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It started with a company in California named Netflix. The idea was to offer DVD rentals by mail with no late fees. They eventually went public and raised money for more distribution centers. This would allow most customers to receive their movies in one or two days. They attracted the attention of two companies called Blockbuster and Wal-Mart. Let the competition begin!

Netflix has a four year head start which helps them control the majority of the online DVD rental market share. The company struggled with adding customers until they decided on the strategy of $20 a month for 3 DVD rentals at any given time and absolutely no late fees! This plus the easy and usable online rental system allows Netflix to boast a million plus users.

The idea is pretty simple. You get online and create a rental list of your top movie choices. You rank movies so Netflix knows which titles to send first. They send out 3 movies at a time in a nifty rental slip with a return slip included. You never pay any shipping charges. Oh yeah, if your paranoid about getting charged for broken DVDs, don't, since anything can happen with mailing DVDs you simply return the broken or scratched DVD with no charges.

Netflix has not been a perfectly smooth ride. There have been some articles about the availability of new releases for avid users. Some have done studies showing that the more DVD rentals per month sometimes results in not receiving your top choice of movies. This of course is quite controversial and I am sure Netflix will control the problem if any existed in the first place.

When Netflix first started Blockbuster's solution was that movie rentals occur spontaneously, and that few people will take time to order movies in advance. Well do you remember when BlockBuster offered the monthly DVD rental for $30 bucks a month. Lets just said they started to feel the competition.

In the fall of 2002 Wal-Mart with there awesome distribution capabilities decided to enter the online DVD rental market. At the time Netflix had expanded from the original California distribution site to multiple sites. Wal-Mart also expanded to 7 shipping centers which helps users get movies faster. Wal-Mart is currently at 15,000 titles. One of the best things about Wal-Mart is they have a 2 disk option for only $15 a month. Once again Wal-Mart is able to offer a less expensive solution!

Ever heard of FilmCaddy, well BlockBuster will not make it obvious, but they own it! They started the distribution center in Phoenix. If it does well they will spend more cash and jump into the competition. To be thorough we better mention the small guys which include DVDBarn, Qwikfliks, DVDAvenue,and Cleanfilms.

The small guy that is worth more than a mention is CleanFilms. They are currently in a lawsuit with Hollywood because they rent edited movies. This is great for the many parents that want additional solutions for watching movies with their children. We will have to do an article and follow-up on the lawsuit. Maybe Cleanfilms will survive and continue to offer family edited movies.

If you find yourself paying late fees, online DVD rental might be the solution for you. If you are like me it is probably easier to choose a movie online than walking up and down the isles at the video rental store only to end up with your second or third choice. Give one of them a try, most of them offer a free trial period.

Article Update... February 2005

Netflix raised their prices in June of 2004 to $22 a month. This caused quite an uproar from loyal customers. Faced with pricing pressures from Walmart and other online DVD rental sites, Netflix lowered their price to $17.99 a month. They also started a $11.99 option for 2 movies at a time with a maximum of 4 movies per month.

Blockbuster also is expanding, and already lowered there monthly service from $19 to $17.50 a month. It seems like there is going to be a heated battle for the online DVD rental service. It looks like the big winner is the customer!

Article Update... May 2005

Walmart sold their online DVD rental service to Netflix. Netflix announced they have reached a deal in which Walmart would close its online DVD rental store and direct customers to Netflix. Current Walmart subscribers will be allowed a one-year Netflix subscription at the current Walmart rate.

Free DVD Rental Comparison Many are taking advantage of the free DVD rental trial periods. A lot has been written about which company is better and how best to choose between them. Most articles focus on two main points, price and selection, however they leave out one very important factor time!

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