Overstock.com, known for selling products online at discount prices, will launch a video-streaming service in the first half of this year, pitting it against larger rival Amazon and its Instant Prime Video, the company announced Tuesday.
The new service will be offered through Overstock's Club O loyalty program, CEO Patrick Byrne told television executives at a national conference in Miami. Overstock will start with a video on demand services of 30,000 titles, according to the company.
Overstock's most loyal customers are turning to Amazon and other Overstock rivals to watch or rent movies over the Internet, Byrne said at the National Association of Television Program Executives conference. Target and Walmart also offer similar services, and Overstock wants its share of that market. The company, based near Salt Lake City, Utah, said customers will mainly be able to buy or rent videos for streaming.
"Yes there's some big players," Byrne said. "But really it's just begun."
Amazon boasts more than 40,000 movies and TV shows available for streaming on Prime in addition to its on-demand library. It's a way for Amazon to keep its customers inside its ecosystem and encourage them to spend more on digital and physical goods. Its Prime loyalty program, which also bundles free shipping with a slew of digital media services, includes video on-demand is estimated to have roughly 25 million members.
Overstock can do the same, said Byrne. He called the service "natural next step" for the site. Overstock has an average of 25 million to 40 million visitors a month and has seen a 42 percent increase in Club O memberships over the last year, according to the company. The new video service would take advantage of that growing traffic, according to Byrne.
Overstock would make the service available to its loyalty program, which costs $19.95 a year and includes shipping and rewards for purchases. Unlike Amazon's Prime Video, Overstock's service will charge an additional fee for video. Overstock has not yet determined that fee, Byrne said.
To woo customers away from Amazon's streaming service, Overstock plans to offer rebates of 5 percent to 25 percent off the cost of downloads.