Amazon to buy NetFlix?

Yes, Amazon already offers a movie download service, but that won’t stop the world’s most famous web retailer from buying NetFlix, the movies-through-the-mail company that recently built an online service of its own. At least, that’s what the Associated Press is reporting.

According to the AP, a Jackson Securities analyst named Brian Bolan has "heard buyout speculation from industry contacts." With Blockbuster turning up the heat on NetFlix and Amazon shares trading higher in recent weeks, Bolan believes the rumor makes perfect sense.

"[Amazon has] excess currency, if you will. Netflix, on the other hand, has been facing stiff competition from Blockbuster and everyone else, so they've seen their stock go lower," the AP quotes Bolan as saying. Word is that NetFlix could grab more than $1.5bn from Amazon - but this comes from Bolan too.

NetFlix made its name with an online movie-rental service that sends DVDs through the mail. But early this year, the company launched a video-on-demand service, dubbed Watch Now, that streams movies straight from the Web. Amazon's Unbox site also offers movies and tv from the web, but it requires downloads.

Meanwhile, Blockbuster is moving in on NetFlix's through-the-mail business. With Blockbuster’s Total Access service, renters have the option of either ordering discs through the mail, but they can also rent from the company's nationwide network of retail stores.®