Amazon Targets Netflix with New Streaming Video Service

Amazon on Tuesday rolled out a new streaming video service aimed squarely at market leader Netflix. Marketed as part of the preexisting Amazon Instant Video, the service is free to Amazon's best customers, those who enroll in the company's Amazon Prime service.

Amazon Prime provides customers with free two-day shipping at a cost of $79 per year. And while that's already an enticing offer for heavy Amazon buyers—Amazon claims "millions" of subscribers—Instant Video access is an interesting addition. Netflix's cheapest offering, for $7.99 per month, provides streaming-only access but works out to be about $20 more per year than Amazon Prime.

According to Amazon, Instant Video currently has more than 5,000 movies and TV shows available, but one issue compared with Netflix is accessibility. Whereas the Netflix streaming service is nearly ubiquitous and available from dozens of different devices, including HDTVs and devices that connect to HDTVs, Amazon Instant Video is currently available on Windows PCs and Macs as well as a growing collection of set-top boxes and other devices. But it's not as widespread as Netflix—at least not yet.

Amazon Instant Video also expands Amazon's previous digital video service, which provides access to more than 90,000 movies and TV shows for purchase and rent. Amazon says that there are also "thousands" of movies and TV shows available in high definition. The previous iteration of Instant Video competed with products like the Apple TV.

In somewhat related news, one-time video rental giant Blockbuster this week announced that it would hold a special auction to sell off its operations to the highest bidder. The company is in Chapter 11 bankruptcy, thanks in no small part to the success of Netflix.

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