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Blockbuster Offers $7.99 Online Plan

23 Jun, 2006 By: Jessica Wolf

Blockbuster Inc. is throwing out the low-price lure to potential online renters.

This week, Big Blue launched promos offering subscription rates “as low as $7.99 per month.”

The $7.99 rate allows Blockbuster Online renters to rent three titles per month, one at a time.

The Dallas-based rentailer's standard online subscription rate is $17.99, which allows users to rent unlimited titles and have three DVDs out at a time. Blockbuster's two other pricing plans allow for unlimited monthly rentals, but restrict the number of titles out at a given time to two ($14.99/month) or one ($9.99/month).

Blockbuster's major competitor in the online space, Netflix, has also been experimenting with new pricing this year.

Netflix's lowest-priced subscription option is $5.99 and allows one DVD at a time, two rentals per month, maximum.

Los Gatos, California-based Netflix says its most popular subscription model is the same unlimited rental, three-at-a-time $17.99 model Blockbuster offers.

Netflix executives in a May earnings call said its groundbreaking service will clock in with 6.3 million subscribers by year's end. This week analyst-firm Lehman Brothers estimated that number will be closer to 6.5 million. Netflix expects to have 20 million users by 2010-2012.

Blockbuster's online service had approximately 1.3 million subscribers as of the first quarter of 2006.

This month, Blockbuster filed an antitrust lawsuit against Netflix alleging that the service had attempted “to monopolize the DVD rental market through fraudulent patenting and sham litigation.”

The suit was in response to a patent-infringement suit Netflix filed against Big Blue in April seeking a jury trial to shutter Blockbuster Online

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