Amazon’s protracted battle against Netflix has begun. Starting today, Amazon Prime customers can stream a library of 5,000 movies and television shows at no extra charge.

Prime will continue to cost $79 per year, and still includes unlimited two-day shipping and $3.99 one-day shipping on retail orders. Even if you never buy a single item from Amazon, the Prime video service will save you $17 over Netflix streaming on a yearly basis.

That’s not to say Amazon and Netflix are comparable. Amazon streaming is missing from a few key set-top boxes, including video game consoles and TiVo (TiVo supports Amazon video on demand but not the streaming service, for now at least). As for the iPhone and iPad, Prime support seems unlikely, especially with Apple’s new policy towards subscription services. On the bright side, the service should work on Roku, Google TV and nearly 200 connected Blu-ray players and TVs. Engadget’s Tim Stevens even got some videos running through the Flash player on his first-generation Droid phone.

The other big challenge for Amazon Prime will be content. It’s a much smaller library than Netflix’s 20,000-plus movies and shows, and if you pick through your Netflix queue, you’ll probably find a few great movies that aren’t available on Amazon (anecdotally, in my case: Wall Street and Being John Malkovich).

Television content is even less favorable for Amazon. NBC shows such as Parks & Recreation and Saturday Night Live are absent. So are ABC/Disney shows such as Lost and Grey’s Anatomy. Netflix has all of those shows and more thanks to expensive studio deals (the company reportedly paid $200 million for ABC/Disney content), and it’s hard to imagine Amazon catching up unless the Prime service becomes a huge success.

For now, it’s just icing on top of Amazon’s shipping service, and that’s fine. Anyone who wants to compete with Netflix will need some kind of hook to compensate for an inferior library and smaller list of supported set-top boxes. Amazon’s pairing of free shipping and streaming videos isn’t the most logical match, but at least it’s something different.

 
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