I have experimented a bit with movie download services lately. This is one of the virtues being in the US. Most of the later described services are only available if you have an US IP address and US registered credit card.

I must say I'm very pleased with Movielinks services. Movielink has top DVD movies in divx quality for $1.99 to $4.99 per download. The download is fast at 1.1MBits. The download manager starts the movie usually after 5 mins of download. Having a 3 Mbit line at home I never had any interruptions so far. Also the movie selection menu provides recommendations for movies based on your user who did the same selection.

Movieflix is the super discount provider having a huge database of B and C movies but hardly any interesting movie. It's cheap but you are usually better off with free TV.

The third one is Cinemanow. The company raised several rounds of venture founding and provides probably the widest range of movies although many are older and more like B movies. The company provides many options (streaming, downloads). However the movies I had tested did perform poorly (downloads needed 50 mins before starting, streaming was interrupted). However most new movies are a bit cheaper than at Movielink.

I must say I don't see a reason to go back for renting DVDs but apparently on-demand movie download services have been a bit before their time too.