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The $1 per night DVD rental popularized by Redbox and imitated by others has been called many things by many people. Brilliant, unsustainable, consumer-friendly and devaluing have all been used to describe it.

Redbox has tested higher pricing in limited markets, but the buck-a-night price point has generally stayed put over the years. Now NCR-owned Redbox rival Blockbuster Express plans to roll out “premium” pricing by way of a new deal with Universal.

The L.A. Times is reporting that under the terms of the new deal, “Universal and NCR have agreed to test charging more for certain titles in a small number of kiosks during the first 28 days. Under the tests, NCR is expected to charge a higher price, possibly $3, for the first night and a lower price, such as $2, for subsequent nights. Then, after 28 days, those discs will revert to the standard $1-per-night price.”

Universal Home Entertainment President Craig Kornblau offered the following on the new deal:

“Our agreement to test premium day-and-date offers and new DVD sales will help us identify new outlets for our movies while giving our customers the flexibility and choice they want in their entertainment purchases,”

Are consumers going to pay double or triple the usual kiosk rate to rent a Universal title the day it comes out? Is the increased price worth it to rent a movie four weeks earlier? Tell us what you think in the comments.

(via The L.A. Times)

72 Responses to “Universal, NCR Sign Deal to Test Premium Pricing”

  1. Visitor [Join Now]
    Grenadier [visitor]

    Overcharging for rentals…..isn’t that why Blockbuster is in bankruptcy in the first place?

  2. Visitor [Join Now]
    rb [visitor]

    As a Redbox customer, either I don’t notice/care anymore about having to wait the 28 days for a new release, or I’ve been conditioned not to care–because either way I just don’t notice or care about the 28 day delays by the studios. Always something to rent during the 28 day delays, so no biggy for me. Think if BBExpress increases to $3 for a new release, they are sealing their coffin before they even got a chance to breath/live/exist in a competitive way! If they are going to $3 for new releases, think BBExpress should immediately halt any plans of adding more kiosks because the $3 price point will doom them!

    • Visitor [Join Now]
      Matt [visitor]

      Totally agree!!!

      To me ‘Price’ comes first any time. It is good financial sense to wait even months to make a ‘purchase’ with a huge depreciation. That is why I can wait to watch a movie, except Sci-Fi movies, when they are $1 instead of the normal movie ticket price of $10.

      I was urging people to give BBE a chance. If BBE raises their price I will not rent from them. Since Redbox only gives discount codes to cellphone user with texting, I guess I need to start to check out Netflix pricing.

  3. Visitor [Join Now]
    tinybrat [visitor]

    My area here in Cali went back to $1 at redbox. I think redbox knew $1 was the best price point regardless of delay windows. I won’t pay double or triple just to get univesal movies on the first day. If I wanted that, I’d just use the other video stores, duh.

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

    Brave and smart move by NCR. People will still rent the movie and NCR will make more money.

    Redbox is losing out on revenue by keeping their prices artificially low. This may be their doom if they do not change sooner rather than later.

    • Visitor [Join Now]
      Sgt Carter [visitor]

      What a surprise! Little John thinks a higher price is good! Seriously John, I think most people will wait out the 30 days. That would my plan if I used NCR. I don’t use NCR – no selection – too hard to get new releases.

      • Visitor [Join Now]
        John Small [visitor]

        I think you are wrong. Most people look for convenience over pricing.

        • Visitor [Join Now]
          CJ [visitor]

          Good point John. That is why I will occasionally pay even more to rent through Amazon and stream on my Roku. By the time I remember to drop off the redbox dvd, I’ve already spent the same amount!

        • Visitor [Join Now]
          Firstlawofnature [visitor]

          Beware sentences that start with ‘most people’. Do you want to argue percentages? Do you know 51% prefer convenience over price (that’s before considering what’s convenient about rdebox)? How should we judge what consumers prefer?

          You characterization of ncr as brave and redbox as I’m sure some negative word is stupid. It is a certainty that ncr would trade places with redbox on the kiosk business in a second if it could.

          • Visitor [Join Now]
            John Small [visitor]

            Studies done over the last 25 years for the entertainment industry showed convenience/location ranking as #1 or #2 amongst customers reasons for choosing their rental location.

            Price usually placed in 6th or 7th place.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            LOL. Kiosks in mass are a relatively new phenomenon. Your studies clearly are dated. Further I’d say mcdonalds, wal-mart, walgreens, kroger and CVS are pretty convenient locations wouldn’t you say?

          • Visitor [Join Now]
            John Small [visitor]

            I did not argue over the convenience of Redbox. In fact I believe that convenience factor is the major reason for their success in capturing market share. Price has little to do with it.

          • Visitor [Join Now]
            The Situation [visitor]

            Well John, if “Price has little to do with it” then why do you dislike redbox so much, as your main point of your hatred is that you want them to increase prices?

            I’d like a real answer, and not one of your many “That is not what I said” answers. Your statements are so weak you have to constantly act like they can mean two different things so you don’t look wrong all the time.

          • Visitor [Join Now]
            John Small [visitor]

            I dislike the Redbox pricing scheme because it is not a sustainable business model.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            I’m sure some music exec who’s out of a job now labeled apple’s $.99 pricing as not sustainable. It is clear that ind vid stores and the VBG are pressured by Redbox and Netflix. That’s why you come up with all these illogical arguments all the time.

            It’s funny to see you trip up sometimes with your pretzel logic. Pricing has little to do with it and Redbox beginning to squeeze the consumer are classics. ‘I did not have sexual relations with that women.’

          • Visitor [Join Now]
            John Small [visitor]

            If you are trying to compare Redbox to iTunes then you are out to lunch.

          • Visitor [Join Now]
            firstlawofnature [visitor]

            LOL. What do you know about sustainability anyway…you still can’t figure out that redbox makes a profit.

            The notion that redbox can’t sustain $1 is as silly as the notion that apple can’t sustain $.99.

          • Visitor [Join Now]
            John Small [visitor]

            If only you understand the nature of the business FLON. Accounting for costs and depreciation is very flexible when you are talking about DVDs. It is easy to turn a loss into a profit if you don’t mind deferring things down the road. BBI used to do it all the time.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            I’ve covered this before. The turnover of discs is too rapid so all the costs are washed through in less than a year. All accounting convention be damned the company will have generated almost $100,000,000 in cash for 2010.

            Perhaps the next VBG convention should host a seminar on reading financial statements. You got to know your enemy to beat ’em Patton. Pretending $1 pricing is not sustainable is not a strategy for ind vid stores.

          • Visitor [Join Now]
            John Small [visitor]

            Oh FLON, resorting to insults and insinuations yet again.

            You have only proven that you don’t know how the accounting works. I know you want this to be magical and everything but you will only end up losing your investment.

            You’ve been warned.

          • Visitor [Join Now]
            firstlawofnature [visitor]

            A warning from you is worth less than $1.

            I am certain I know the intricacies of accounting far better than you.

            $100,000,000 JS. That’s a lot of money for a business to generate. Think about it. Coinstar is going to generate ONE HUNDRED MILLION in cash this year. They will generate more next year and more the year after that. All your bullsh*t spin can’t cover up the fact that they generate lots of cash after all expenditures.

          • Visitor [Join Now]
            John Small [visitor]

            BBI was a cash machine on paper too.

          • Visitor [Join Now]
            firstlawofnature [visitor]

            Thanks for the in…I assume you mean BB produced paper profits and not real cash or did you mean that some time ago BB produced real cash profits but that it no longer does now?

            On the former I assume you can look at the financials and see that coinstar has generated real ‘money in the bank’ cash so far this year. Are you unable to see that?

          • Visitor [Join Now]
            John Small [visitor]

            I’m saying what you are seeing is not what you are seeing.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            Such a con artist. You won’t answer whether or not coinstar is generating cash. How typical of you.

            You are really not being fair to VBG members. At least be honest with yourself and acknowledge that your enemy is generating real cash. How can you hope to compete with redbox if you don’t even understand the nature of their financial performance?

          • Visitor [Join Now]
            John Small [visitor]

            Does cash flow through Coinstar? Yes.

            Do they get to keep all of that money? No.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            What a ridiculous statement. What you said would be true of any company. Based on your past behavior it’s clear you won’t acknowledge facts and numbers.

            Coinstar is on target to generate $100 million in cash after capital expenses in 2010.

          • Visitor [Join Now]
            John Small [visitor]

            Of course it is true for all companies. That’s why your statement is silly and irrelevant.

          • Visitor [Join Now]
            firstlawofnature [visitor]

            I will sponsor the VBG accounting 101 seminar next year.

          • Visitor [Join Now]
            John Small [visitor]

            I’m sure they will appreciate it. Why don’t you tell them rather than me?

        • Visitor [Join Now]
          Red Rover [visitor]

          Ahhh, how nice to have the battling weenies back in town!

    • Visitor [Join Now]
      Pootroot [visitor]

      Hey John, I just love it when you say something. I always need at least one good laugh a day. Keep up the good work Johnny boy.

  5. Visitor [Join Now]
    jericho [visitor]

    Let’s let the market decide what is successful. You can argue back and forth that this is a good idea or not, but ultimately the market will decide if this works. If it does, then studios finally have a reason to ask Redbox/BB Express to charge more. If not, then they should shut up and accept the $1 rental model.

  6. Member [Join Now]
    Bob [bvitry]

    As you know I have rented 660 plus from Red Box. And NO WAY will I change the way I rent DVD’s. I think RB is doing it right and there is no way RB can improve except one way and that is $1 streaming. I tried NEXFLIX on there free trial. RB got them beat hands down.

    Keep it up RED BOX your TOP DOG on my list

    Bob V.

  7. Visitor [Join Now]
    mjbxx [visitor]

    John Small. I’ve said it before and I say it again. YOU ARE AN IDIOT!!!

  8. Member [Join Now]
    starman15317

    I see that NCR is really trying to kill off their kiosks and Blockbuster, aren’t they? And that quote doesn’t make any sense.

    “…will help us identify new outlets for our movies while giving our customers the flexibility and choice they want in their entertainment purchases,”

    That makes no sense! He might as well just say the truth and not try to hide it with big words, the truth being “we want more money”

  9. Visitor [Join Now]
    Jack [visitor]

    Price may have been 6th or 7th place on the list many years ago when the only option to rent was to drive miles and miles out of your way to rent and then again to return. With at least 10 (probably a few more that I don’t know about) red boxes on my way home from work, price is NUMBER ONE on the list with me. It’s convenient no matter which route I take.

  10. Visitor [Join Now]
    Leyonce [visitor]

    “Is the increased price worth it to rent a movie four weeks earlier? ”

    NO!!

  11. Member [Join Now]
    ChrisChris [chrischris]

    The BB Kioshes in my area are completely out of my way because they are only located at one gas station branch. If by some chance I actually go by one and have a code for a free one or B1G1 I may decide to use it and deal with the issue of going out of my way to return it. Whereas RB has kioshes all over the place making it more convenient. Even if they don’t have a movie I want, I can drive a block or two and find one at another and it doesn’t matter if I have no code because its not out of the way. If BB would pick up the pace and get kioshes into more convenient areas I would probably use them more and it would just depend on which one has a movie I want to see in stock.

  12. Visitor [Join Now]
    Frank Huber [visitor]

    I’m used to waiting (once cable and now satellite subscriber) and there are plenty of not-so-new movies that we haven’t yet seen. So take your premium price and shove it!

  13. Member [Join Now]
    Casey4147 [casey4147]

    Nope, not interested. Premium price to me means you are delivering something demonstrably extra – $1.50 for a BluRay, the extra being HD. This weekend, I was out and decided to rent The Karate Kid. I had at least half a dozen options between where I was and home – the RedBox in the front of the store (rented out), Blockbuster (on the way home), the RedBox in the front of the grocery store I was going to pass (checked my iPhone, it was in stock when I started out but had been rented by the time I got there), two Blockbuster Express kiosks outside of gas stations depending on what route I was going to take home, the Redbox outside of the Walgreens three blocks away from my house, or the Family Video store two blocks away from my house. When I stopped at the grocery store and saw its Redbox was out, I checked my iPhone again and saw the Walgreens Redbox had it, so I rented it from there. Following my logic, convenience is top – I can check Redboxes on my iPhone, hell, I can rent from my iPhone but I was close enough to the machines that I didn’t bother – paired with price, $1 a night. You’ll note I skipped right past the Blockbuster store – not as convenient and expensive. Family Video was my last resort should I strike out everywhere else, and the two Blockbuster kiosks just aren’t as convenient for me. I would have had to go out of my way to get there and I would have had to use the web browser on my phone instead of the dedicated RedBox app, and that was just a hassle. I didn’t stray more than two blocks from a direct route home, so I really wasn’t wasting time or gas in doing it.

    Convenience and price. RedBox has it.

  14. Visitor [Join Now]
    Bill [visitor]

    HAHAHAHAHAHAHA….While the studios greedily try to grab every dollar they can the sand is eroding below their feet. You can watch virtually any new release the same weekend on the internet for free. Yes redbox is nice to use but in time when all tvs are connected to the internet they will all be redundant. How about this?? 10 cents per view via the internet? The group that comes up with this option will be the next facebook. The days of the dvd are numbered…

    • Visitor [Join Now]
      Red Rover [visitor]

      Numbered, yes, but they are long numbers at this point. Mass change takes a while. Critical mass and the tipping point to make the TV and internet the same device won’t happen for many years to come. Streaming will remain the talk of the future while most folks continue to insert the disk…for now.

  15. Member [Join Now]
    offthegrid

    If the price was raised to $3 the advantage the kiosks have over cable on demand movies would dwindle for me and I’d just order online rather than pickup and return.

    BB Express is actually more convenient for me now based on locations etc. There are more Redbox locations but only two close by at the same location and they are often full so that returns aren’t possible without renting more or someone renting another to make space. Frequently one of the two is also out of service.

    I don’t have any allegiance to one company or service. I use what works for me at the right price.

  16. Visitor [Join Now]
    dave g [visitor]

    Go ahead NCR. Your nincompoops and you will be helping Redbox out, Greedy is as greedy does…

  17. Visitor [Join Now]
    moonandstarsfairy [visitor]

    BBExpress is crazy for thinking of charging more. Their selection of new releases sucks as it is. I have been waiting over a month for a certain ‘new release’ movie and still have not been able to rent it because it is always ‘out of stock’. They only get in a small selection of new releases. I’m going back to redbox even tho I have to travel a distance to get to one!

  18. Visitor [Join Now]
    KendoWar [visitor]

    I understand the Universal Uping the Price. If and Only if we can get the new release. But if it has to go through the Major Theaters and then the small town theaters then it won’t be worth the price. A small town theater here charges $5.00 so why should I pay $3.00 later when I can see a first run movie for $5.00

  19. Visitor [Join Now]
    bluedog [visitor]

    1.The short form newsletter in my email inbox really sucks…………
    2. A premium price with a premium rental time is a really bad idea.
    ($1=1night …. $3 should = 3 nights) (if its a good movie)

  20. Visitor [Join Now]
    tee [visitor]

    $100,000,000 in revenue – $99,999,100 in costs.

    • Visitor [Join Now]
      firstlawofnature [visitor]

      Sherlock, the hundred million is cash generated after all costs and capital expenditures.

      • Visitor [Join Now]
        John Small [visitor]

        Methinks FLON has a bridge to sell people.

        • Visitor [Join Now]
          Firstlawofnature [visitor]

          Me thinks JS doesn’t know how to read financial statements. Look at the SEC filings to see cash generation. Read it and weep.

          Btw not that these thumbs up and downs matter too much but I note that you’ve been absolutely pumuled on this string. 15 thumbs down may be record. I’m not sure the VBG will be able to top that.

          • Visitor [Join Now]
            John Small [visitor]

            Methinks Flon does not understand what “cash generation” means in the greater context of a financial statement.

          • Visitor [Join Now]
            Firstlawofnature [visitor]

            You are such a spinner. These are numbers so there is no other ‘context’ in which to view coinstar’s cash generation. Can you even calculate year to date cash generation?

            Tough to combat your enemy when you can’t even understand whether or not they are generating cash. Its tough to call it unsustainable pricing while they generating so much cash.

          • Visitor [Join Now]
            John Small [visitor]

            Sigh. It is obvious you don’t even have the most rudimentary knowledge of business or accounting. Get back to me you get done high school.

          • Visitor [Join Now]
            firstlawofnature [visitor]

            Can you even calculate the amount of cash coinstar has generated this year so far? If so what is that #?

          • Visitor [Join Now]
            John Small [visitor]

            You don’t even know what you are asking for so how am I supposed to tell you what it is?

  21. Visitor [Join Now]
    tee [visitor]

    Einstein, it was a joke!