Shares of Netflix--the online DVD rental store--rose 6% yesterday on rumors that Amazon.com wants to acquire it. Netflix has been growing at a significantly slower rate since Blockbuster ramped
up competition by aggressively pushing its Total Access package.
Like Netflix, Blockbuster's service enables customers to order movies online, then receive and return them by mail.
But Total Access also allows customers to return mail-delivered DVDs to its stores and to pick up new ones at no extra cost. The service operates at a loss now, but Blockbuster has grabbed significant
market share back from Netflix.
Amazon could potentially address some of Netflix's subscriber-growth troubles by marketing the service to its large user base. It could also improve
its video-downloading service, Unbox, by combining it with Netflix's if that business model gains traction. So far, Netflix has weathered the emergence of the download services now vying to wrest
control of the "movie night in" market.
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