Google to Launch Major Rental Service

9:25 AM -- Google (Nasdaq: GOOG) is in talks with major Hollywood studios to launch a streaming movie rental service by the end of the year, The Financial Times reports.

According to FT, the negotiations have been going on for months but have picked up in recent days. The service will be tied in with YouTube and will launch first in the US, with other countries to follow.

One hard-to-believe detail from theFT story: Rentals of newer titles will cost $5 -- more than rentals at both Amazon.com Inc. (Nasdaq: AMZN) and Apple Inc. (Nasdaq: AAPL)'s iTunes, and more than half the monthly cost of Netflix Inc. (Nasdaq: NFLX)'s subscription streaming service.

Google has already been testing a rental service on YouTube. It began in January with independent films with Sundance and then expanded in the spring to include newer, more mainstream titles like Precious, for $3.99. This service failed to compete with iTunes or Amazon, but Google didn't really put its full promotional weight behind it. This time, FT says, Google will be using search to direct users to the service.

— Erin Barker, Digital Content Reporter, Light Reading Cable

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