updated 6/14/2004 2:55:50 PM ET 2004-06-14T18:55:50

RealNetworks Inc. and Starz Encore Group LLC are launching an Internet movie subscription service Monday, 18 months after the two companies first announced plans for the offering.

Seattle-based RealNetworks and Starz of Englewood, Colo., had planned to begin the service in the spring of 2003, after announcing it in December 2002. But RealNetworks vice president Karim Meghji said it was delayed because the companies didn't think the market was ready for the offering, which lets people download movies to watch on computers.

One big hurdle was broader adoption of high-speed broadband Internet connections, which Meghji said allows the movie files to be downloaded in 30 minutes or less.

The company wouldn't disclose its sales projections or say when it hoped the venture would be profitable.

But RealNetworks is hoping the service will eventually get to the point that families are subscribing and watching the movies from their regular television screens, mobile video players and other gadgets. That could take a while, however, as the technology is developed, becomes affordable and is widely adopted.

The service, called Starz! Ticket on Real Movies, will cost $12.95 a month and give viewers access to about 100 movies. The movies are available for viewing an unlimited number of times while they are part of Starz's current roster of films, but the movie is then deleted from the hard drive when the company no longer carries it.

Competitors include Movielink, which charges per movie download and is backed by several movie studios, and CinemaNow, which lets users buy subscriptions or pay per movie and is backed partly by Real rival Microsoft Corp.

The company also faces competition from Netflix, the mail-order video service.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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