Amazon.com launches Netflix-like UK service
According to this WSJ story (subscription required) Amazon.com has entered the growing DVD by mail rental business first in the UK and is expected to compete in the near future with the leader, Netflix, which will have 2.5M subscribers by the end of 2004:
The Seattle Internet retailer unveiled two plans under which consumers can order DVDs over the Internet and have them delivered to their homes through the mail: customers who pay £9.99 a month ($19.32) receive three videos at a time, up to six a month, while those who pay £7.99 ($15.45) receive two DVDs at a time, up to four a month. Like other companies with similar services, Amazon isn't charging late fees on videos, which consumers return by putting them into special envelopes and dropping them in the mail.
...Reed Hastings, chief executive of Netflix of Los Gatos, Calif., believes Amazon first entered the U.K. market because the entire country can be serviced effectively from one warehouse, which Amazon already operates on the outskirts of London. In the U.S., Netflix has a network of 30 warehouses near metropolitan areas so that it can provide overnight delivery of movies to the majority of its customers. Amazon has six warehouses in the U.S. for its existing retail business, many of them in rural areas.