Prices will range from $3.99 for downloading a blockbuster like "Harry Potter" to $2.99 for other titles.

"Making major studio content available to download in a secure and legal manner marks a tremendous leap forward for online distribution," said CinemaNow's Bruce Eisen, an executive vice-president.

Hollywood's studios are wrestling with how and when to begin offering downloadable movies to Internet users in the face of unsettled issues ranging from copyright protection and technology to pricing.

But the current view among the major studios is that if they don't begin making Web-based movies available soon, they could be eclipsed by movie-swapping services. In that way, the studios might lose revenues much like music companies did to song swap sites like Napster, before it was shut down.

Major record labels have launched several subscription-based Web sites for downloading music under names like Pressplay, MusicNet and FullAudio, but they have failed so far to reach the mass appeal of the free, unauthorized services like Napster.

CinemaNow is different from a swap site, however, because it licenses the movies from filmmakers, charges users who want to watch them on their PCs and provides highly encrypted digital movies that make it hard for the pirates to copy.

Previously, CinemaNow has offered films from independent companies. It is majority owned by indie filmmaker Lions Gate Entertainment Corp. , and minority partners include software's Microsoft Corp and video chain Blockbuster Inc. , a unit of Viacom Inc. whose companies also include Paramount Pictures.

Warner Bros. and with four other major movie studios hope to launch their own Web-based video-on-demand service, called Movielink, in the fourth quarter of this year.

Separately, computing giant International Business Machines Corp. said on Monday it will supply the technology to run Movielink.

But for now, online movie watching is hampered by several problems, most prominently copyright protection and slowing developments in computing and communications technology.

It can take one to two hours to download a full-length feature film using high-speed broadband technology and depending on computer processor speed, Internet Service Providers and various other factors.

For Web surfers with dial-up connections, which is the vast majority on the Net, movie download times are far longer.

Still, CinemaNow boasts nearly two million video streams to roughly 1 million users a month. It uses its own software called PatchBay to manage digital distribution issues like copy protection, user profiles and pay-per-view services.