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Hastings CEO: Redbox Must Compromise

sanderNEWIRHollywood industry journal The Wrap, hot on the heels of an editorial from Redbox’s Mitch Lowe, has published a counterpoint essay by Hastings Entertainment CEO John Marmaduke. In his remarks, Marmaduke says he understands Lowe’s enthusiasm for Redbox’s pricing model, but asserts that drastic changes must be made to “prevent the devaluation of new entertainment products”.

Discussing Redbox’s business model, Marmaduke had the following to say:

“We simply cannot give away products that cost hundred of millions of dollars to produce or else we will end up just like the newspaper industry, which now has an unsustainable business model. Once the main product of an industry is artificially devalued, the negative economic impacts will ripple throughout the industry, impacting the workers and businesses that rely on the overall industry. Let’s not create a modern-day ‘Goose that laid the golden egg’ parable.”

Marmaduke goes on to propose a solution that will allow Redbox to maintain its current $1 per night rental model: the company needs to integrate itself into the established industry model for release windows, rather than renting films for a dollar as soon as they are available. In short, Marmaduke wants Redbox to acquiesce to the delayed release windows several major studios have demanded.

Marmaduke concludes his remarks with a dire prediction of what will happen to the industry should Redbox fail to come to terms with the studios:

“Mitch Lowe’s approach to $1 DVD rentals might make him a lot of money in the near term, but it will destroy the entertainment business and result in thousands of lost jobs in the months ahead. There is a way to prevent that from happening if Redbox would try to work with the entertainment industry instead of against it.”

Can you feel the tension, Insiders? Passions on both sides of this battle are running high and getting higher, and there are a lot of people with a LOT of money on the line. Is Marmaduke a voice of reason, trying to shout above the din? If so, will he be heard?

[via The Wrap]

51 Responses to “Hastings CEO: Redbox Must Compromise”

  1. Visitor [Join Now]
    FalconFour [visitor]

    I… actually… have to agree here. Redbox would be no worse off by charging a different price for new release movies and it could only help them and the industry as a whole. Although, I do rather think that Netflix was the pioneer in wholly devaluing DVDs (small monthly fee = as many movies as you can return in a month), I think they could both stand to value new releases just a little differently.

    People are always hot on the newest, latest, greatest, so it just makes sense to segment new releases in a different “class” – be it price (preferably) or in release time. Price just makes the most sense, since many people – at least myself – would never notice the difference between an on-time and delayed release at Redbox; what’s there is there when it’s there and that’s all I care (that’s a mouthful).

    So if Redbox struck a deal to be charged more per disc on new releases, and passed it along as higher new release prices, I’d be happy, and the studios would be happy. Make sense?

    • Visitor [Join Now]
      Paul [visitor]

      But it wouldn’t actually solve the “problem” the movie studios are complaining about. Hastings seems to use multiple arguments that are commonly used against the movie industry and twisting them around. The industry is trying to keep prices artificially higher, not the other way around as he claims.

      “We simply cannot give away products that cost hundred of millions of dollars to produce or else we will end up just like the newspaper industry, which now has an unsustainable business model.”

      Newspapers don’t have an unsustainable business model because they are giving away the news. News is going more towards free because technology makes it possible and there are faster and better ways to deliver news than printing it on paper. The news companies have to adapt to the changing market.

      Same thing for movies, there are faster and easier ways to distribute movies so the price consumers are willing to pay is coming down. They are trying to cling onto an obsolete business model instead of adapting to the changing market. Hastings uses an example of clinging to the old ways in this statement talking about how Redbox needs to integrate itself into the established industry model for release windows. Technology makes instant satisfaction possible and that is what people want more and more, not the industry’s release windows that delay this and artificially keep prices high.

  2. Visitor [Join Now]
    Curtis Taylor [visitor]

    Rebox could charge $2.00 a rental this would satisfy studios because it would show redbox willing to compromise and Customers would not be unhappy either. Redbox could blame the price change on the economy. If Redbox charges too much money they will kill their business because people will not rent from them.

    • Visitor [Join Now]
      slidecage [visitor]

      i know if redbox jacks up the prices to 2.00 per movie noone that i know will rent out of redboxes… you can get BuY 1 get 1 free coupons very easy for free off the net… local mom and pop stores or even family video rents movies for 2.79 per night or 3.00 after tax..

      so i can take these coupons in and get 2 movies for 3.00 without a credit card..

      redbox would want 4.28 after tax with a credit card

      sorry but that would just kill redbox in this market … right now redbox is killing everyone else cause of their low price locally but jack up their price and bye bye redbox

      • Member [Join Now]
        Mark [rb123456789]

        90% of the public doesn’t know where to get b1g1 coupons, doesn’t want to spend the time required to use coupons, or has no convenient store nearby which will accept them.

        Redbox would for most people still be cheaper. And more convenient for the majority of people (which is important, as the time and gas cost to rent and return figures into the value equation.

        And coupons such as the b1g1 ones are a response to competitive conditions, most notably Redbox. If Redbox pricing rises then coupons will become scarcer, or be b2g1, or something of the sort.

        So since Redbox rentals will decrease if the price rises (there is always an inverse relationship between sales and price), IMO the decrease is very unlikely to be enough to kill Redbox. Of course it all depends on how Redbox handles it.

        • Visitor [Join Now]
          T-dog [visitor]

          A buck a day is the MAIN selling point. That’s why there is a “Dollar Menu” at every fast food joint. They should be trying to get more butts in theater seats and get this 3D standard ironed out quickly. I went to see “UP” in the the theater just because it was in 3D. The Movie Industry needs to adapt to the 21st century. Grasp 3D and make the theater going experience more rewarding. I LOVE Imax- They don’t over charge for the food and drink, plus, it provides an experience I can’t get at home! Imax has big plans for expanding and ALL Pixar future releases will be offered in 3D. Personally, I can Bit-torrent ANY movie I want-for FREE. I’ll pay for it as long as it stays a buck!

  3. Visitor [Join Now]
    MrSticks [visitor]

    I have to disagree with the logic that these movie studios are trying to convey. Lets take the blockbuster stores and compare them to redbox. Blockbuster charges may charge between three to five dollars for a new release and allow you to hold it for up to five days, valuing the rental between sixty cents to a dollar per day, plus tax. Redbox is getting a dollar per night from the get go, and most people probably return it faster because they are watching and returning the video to keep their cost low. Why force one company to change when there are several others that are doing more harm than good for the industry.

    Guess it another one of those witch hunts on the good from the bad and the ugly.

  4. Visitor [Join Now]
    dillyclm [visitor]

    Raising the price would only solve the “revenue sharing” dilemma of this equation, no the “sell thru” side. More people would probably buy more DVD’s if they agreed on the “release window” model, simply because we’ve become a right now gratification society. But that would only increase bootlegging, which is another issue for the industry. I think that with the $1 rentals more people have refrained from buying pirated copies of movies when they can rent it for a buck. For this, the studios should be thankful to Redbox. This is just another sentiment that needs to be considered in this quagmire.

  5. Administrator
    Michael [administrator]

    I totally disagree with the premise that is made in the article, of course, as it basically advocates price-fixing and unfair practices being imposed on Redbox by the studios. And you wonder why Redbox is suing these studios?

    If the studios were smart, they would create a new “window” with VOD, which is something that is being tested right now. That is the kind of innovation and smart thinking that will save the studios, not by trying to make Redbox feel bad by making a profit on a lower price point. Is it really Redbox’s responsibility to make sure its competitors stay in business? Seriously, that is what the article is saying.

    And, it gets compared to the newspaper industry? The newspaper industry wasn’t “artificially devalued”, it was replaced. The music industry has been “replaced” with a new industry, a new “version” if you will. The movie industry is heading to a new version, too. This is all based on technology, and it is inevitable.

    • Visitor [Join Now]
      c2nah777 [visitor]

      Agree completely. Competition and technology improvements will weed out those who stubbornly cling to outdated practices and business models. When someone builds a better mousetrap, the cheese gets moved. It’s evolution.

      • Visitor [Join Now]
        Wendy [visitor]
        I work for VBG. To find out why this is important, click here.

        What is so technological about a vending machine that spits out movies? It sounds extremely low tech to me. This is no more technological then a pop or candy machine.

        • Visitor [Join Now]
          rumblefish [visitor]

          Yet it has completely turned a group of well-educated, seasoned Hollywood executives into a sorry excuse for businessmen….shameful.

          • Visitor [Join Now]
            igloo [visitor]
            I work for VBG. To find out why this is important, click here.

            How is that I thought redbox was suing them. They were the ones complaining. Sounds to me like the Hollywood execs know excactly what they are doing.

        • Administrator
          Michael [administrator]

          This is a joke, right?

          What candy and pop machines take returns? What candy and pop machines can be controlled from the internet? What candy and pop machines let you buy your food and return it at another machine?

          It’s not that the kiosk itself is so amazing or innovative, it is all of the different parts of the Redbox business model wrapped up together. Even other DVD kiosk companies haven’t quite figured out the rent-from-one return-to-another deal, even though technologically it is not that complicated.

          Redbox is certainly more than just a glorified pop machine, and quite a bit more at that. Sounds to me that a lot of the detractors here are just jealous they didn’t make it happen first.

  6. Visitor [Join Now]
    joey [visitor]
    I work for VBG. To find out why this is important, click here.

    I completely disagree that this is price fixing. As it’s been said redbox can charge whatever they like. But if it will be that price of $1 then they will have to move down the distribution channel so the entire industry works not just redbox’s short term success with a model that’s not sustainable.

    There is an attempt to try and find a place in this industry for redbox ( kind of like $1 movie theatres ). What red box has tried to do is force it’s way into the business model that is the video industry and try and make immediate short term gains at the expense of every other distribution channel out there along with the studios. This is not good for the industry whatsoever, it devalues the very product that drives the industry. In the end it will trickle back down to the consumers after the industry has been decimated because of redbox. It allready has with video store after video store closing effecting local economies, jobs , and options for consumers, along with the quality of films being made.

    Everyone on this site keeps complaining about how the quality of films being released out there are getting worse and worse. This will be a trend that can only continue if Redbox is allowed to continue devaluing packaged media. Sure everyone is excited that they are renting movies out there for a dollar, what I’m saying is if redbox keeps this model going in the way it’s going the movies you as consumers will be watching are going to catch up to that price and only be worth that dollar. It allready has been.

    Micheal you say this is all based on technology. What is so technological about a vending machine? These same machines were around in the 90’s and didn’t work then. There is nothing technological about a vending machine. It’s only claim is cheap and fast. What these things are doing is replacing video stores and options out there, eliminating selection for customers, Store fronts that carry 1000’s of titles, actual people you can talk to and get opinions about a movie and hear your complaints and react to them, and finally desimatingthe worth of packaged media. Replacing it with a machine that has a 100 or so titles and an 800 phone # that will put you on hold. and flooding the market with immediate gratification on new releases.

    You continually tout the red box as a positive thing in this industry. It is not because it has been unwilling to find a solution that helps the industry flourish instead of flounder.
    And your Idea of creating a seperate VOD window is not innovative thinking it has also been tried numerous times and is once agin being tested by Warner. The reason this does not work is because it has to big of a negative effect on the rest of the business model that is the video industry. You see it is in EVERYBODYs interest for this model to work. Unlike redbox’s who’s sole goal is to show growth to get investment for more growth until the house of cards colapses.

    • Administrator
      Michael [administrator]

      Your comparison of Redbox to $1 movie theaters needs further discussion.

      $1 movie theaters are only part of your “window” system because the value of movies go down as they get farther from their release date. The $1 theaters don’t get new reels, they just buy old ones from other theaters who are ending their runs. Sounds a lot like the used DVD market, eh? I am guessing you have complained often against this ridiculous devaluation of the movie theater industry by these cheap $1 theater owners, right?

      Like I have said before, if the movie industry simply raises the prices of DVDs on release date, and keeps them high for 4-6 weeks, then there is a pretty good chance Redbox will put themselves inside the “window” you are talking about. There is also a good chance they would buy used DVDs and rent those, though, as that is what I would do. Uh-oh, that would further devalue the industry, wouldn’t it?

      The best way for studios to overcome this issue is to change the time/place and/or format. They have been trying that with blu-ray, which are essentially higher priced DVDs during a new release window. It hasn’t worked too well because it adds little quality to the average consumer at a significantly higher price.

      For me, I only watch blu-ray unless I have no other choice, which keeps me at Netflix instead of Redbox for most movies. But, I have a 60″ TV and high-quality AV equipment, and for me the difference is worth it.

      Do I buy blu-ray, though? No, not really. Rental simply makes more sense except for certain Pixar, Disney and Dreamworks Animation films. Again, quality films get me to buy.

      What else can they do? Like I said before, the answer is VOD.

      VOD is a huge opportunity for movie studios to fix their problem. Now, you say they have tried before and haven’t been able to make it happen. You know exactly why they have failed there, don’t you? It’s called greed.

      VOD would work great at a $2-3 price point, but not $5-6. At that price I can wait and use Netflix or Redbox. At $2-$3, the convenience starts to factor in and reels me in. And, with significantly reduced distribution costs, the studios make more money.

      Just look at iTunes. Apple, as the distributor, makes about 30 cents on their 99 cent songs, with the rest going to the labels. 30% is great for Apple, and 70% is great for the label.

      Now, lets turn this to movie studios. If you charge $2.49 for a VOD rental, you can assume similar profit margins, but with ZERO (or near zero) costs to the studios. Each new rental is just pure profit to the studios. And, with the added convenience, more people take that option.

      You may complain that hurts the “little guy”, and people lose jobs, but that is simply the nature of internet distribution. It is the future, and it can’t be stopped. New jobs will be created, though, and things will work out.

      This is the way for the studios to “beat” Redbox at their own game, and is the smartest move they can make.

    • Member [Join Now]

      I think Joey is right Red Box is bad. Since Red Box came along my movie rentals have gone up probably 1000% plus the occasional free movie and my purchases have gone up only 500% it is so bad I should start going back to movie gallery and renting a movie for $5 when I want to watch it and then return it the next day since I am finished with it and be content that my $4 loss is helping the movie industry keep the prices high. After I accept that $4 loss I will wait a bit longer to make that money back and then go buy the movie only if I liked it though for probably $20. Joey you have opened my eyes! How could I have ever thought renting new movies for $1 and then buying it if I liked it would keep food on movie producers tables and continue the production of over budgeted movies. And I’m still mad that Red Box is making the industry produce more and more garbage every year, it was probably to make Indie movies more popular since they can produce some really fine gems on a low budget. And who wants or needs Instant gratification from rental media anymore. Let them put a window on Red Box so more people will have to make the choice of buying a new dvd for $25 or Pirate it if we want to see it now. Me personally I want to waste my meager college student funds on over priced new release dvd media. College students can live off ramen and not become malnourished right? But wait I’m against instant gratification so I guess I don’t need to buy that dvd now I can wait till Wal-mart screws over the industry with their $5 dvd section. I guess the moral of the story is Spend Spend Spend, never look for the better deal, and don’t desire new movies but if you do make sure you look for the most expensive and see how much they give back to the studios because they need to be your main focus when going to see a movie and especially when renting or buying dvds.
      Remember Red Box is bad, your (The consumers) opinions don’t matter, brick and mortar rental stores are better because you can’t spontaneously rent movies in the middle of the night, dvd media is the only way to go, Big studios can’t make good movies if you rent from Red Box, they can’t make good movies without $200 million even though Indie artists can with $20 thousand, I think there might be something about vending machines being non technical even though Red Box has a nice computer system and software running it remember it just spits stuff out like a soda machine, and since Red Box is such an evil company they are probably funding terrorism.

      I know you didn’t make all these arguments Joey, but I decided to add in the logical progressions to warn the Red Box customers.

      • Visitor [Join Now]
        igloo [visitor]
        I work for VBG. To find out why this is important, click here.

        Shane…. you can change your name all you want but you still show up orange when you make a post. Just like Michael is red so why not just put your name with your post instead of pretending your just joe consumer. (vested interest)

        • Shane Smith [shane9]

          Wrong on both counts, igloo. I ONLY post stories and comments under my own name. Can you say the same? Michael’s the admin of this site, which is why he shows up in red, I believe.

          As for my alleged vested interest, I own no Coinstar stock, and do not receive any compensation from Redbox. I get paid by Michael to write for this site, whether it’s good or bad news for Redbox or just my opinion. That’s it.

        • Administrator
          Michael [administrator]

          Comments with a gold background are from Gold Members. It’s kind of silly for you to make accusations against Shane. Could it be because you know your arguments are flawed and don’t want to actually back them up with hard facts?

        • Member [Join Now]

          Actually I am just a Joe consumer, my name is David, and I am a full time student at a Bible college in MO. I don’t get paid to voice my opinions about Red Box and yet that doesn’t stop me from expressing them about the company. I have been using Red Box almost exclusively for a little over a year now, and like I stated earlier I have increased the amount of movies I rent and buy since starting to use Red Box. I like being able to rent new movies that are blockbusters as well as unknown gems and if I like it I’ll go buy it. That’s why I like Red Box, that’s why I use it, and that’s why I express my opinions about it.

      • Member [Join Now]

        LOL! Great one!

  7. Visitor [Join Now]
    Joey [visitor]
    I work for VBG. To find out why this is important, click here.

    This was taken from the editor and chief of Video Business Mag.

    Marmaduke in favor of kiosk window
    October 8, 2009 Hastings chief John Marmaduke makes one of the most clear and well-reasoned arguments against Redbox and $1 per night DVD rentals that I’ve seen, in a blog post on The Wrap. Marmaduke writes in response to the forum The Wrap gave Redbox’s Mitch Lowe earlier in the week.

    The crux of the matter, from Marmaduke: “… if new releases would be available for $1 rental, consumers would be encouraged to forgo watching a movie in the theaters and instead wait a few months. Consumers would be discouraged from renting from bricks-and-mortar video stores — putting these stores out of business and reducing access to the thousands of movies that can’t fit into a kiosk. Consumers would be discouraged from watching the movie on pay TV or streaming to their computer for $3.99 when the movie can be rented for a single dollar. Consumers might not buy a DVD if they know they can rent it occasionally for just $1. And the examples go on and on. If movies are devalued in this way, those who work in the movie industry will be directly harmed. Reduced industry revenues will mean that fewer movies are produced — directly reducing the number of jobs available to people who work both in front of and behind the cameras.”

    • Member [Join Now]
      HailDarkLord [haildarklord]

      The easy way to answer this is that I dont go to see movies at all. It’s old and not worth the value. I stopped renting movies at video shops as well because I wasn’t going to waste money watching a $5 rental when I could just wait for the neighbor or co-worker to buy it and borrow it. Since RedBox came out, I have rented over 20 rentals a month and bought 2 per year. This is amazing since I was spending zero dollars before and now for the $20 on rentals and $20 on purchases, I have actually put my part back in to the industry. If RedBox does stop new releases or date them later, I will have already seen them for free. Thus spend NOTHING ever! I know that even if 10% of US sales mirror my actions, the industry is in deep pooh pooh without Redbox. I’m just an average guy on an average wage and HATE that a movie in Theater or DVD new release costs men about $20 which means I can see or buy 1 time a year. At that rate, why care or watch at all. I love Redbox. They will save the failing industry, not harm it.

  8. Visitor [Join Now]
    mike [visitor]

    “If movies are devalued in this way, those who work in the movie industry will be directly harmed. Reduced industry revenues will mean that fewer movies are produced — directly reducing the number of jobs available to people who work both in front of and behind the cameras.”

    I’m sorry but I still can not feel any sympathy for the movie industry while they pay actors and actresses from 100k to 2-5 million per film. That’s grossly over paid. It’s not like they’re saving the world or curing diseases, all they’re doing is acting in films. Yes some of them donate a good amount to charity and take up causes, but others think they’re better than everybody else and think they deserve to be treated like royalty. If the movie studios stopping paying celebrity actors more than a regular person would make in their life time and there was still problems with the payout, it’d make more sense that Redbox’s model isn’t working. But instead the Movie Studios come out and whine that they’re going to get run out of business while meanwhile paying George Clooney and Julia Roberts 10 Million each to star in film. Why does the Consumer have to be squeezed as much as he or she can in order for the film industry to survive and cameramen to get paid? Like others have said on here “The film industry should adapt to survive”

    And Blockbuster Online and netflix have 3 at a time plans for like 16.99(around there) a month. If you get from 15-20 dvds out of it that’s almost a dollar rental per dvd. I didn’t hear Universal or any other company whining about that.

    • Visitor [Join Now]
      igloo [visitor]
      I work for VBG. To find out why this is important, click here.

      How does a whole distribution chain get turned into actors. Do you not get what this is about?
      And as far as your piece about netflix and blockbuster that’s a 16.99 dollar transaction per person not a 1 dollar transaction per person huge disparity and if they get 15-20 movies a month who the hell does that?
      I don’t think you have a clue in your statement here!

      • Visitor [Join Now]
        acdahl [visitor]

        Missing the point a little here. Yes, it is a $1 transaction, for one night. If it is returned after 2 days, it is a $2 transaction. That movie is then available to more consumers quickly. While at brick and mortar stores, they charge ~$4-5 for roughly a week. This actually works ou to less than $1 a day. Which is devalued here? It actually costs less per day to rent at a BlockBuster, than at Redbox.

        As far as that number of movies a month from Netflix, I routinely get 10-15 discs a month from Netflix at the 2 at a time plan. I don’t watch them all, but someone in my family does. I watch things that my wife or child doesn’t want to see. My wife likes things that I don’t. Our daughter enjoys Dora and Thomas, which my wife and I don’t watch. We keep the disc for a day or two and drop it back in the mail. Everybody watches something once a week which works out to about 12 a month.

        Give me a bigger family or 3 at a time and I hit the numbers mentioned easily. And my bet is that I am not the only one with these viewing habits.

        The best argument I have heard concerns the library of older films. That is definitely lost with Redbox, although they do toss in some older films at some of the kiosks. This is nicely picked up by Netflix at a much better value than a brick and mortar store. Whether you like it or not, the days of BlockBusters on every corner is over and they will likely become more scarce over time. This model is a dinosaur and will never be revived. With streaming and DVR/Tivo and on Demand, the need to have a library of videos has dropped dramatically, which has impacted sales of DVD’s.

        Redbox may have hastened this a bit, but was ultimately inevitable. Truth be told, the current economy likely has a much larger effect than any one distribution method.

        What some of you don’t realize is that if you kill Redbox, it won’t change the amount of money being spent on movies and will likely decrease it.

        Redbox is not the enemy, it is mearly a cog in a broken machine. Take the cog out and the machine is still broken, but the workaround is gone.

        • Member [Join Now]

          Well said!!!

        • Visitor [Join Now]
          Jody [visitor]

          You make perfect sense. Especially this part:
          ‘What some of you don’t realize is that if you kill Redbox, it won’t change the amount of money being spent on movies and will likely decrease it’……….now who doesnt UNDERSTAND that??

      • Member [Join Now]

        You asked: Who the hell gets 15-20 movies a month?

        We get 16 movies a month from netflix making our average cost per
        movie about 90 cents. We use netflix and redbox, but would never go
        back to using BB.

        • Visitor [Join Now]
          igloo [visitor]
          I work for VBG. To find out why this is important, click here.

          That makes 2 of you. Maybe you should go out and find a job or get a life

          • Visitor [Join Now]
            Jody [visitor]

            a lot of people i know also rent that many a month. why the need for the immature comments? did you have a bad day?

          • Member [Join Now]

            Maybe you should go out and get a brain. I have a good job as a database administrator and I have a life, being happily married. Immature comments
            just invalidates your argument. Jody is right, I know a lot of people who use their netflix membership to get a lot of movies monthly.

        • Visitor [Join Now]
          John Small [visitor]

          JFTR, Netflix has admitted that they lose money when someone rents that many movies in a month.

        • Visitor [Join Now]
          slidecage [visitor]

          one time we got 24 movies in one month from netflix. then they started to throttle the hell out of us.. the next month we got 8 and not a single new release.

          3 at a time plan

      • Visitor [Join Now]
        Mike [visitor]

        The whole distribution chain to actor thing was the Studios paying high class actors millions of dollars to star in the film and then at the same time whine about redbox not charging enough for a rental. My point was rental prices shouldn’t increase so the movie studios plan works, the studios should learn not to pay actors so much money so they still have a profit to pay the crew while not ripping off the consumer. Just cause you don’t want to figure it out doesn’t mean I have a clue. Redbox’s plan might need some adjusting, but so does the movie studios. And I doubt I’m the only person in the world who tries to watch as many dvds as they can in a month when I have Netflix to get they’re money’s worth, so don’t act so high and mighty.

  9. Visitor [Join Now]
    Jonathan [visitor]

    This is bull.
    What’s the difference between RedBox 5 day rental at $5 and Blockbuster 5 day rental. In fact, if I rent a movie from BB I usually keep it longer than 5 days anyway. So, let’s see…
    BB – 10 days = $5
    RedBox – 10 days = $10.

    BB should be the target.

  10. Member [Join Now]

    The studios are money-grubbing idots with their heads in the sand. I don’t know if I’m atypical, but I gave up on Netflix a couple of years ago when my deliveries started to become less and less frequent, meaning each DVD cost me more for my $9.95 fee. When Hollywood Video in my neighborhood closed its doors, I refused to pay the ridiculous “three day rental” fee at Blockbuster for a movie I needed for one evening. So, for more than two years, I didn’t rent a single DVD – I waited for the movie to come to HBO. Since the advent of Redbox, I’ve averaged 2-3 DVD rentals a month for the past year. Would that be the case if I was stuck with Blockbuster? No way – I don’t even have a BB account.

    As for hurting DVD sales, I purchase maybe 2-3 DVDs per year at most. Unless it’s a concert video I’ll watch over and over, I’m not going to buy a movie to watch it once. It has to be something REALLY exciting. Now that I have Blu-Ray, I’m waiting for some great concert videos to be released and I WILL buy those, but most likely not rent them. I already have a few Blu-Ray concert discs. I might even buy a terrific Blu-Ray movie such as Star Trek (which I saw in IMAX) – but probably not.

    If Redbox has drawn back renters like me who gave up renting a long time ago, the studios should be happy. That’s a niche market they weren’t reaching with either the other rental companies OR DVD sales. If they want to continue being stupid, then make Redbox less affordable and I’ll go back to HBO. If the profit margin doesn’t work for them, then be reasonable (I’d pay $1.50 for a DVD and even $2 for a BD) but don’t just be stupid and withhold your product from millions who likely wouldn’t rent at $4.99.

    • Visitor [Join Now]
      Joey [visitor]
      I work for VBG. To find out why this is important, click here.

      Let me ask you this then. Would you still rent your 2-3 rentals a month if the titles were delayed by 30 days? I’m guessing the way you explained that you rent that you would. So win.. win… Protect sell thru plus gain extra renters with the extra window.

      • Member [Join Now]

        Yes I would – I’m not the kind of renter who runs out the first day of release – I rent when it’s convenient for my busy schedule. If it’s 30 days after release, it’s fine – works for me.

        • Visitor [Join Now]
          Joey [visitor]
          I work for VBG. To find out why this is important, click here.

          That’s what the studios are saying it is a middle ground where they can protect the value and still give people $1 rentals.

          • Member [Join Now]

            If they truly will do that, I have no issue with it. So far it seems that neither side wants to give. I agree, there has to be compromise so both sides win, and if anyone absolutely HAS to rent on the first day of release, let them pay the extra. That’s their prerogative. It seems that this could be easily resolved if calm heads prevail.

  11. Visitor [Join Now]
    redboxroger [visitor]

    Redbox makes a profit renting for a dollar a night. Hastings charges three to four dollars for four to five nights. Of course they hope you will return them as soon as you watch them. If everybody who rented from Hastings kept their rentals for the full term of the rental Hastings would still make money. The only time these rental places lose money on their movies is when they buy crap nobody will rent. If redbox raises the rental rates I’ll just drop by the $1.50 movie theater to watch movies and skip redbox.

  12. Visitor [Join Now]
    redboxroger [visitor]

    The studios make their money off the top. They sell the disks to the wholesalers who sell to the rental companies and retail stores and this is after the studios made their money at the boxoffice showing them in theaters. They did not like the rental business when it first started because they could not control it. I don’t feel sorry for the poor studios.

  13. Member [Join Now]
    GogetaSS4 [gogetass4]

    I rather enjoy the $1 price point of Redbox as it’s something I can afford on a minimum wage job income. I usually only watch it once and then return it. However if I really enjoy a movie I got out and buy it! But usually at less than retail, since in my opinion retail is far too high.

  14. Visitor [Join Now]
    Daniel [visitor]

    Why does a movie cost so much to produce? are actors really worth the exorbitant fees they get? why isnt there any cost cutting there?

  15. Visitor [Join Now]
    John [visitor]

    I used redbox for about a year but i switchede to movie gallery they have a deal for $40 a month you can rent all you want games included.

    • Visitor [Join Now]
      Joe Schmuck [visitor]

      Better enjoy it while you can. Rumor is that Movie Gallery will be filing Bankruptcy for the second time in the last 2 1/2 years, within a couple of weeks.