As if the market wasn’t crowded enough already, it looks like Netflix has yet another competitor preparing to throw down the gauntlet and step into the ring with them. This week YouTube will officially start to ramp up its streaming movie rental service, which was first hinted at last year when they premiered a handful of Sundance hits including The Cove. Now they are adding over 3000 titles, and they’ve even got a leg up on Netflix in that a lot of these are very recent, high profile releases. Some of the titles that will be up for rental this week include The Green Hornet, Inception, The King’s Speech, and Harry Potter and the Deathly Hollows: Part 1. Of course, unlike Netflix, these will all be available on a pay-per-view basis, not a flat subscription fee.

YouTube’s rental fees will be $3.99 for the newer releases and $2.99 for others, while they will also have a decent selection of titles that are free to watch. The rental period is 30 days, although you only have 24 hours to finish a movie once you start watching it. To check out what’s available over at youtube.com/movies.

I’m assuming that most of these new additions will only be available in the U.S. for the time being, as I am only able to see some of the free selections from here in Canada. Still, there are some interesting flicks that are free to watch including Peter Jackson’s Bad Taste, Richard Linklater’s Slacker, and Orson Welles’ The Third Man. While I’m not sure that YouTube will prove to be a serious threat for Netflix, they could very well cut into iTunes’ profits. What do you think, do you see yourself renting movies from YouTube?