Amazon's Video Rumors

The latest about Amazon.com's (Nasdaq: AMZN  ) video store plans still seems to be in the realm of rumor, but word has it that the online retailer is planning to offer some kind of video store on its website. Details are dicey so far, so investors are most likely hoping for more information on this when the company reports earnings later this week.

According to news reports that cite Variety magazine, Amazon plans to try to merge its recent broadband media efforts with DVD sales. Although Amazon spokesmen apparently wouldn't speak to Variety, the magazine said that Amazon is seeking to offer full-length feature films from at least two major movie studios on its site. Among the possible innovations could be credits toward buying the DVDs for those who pay to stream the content to their PCs. Or it may allow buyers to stream the movies while waiting for the physical DVDs to be delivered.

It's an interesting thought, and one that investors should hope is fleshed out more when the company reports earnings. The last time Amazon reported earnings, Jeff Bezos mentioned digital downloading, stating, ". We think we have some great offerings that we can bring to our customers over time." The thing is, when it comes to digital content being offered over increasingly common broadband connections, time is apparently moving very fast. It didn't take long at all for Apple (Nasdaq: AAPL  ) to galvanize downloadable video, offering popular TV shows and other videos through its iTunes Music Store. It seemed like overnight Internet-provided video was an increasingly viable option, with companies such as Google (Nasdaq: GOOG  ) starting to get into the action as well.

Although I admit that I think many of Motley Fool Stock Advisor selection Amazon's recent initiatives have been clever and timely (take its recent announcement about Amazon Fishbowl with Bill Maher), the more I think about it, the more I think that it's in Amazon's best interests to hurry when it comes to offering more digital content. (Netflix (Nasdaq: NFLX  ) had better start thinking about the writing on the wall, too.) Plus, Amazon's got its Digital Locker idea: It just needs more stuff for us Amazon customers to put in those lockers.

Meanwhile, although DVD rentals and sales are likely not going away anytime soon -- Netflix and Blockbuster (NYSE: BBI  ) needn't be in panic mode just yet, I think -- it's certainly important to note that a company like Amazon merging the digital with the DVD sale is a savvy move indeed. If that's the case, it's aiming to get the best of both worlds.

Amazon is most certainly a pro when it comes to finding ways to differentiate itself from old-school retailing. Indeed, ideas like Amazon Fishbowl have given me the sense that Amazon is definitely trying to make its online mall not only an online destination but a place to spend some time, rather than just click, shop, and leave. It seems difficult to imagine that Amazon will remain quiet when it comes to the digital content revolution that is upon us-- and investors surely expect that it's got plenty up its sleeve.

Amazon.com and Netflix areMotley Fool Stock Advisorselections. To find out what other stocks David and Tom Gardner have recommended more recently, click here for a 30-day free trial.

Alyce Lomax does not own shares of any of the companies mentioned.


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