It's no different then renting a movie at a rental store indeed, except the video cable going from the back of your DVD player to your TV is now hundreds of miles of internet data cable, instead of a few feet of composite, component, or HDMI cable. And last I checked, there were no legal restrictions on the length or type of video cables!
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appleguru writes: "Innovative movie streaming service Zediva, which rents physical DVDs and DVD players to end users though the internet, streaming their output to them, was sued yesterday by the MPAA. While there is some legal precedent, their case differs in two important ways, which may lead to a surprising, and much welcomed, victory for Zediva: Red Horne's stores, the location where the movies were being performed in that case, were public places. Consumer's homes, where movies are being performed in Zediva's case, are decidedly private places. Red Horne's employee's were the ones pressing play, and therefore the ones performing the work in that case. In Zediva's case, the end user is the one pressing play and performing the work (privately, for their own use, just as if they rented the DVD).