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YouTube to offer movie rentals?

Video site discussing rental deal with studios

YouTube, Google’s online video streaming service, is in talks with Hollywood studios to rent new-release movies online, according to people familiar with the talks.

The move follows similar deals by Apple’s iTunes and others.

A final deal would be contingent on pricing and an agreed-upon release date, said the people, who spoke on condition of anonymity because discussions were still ongoing.

The move takes YouTube one step away from an ad-supported business model but does not break the mold of other online rental deals already struck by iTunes, Amazon and CinemaNow, a unit of Sonic Solutions. All of them offer movie rentals for between $1.99 and $3.99 each with a 24-hour viewing period.

Discussions were most advanced with Lionsgate, Sony, Warner Bros. and MGM, all of which already have ad revenue-sharing deals with YouTube, the people said.

YouTube declined to comment specifically on the talks.

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