Best Buy Co Inc plans to start an online service that allows consumers to buy, rent and download movies and television shows, the electronics retailer said on Tuesday.

The system, based on Sonic Solutions' Roxio CinemaNow service, would be built into devices sold at its stores, including television sets, portable media players, computers, mobile phones and other devices from a variety of manufacturers.

Best Buy said it has set a multiyear agreement to license Roxio CinemaNow technology. Under the terms of the agreement, Best Buy acquired warrants enabling it to purchase shares of Sonic Solutions common stock.

It expects to provide access to new movies, independent films, and older catalog movies, with some new titles available on the same day as the comparable DVD goes on sale.

The service could compete with a number of established online media destinations including Amazon.com Inc, and Apple Inc's iTunes store.

"Our relationship with Sonic Solutions allows Best Buy to quickly establish a strong position in the digital delivery of video entertainment," Brian Dunn, chief executive of Best Buy, said in a statement.

Best Buy bought digital music service Napster Inc about one year ago in an effort to compete with Apple's dominant iTunes service.

The company did not give the name of the service, or when it would launch.

(Reporting by Franklin Paul, editing by Gerald E. McCormick)