Firm

" Video rental chain Blockbuster Inc. said Wednesday it is buying the digital movie download service Movielink, giving it the online foothold it has long sought to compete with rival Netflix Inc. Blockbuster, based in Dallas, said it will continue to operate Movielink as a stand-alone service and eventually make elements of the service available through Blockbuster.com. Movielink was launched by five studios in 2002, marking the first time that a large supply of recent, popular films was available for rental on the Internet. The privately held service has struggled to gain popularity, even as it allowed the purchase of films and signed licensing agreements with all major studios and a large number of independent film companies."

This move makes complete sense for Blockbuster of course. Given Netflix has made the move towards allowing its customers download movies, Blockbuster just had to keep up. As the article mentions - Movielink was launched by studios to stave off enormous losses coming from people downloading illegal copies of movies over the Internet. The company is owned equally by Sony Pictures Entertainment, Universal Studios, Paramount Pictures, Metro-Goldwyn-Mayer and Warner Bros. I wonder if Netflix is really going to work to increase their repertoire of movies available for download, i.e. in order to compete with this move by Blockbuster.