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Sony Video-Downloading Service Faces Stiff Competition

Sony launched a video downloading service Tuesday that allows users to rent and purchase movies and TV shows. It hopes to gain an edge in the market by letting users view programming on their hand-held PlayStation Portable devices as well as on TV sets. Sony previously said it plans to make the service available through other key products -- such as its Vaio computers, Walkman music players and Sony Ericsson mobile phones - by March 2011.

Sony faces stiff competition from rivals such as Microsoft and Apple, which are already a step ahead in such services. Microsoft on Monday announced a deal with Netflix to stream movies over the Internet to the Xbox 360 game console.

Sony's new service will be a test of how well the company has been able to change its traditional hardware-oriented mindset and move toward integrating software, services and content in a way that appeals to consumers. CEO Howard Stringer has been laying the groundwork for that transition by promoting executives with strengths in software and content.

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