Zediva Forced To Shutter DVD-Streaming Service

The Zediva DVD streaming service launched in November of 2010. The service offered to stream DVDs to a viewer over the internet and had prices that were much cheaper than rentals on other streaming services. I am sure that low price lead to a good number of customers for Zediva. DVD rentals on the service were $1.99 each or 10 for $10. On iTunes, renting the same movie would cost you $4.99.

With studios only getting their cut on the initial DVD sale Zediva soon came under fire from Hollywood. Major movie studies sued and Zediva lost in court back in April of this year. The argument Zediva made was that its service was no different than renting a DVD in stores only they streamed their rentals over the web. The judge in the case didn't buy the explanation.

Zediva says that it will appeal the court decision, but has suspended its operations right now. If you had credit for rentals, you may ultimately be out of luck. Zediva says that those with unused credits will be contacted after they figure out the next step.

We are suspending Zediva's operations to comply with an order by the United States District Court for the Central District of California.

While we hope to be back online soon, we don't know when (or whether) that will happen. We are disappointed by this turn of events, and that we are not permitted to serve you.

We are quite aware that some of you have unused credits with us and appreciate your patience as we figure out our next steps. Stay tuned for more information via email.

[via Gigaom]