This is a pipe dream, not a viable business model. You are not going to be able to compete with Netflix. Blockbuster is going bust trying, and they have hundreds of millions of dollars to spend trying. If Blockbuster can't make it, you have about zero chance. Legally, you would have to cut deals with the major studios or get busted for copyright infringement. Either will bankrupt you, I imagine. The studios will not give you the time of day in response to a request for your start up online video store unless you have a major hitter representing you and major funding. The "ante" to enter the online video store game is probably on the order of $500M and the chances of success less than 1%. Unless you have that kind of money to blow on such slim odds or have the next big thing gimmick you will get crushed.
I am not your lawyer and you are not my client. Free advice here is without recourse and any reliance thereupon is at your sole risk. This is done without compensation as a free public service. I am licensed in IL, MO, TX and I am a Reg. Pat. Atty. so advice in any other jurisdiction is strictly general advice and should be confirmed with an attorney licensed in that jurisdiction.
I am an entrepreneur myself who started one of the earliest versions of the iTunes business model back in 1998 so I don't believe in telling Simeon that you can't from a business perspective. You would need to approach the copyright owners of the films, usually the studios for the bulk. There are also smaller companies that own the independent films. You could also try approaching a film distributor that has such rights to assign. It is a highly competitive field so you would need something that differentiates your business model and venture capital. Good luck!
With contracts, lawyers, and a fair amount of capital to spend on them. Ideas are cheap and therefore usually free, and by the way, shouldn't be disclosed so casually on a public site like this one.
But when someone spend the time and effort to actually develop something so it's protectible under contract law, then it can be worth trying to market it. Until you do that, no one will take this kind of expression seriously, and no one will do the development work for you.
Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to any follow-up comments. If you want to hire me, please contact me. Otherwise, please don't expect a further response. We need an actual written agreement to form an attorney-client relationship. I'm only licensed in CA and you shouldn't rely on this answer, since each state has different laws, each situation is fact specific, and it's impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.
If you do not know the answer to this question you are in no way prepared to embark upon the venture you have described. This is a complex arrangement involving many moving parts. It involves knowledge of technology, access to important players, capital, thorough vetting of the market and the competition, a detailed business and financial plan, and perhaps most of all, a legal opinion as to all of the issues involved. What is the expertise that you are bringing to the table that holds this venture together? When you say you have an idea, that is exactly what you have, an idea, but you need to give it some thought and then you will realize that you do not have a prospectus for a new venture. No lawyer is going to get involved in identifying and contacting all the copyright holders for exhibition rights for you at this point.