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CinemaNow books new venue for movies

The online video-on-demand service forms an agreement with movie site to distribute its films.

Online video-on-demand service CinemaNow said Thursday that it has found a movie site to distribute its films.

The agreement with will allow the companies to create a co-branded site featuring CinemaNow films. The site is set to launch in June, offering two or more feature-length movies for purchase every two weeks. Films will cost $2.99 each and will be streamed to viewers over the Internet.

The site will initially offer "Steal This Movie," starring Vincent D'Onofrio and Janeane Garofalo, and "Heaven's Burning," starring Russell Crowe.

Big media and entertainment companies such as AOL Time Warner, Walt Disney, News Corp. and Viacom have all expressed their desire to offer video on demand.

For smaller players such as CinemaNow and AtomShockwave's AtomFilms, cracking into the studios' coveted film vaults could be difficult. To date, such companies have offered independent films. But running mainstream feature films will be the key for these companies to gain popular appeal.

CinemaNow, majority-owned by Lions Gate Entertainment, has made some overtures to the major studios as it works to build its film library. Earlier this year, the online movie service inked a deal that lets it determine where Web surfers live, an attempt at preserving territorially based distribution rights.

Executives at CinemaNow and said in a statement that the agreement would enable the companies to take advantage of consumers with broadband connections at home. The films will be available on Windows Media Player 7 and 8 and will be streamed at speeds of between 56 kbps and 700 kpbs.