US DVD rental firm Netflix is to release a set-top box which will let subscribers download movies and other programmes over the net.
The box will be built by LG and is the latest move in the battle among content providers and hardware manufacturers to dominate the digital living room.
Netflix subscribers will be able to use the device at no extra charge.
The box will go head to head with cable services, and devices like the Apple TV and Vudu box.
Netflix currently offers a video streaming service to its customers, using a PC. More than 10 million movies and TV episodes have been watched using the service.
But Netflix hopes delivering video over the net to TVs will boost its appeal.
But customers will still need a PC to choose from more than 6,000 titles, before it is piped on to the TV.
Netflix has spent about $40m on the development of its streaming service during the past year.
Apple is reportedly preparing to launch an online movie rental service, which could boost its own TV set-top box.
The Apple TV has not taken off in the manner of the company's popular iPod and iPhone.
Piper Jaffray analyst Gene Munster estimates about 1.8 million Apple TV devices had been sold through 2007, but he expects another 2.9 million units to ship this year.
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