As you said…..(If the wholesaler stops making money, they change the terms with their buyer.) This is one of the things they did do was lower the price of the buybacks because they to were hemoraging business and $ due to their dealings with redbox and the flooding of product into the market. When they were asked to deny titles to redbox I know personally they were elated I’ve spoken with them. Not very often that a company roots for their biggest client to fail it insinuates that something is wrong.

You asked…(What need does the studio have to get involved at all)
It is their product being devalued of course they would get involved.

You said….(the studios want to put them out of business by denying them – and ONLY them) this statement is incorrect this involves all kiosk not just red box and this business model because it is a broken business model that is destroying an industry and devaluing a product. I’m not sure why you are skewing this because I know you know this involves Blockbuster express,DVD Play, and everybody else.

You said… (Of course, the studios could stop using wholesalers and just take care of sales themselves. Do you think that would make them more money? If so, then why aren’t they doing it?) Because in the end it destroys their business and most people in this industry see this regardless of how many extra rentals redbox adds to the pie. In the end it is a net negative impact.

Obviously Michael we are both on different sides of the fence on this issue. I appreciate your allowing the debate to rage on. I do think people get to see both sides of the issue and form their own opinions of the events that are shaping our industry.

The only reason a wholesaler would offer any kind of deal to a buyer is if it was benefiting them financially. If the wholesaler stops making money, they change the terms with their buyer. What need does the studio have to get involved at all? The studio is still getting the same amount of money from the wholesaler, right?

I see you mention the wholesalers going bankrupt – yeah, right! Like Ingram and VPD are going to go bankrupt over ONE account in ONE segment of the MANY industries they do business in (Books, Music, Video Games, etc…). That is about as likely as the studios going bankrupt over this. And, like I said, the wholesalers can change their terms with their buyers if it is no longer working for them. Is that so hard to understand?

Of course, the studios could stop using wholesalers and just take care of sales themselves. Do you think that would make them more money? If so, then why aren’t they doing it?

The problem is not that Redbox is “getting a special deal”, it is that the studios are trying to take away their right to buy movies and do with them as they see fit. If I buy a movie, I am certainly not going to let a studio tell me when I can watch it. If I want to loan it to someone, I can. If I want to rent it to someone, I can. If I want to resell it for half-retail price, I can. If I want to use it for skeet shooting, I can. That is how the first-sale doctrine works. Until the law changes, no one should be able to tell me what to do with what is now my property. Why should Redbox be treated any different?

If Redbox has to raise their prices, so be it. But it should be because the price no longer works for them, not because the studios want to put them out of business by denying them – and ONLY them – access to movies the same day others can buy them. If they want Redbox to wait 30 days to get a movie, then simply raise the price of a DVD by 50% or more for the first 30 days it is available. But don’t do it just for Redbox, do it for everyone. Simple and fair.

No other video store has this option.

The glut of used DVDs may actually cause Redbox’s wholesalers to go bankrupt.

If that happens, then the studios do not get paid for their product.

Therefore the studios are well within their rights to demand that wholesalers refuse to sell to Redbox.

If Redbox wants to play on a even playing ground, then they are more than welcome to do so.

The problem is that Redbox has such small margins on their rentals that even buying 15 DVDs at full price for each machine would mean that they would be losing money.

This is not a sound business model. It is one that has to change. Redbox knows it but they want to blame the studios when they are forced to raise their prices.

I think they are saying that RB was getting buy backs for all their movies that didn’t sell or there were too many.

The indies and BBs of the world were not.