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In a turn of events that would have been unthinkable just a few years ago, kiosk rentals have surpassed in-store video rentals for the first time. The NPD Group is reporting that Netflix and other subscription services now command 41% of the rental market, Redbox and other kiosk operators comprise 31% and traditional video stores have sunk to 27%.

NPD analyst Russ Crupnick says the momentum shift away from video stores will likely continue:

“The rental landscape for DVDs and BDs continues to shift, and consumers are obviously responding positively to the perceived value and convenience of kiosks . . . Traditional video retailers will no doubt experience even more competition in the coming year, as kiosks appear more frequently in grocery store chains, mass merchandisers and quick-serve restaurants, and as competition intensifies from an assortment of on-demand rental offerings.”

While not surprising considering the recent fortunes of Blockbuster, Hollywood Video and other rental stores, this news nonetheless represents a major shift in an industry that was dominated by the brick-and-mortar model not so very long ago.

It seems very likely that video stores will never recover their spot in the rental hierarchy—the next battle will be over the vacated video store market share. If Redbox comes up with a compelling digital model that will allow it to compete with Netflix, etc., will it see its market share continue to rise? With the market shifting in such a dramatic way in just a few years, how will things shape up in the near future?

(via Home Media Magazine)

13 Responses to “Report: Kiosks Rental Numbers Surpass Video Stores”

  1. Visitor [Join Now]
    John Small [visitor]

    and yet traditional rental stills brings in far more money than kiosks. Kiosks turn dollars into dimes. Is there any wonder why real business people are working to fix this dog?

  2. Visitor [Join Now]
    firstlawofnature [visitor]

    Far more money and far more overhead. Kiosks can make money at much lower activity levels than stores obviously.

    • Visitor [Join Now]
      John Small [visitor]

      Not for long. 60-90 day delays just around the corner. Increased costs, decreased revenues, house of cards collapsing. Get you while you still have a profit.

  3. Member [Join Now]

    Also, kiosks are rapidly becoming the only option. There is only one local chain and no national chains left in this city.

  4. Member [Join Now]
    Nick [thouartsimple]

    So be it, I like both Netflix and Redbox… I don’t use old style video rental stores and I haven’t for years. Honestly, I’m surprised that they’ve managed to last this long.

  5. Visitor [Join Now]
    tim [visitor]

    o.k. I read the message. don’t mean to be an as***le, but when do you get free redbox codes?