The day has come, Insiders. The epic and epochal battle between Redbox and the Hollywood Three has come to a close with today’s announcement of agreements between the kiosk operator, Fox and Universal. Echoing the Warner agreement that recently winnowed the Hollywood Three down to two, Redbox’s deals with Fox and Universal are multi-year distribution agreements that impose 28-day delay windows on new release titles for Redbox.
Craig Kornblau, president of Universal Studios Home Entertainment, spun the agreement as a positive development for Redbox customers with the following statement:
“While this arrangement mutually benefits our two companies, it’s more importantly a win for consumers who will now have increased access to Universal films at more than 20,000 Redbox locations nationwide . . . In forging this pact, we have successfully established balanced terms for our rental products in Redbox kiosks that provide consumers value and convenience in movie rentals.
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”
Redbox president Mitch Lowe made similar remarks:
“[These] agreements enable Redbox to fulfill our commitment to providing consumers affordable and convenient home entertainment.”
What say you, Insiders? Redbox gets to end its costly workaround program, and the studios get their much-coveted delay window that they hope will force consumers to purchase more titles, but what about consumers? Hit the comments and tell us how you think the end of this battle will shake out for Redbox customers.
(via Home Media Magazine)
The movie companies are going to be sadly mistaken in thinking that this is going to increase sales. People will either rent with from somewhere else or just wait the 28 days. Sucks that we going to have to wait to rent now. So much for all these law suits for nothing. Just for them to submit to what the movie companies want. Shouldn’t be too long until they make agreements with Blockbuster to have the movies available on day one. It’s already bad enough when you rent a movie and at times can’t even watch the special features cause they have a rental copy that doesn’t have any of the special features on the disc.
i agree 28 days is no big deal. ill wait or get it from bb express.
this obviously helps redbox. they thought so. it means they will get older
titles in their boxes. that is more valuable than 28 days.
it also means to studios are gonna be the losers in this deal.
I have spent countless days searching for new releases documented on REDBOX boards as available on certain dates. I cannot believe the movie companies are this greedy and controlling! It will make me much less apt to buy a movie know that I know their “tricks”. I have been accusing REDBOX of Bait and Switch, buy now I know why.. Another avenue to try is the local library. It is free, 7days and you can reserve online! FYI: I hate Blockbuster!
It’s a big win for Blockbuster who will have these for rent on day one.
Unfortunately, with Blockbusters pathetic service it’s a gamble whether you’ll actually get it. Oh, and if you do, it’s movie only with a boat load of adverts and zero special features.
Looks like it’s working for Blockbuster Express. I just looked online at one of my local kiosk and they are charging $2 a night for Avatar. I’m sure this will be the wave of the future with big Hollywood releases.
just rented avatar … bb express rules … FREE! code is g614a .. forget redbox!!!!!!!!!!!!!!!!!!!!!!!
Is BBI so broke that it needs spammers to pepper blogs as a form of advertising? Same idiots would show up years ago on Netflix sites.
Redbox and Blockbuster executives that have signed this deal, will soon be visited by the Justice department, or should be. This action by the tinseltown want-a-bes are no different than the MLB baseball owners decision to cap players salaries in the 90’s. By capping, or limiting the customer’s right to value, Hollywood and these Disk Distributors are joining the ranks of common mob thugs that take their cut and add cost to the customer. In this case the vending machine middlemen, cashed in their position as a value provider to get along with the Hollywood bosses.
Hollywood’s myoptic view of their business is to limited the distribution; feeling by doing so they can make a greater margin. Redbox by signing on the dotted line, sheds light on their try objective and business model; to be accepted in the limelight and make nice with Hollywood. Until we the customer get the true cost, the market will once again produce an innovative business model that is not weighted down with mob-like margins. Redbox has just killed itself, and they were almost there; come forth their replacement.
Putz redbox is giving millions of consumers an option they didn’t have before. Those chose cheap over higher prices. At a $1 they are keeping all the other distribution channels honest.
I agree that the Justice dept. should not be allowing deals like this. The “first sale” rule should apply. The movie industry shouldn’t be able to continue its cartel activities where they all agree to keep prices higher. It’s true in many industries today, where real competition and profit margins have very little to do with price any more, especially when it comes to intellectual property. It’s all about illegally colluding to impose a value perception on consumers.
When will we fight back against the wrong-headed idea of “rights” to creative works? It’s a constitutionally-created economic device to encourage creativity, NOT A RIGHT! And it’s only supposed to be for a “LIMITED TIME,” not decades and centuries.
“To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”
whats all the complaining about if you want to see a new release first day,do like i do,buy the blu-ray ! i only rent movies i’m not sure about. big hit movies such as avatar go straight to my expanding blu-ray collection, besides what better way to see a movie than blu-ray disc anyway. between xbox live playstation store amazon and netflix i don’t miss any new release. but then again i’m a movie addict !!
Looks like i’ll pay $2.59 a night at Family Video if I want to see a Fox, Warner, or Universal release on Day One. I wonder when the other remaining studios will want to work similar deals, i.e. Paramount, DreamWorks, Lionsgate, etc. Redbox might have just shot itself in the foot with these deals. They might be saving some $$$ by no longer having to work around Fox and Universal, but how much more $$$ are they costing themselves by agreeing to these 28-day windows? We’ll see I guess.
looks like i will pay NOTHING to rent on 1st day from bb express!!!!
code g614a. stop giving redbox cash and they WILL drop thier prices!!!
While this may be a bit of a sad day, I have to believe this ended up being the right move for Redbox – almost. The better move would have been to charge $2 for new releases for the first 28 days, making Redbox still the better value to get movies on day 1. But, what they did here was put themselves in a better position to work with the studios on digital distribution in the near future.
While I don’t know if this will cause more people to purchase a movie or not, I do know that this will give a nice boost to on-demand and streaming services. I would never go to Blockbuster to rent a movie for $3-5, but I would pay a streaming service like Vudu or iTunes that much if I REALLY wanted to watch something in the first 28 days (Avatar, maybe?). And, for the average consumer, their cable company will get a major boost in revenues for on-demand/PPV movies.
While I hoped this day would never come, I completely understand why Redbox did it. Now they can focus on growing their business without all of the litigation.
How long until Redbox takes down their “Save Low Cost DVDs” site (http://www.savelowcostdvds.com/) ?
yummy loves me some crow. redbox isn’t going to be doing streaming either.
a bettr question is how long till you take down the site insideredbox?
An even better question is why are you such a moron who really has nothing to add to the discussion here?
Oh, thats right, it because you are a shill and full of fud. Hope that works out for you!
pussy!!!! keep putting your positive spins on everything and tell me i’m a shill. your a joke.
But you are a shill, right?
The difference here is I have no real interest either way. No matter what happens, I still have stuff to write about. I don’t work for Redbox, or have any Coinstar stock, or have any monetary interest in the whether they fail or succeed.
Can you say the same? I don’t think so.
you own and make the money off the adds on insideredbox. how can you say you have no monetary interest in whether redbox suceeds or fails? god you are so full of shit. keep pedeling your codes douchebag.
You’re an ass. Clearly running a site like this is no big money maker versus the time invested. You probably own some crap vid store or something like that. Piss off.
Yeah you’re a regular fountain of truth. Now get back to the floor and rent those vids out.
yeah don’t forget the apps he’s making money on. i might be an ass but at least i’m not a bold face liar like mr. lantz here.
What is so hard to understand? Yes, I do make money off this site, but it is not dependent on good/bad news about Redbox. No matter what happens, there is still news to write about. Get it?
If Redbox screws up, we write about it. If Redbox does something great, we write about it. If another company does something interesting, we write about it.
If you take a look at the front page of the site right now, you will also notice that there are more stories about other industry companies than there are about Redbox.
You’re just upset because your company sucks and you have become irrelevant and are losing money. And, I am happy to write about that, too.
redbox fails = insideredbox fails. you said you had no monetary interest now you say you do. you act like your some kind of reporter or something. alls you do is take others news stories add them to your site and say now insiders sound off. michael in truth alls you are is a little computer geek from byu who is the definition of irrelevant!
Wow you are like a politician, aren’t you? Twisting words to make them say what you want…
In any case, I don’t have any more time to waste responding to you, and your opinions really don’t matter to me. Stick around, make some more dumb comments, or don’t.
Inside Redbox readers probably think your delusions are funny, though, so I vote you stay around and keep commenting! Maybe someone else will even respond to you…
i think this is one oc michael lantz’s other websites [removed]
[admin edit: posting links to pornography won’t be tolerated, so don’t waste your time]
oh did someone get caught in a lie?
cho mo
I can canceling my cable service and sticking with you guys!
This is great entertainemnt for cheap, keep at it guys!
Your turn to reply to suckit Mickey, or ya afraid of him?
Rel
I don’t expect much for a dollar. If I am going to wait until it hits video, who cares if I have to wait another 4 weeks? I don’t have time to keep up with release dates anyways. The segment of the population that is that impatient is so small. It is a common phenomenon for the people following trends like this, to be the vocal minority.
I agree with Steve. I can’t imagine that the people that zomgmustgetthemovieNOW is huge. For me I can wait those weeks, not a big deal.
Agree, not a big deal for me either. The only ones I see this wait being a big deal for are those who need immediate gratification–kind of like a kid having a tantrum at a candy store because they can’t have a certain piece of candy RIGHT NOW!!!
Good thing that Alvin and the Chimpmunks 2 is already out lol
I just rented Avatar at my BlockbusterExpress kiosk and they seem to have all the new releases that Redbox does not have!
ME too! FREE! code g614a
just saw Crazy Heart at my Red Box. It didn’t have the dvd cover though just a picture of a brown and red guitar.
Redbox’s selling point is new releases. Most people are going to find some way to watch a movie in the first 29 days after it is released and probably not again after that. My guess is this will increase illegal downloads more than dvd sales. People go to redbox because they don’t want to pay a few dollars more to rent at blockbuster. Those people are not going to pay $15 more so they can buy it instead.
michael, ignore “suckit”, he’s is a loser. keep up the great work. love the site and will continue visiting.
me, I’ll wait a month. big deal people. if you really like it that much buy it, otherwise it’s only a month. the movie studios aren’t going to recover anything. people like us are cheap and don’t think watching a movie once is worth $15+ (to buy) or even $5 (for other rentals).
This is just another example of money-hungry, greedy corporations (in this case two Hollywood stuidos) who instead of adapting to change strong-armed a company that was providing real value to the American public.
GO USA!
So as the movie execs high five themselves over their apparent “win”, I’ll point out this little nugget. The ads for new releases are running NOW. They are not free and this public has a very short attention span. By the time the “waiting period” is up, your audience is being fueled by new movie ads and yours is now an afterthought. The majority of the movies out rely on the ad push to excite people into viewing their mediocre product. Ya just your push, idiots. If I were a shareholder, I’d call for the beheading of some of these morons.
For the entertainment, lessee, what sports and vid games are asking for my fractured entertainment dollar?
Pound another nail.
You just gave the perfect reason for their victory, and that is exactly what it is over Redbox.
Now instead of losing out on sales and rental revenue at higher price points to the $1 a day kiosk market, they are instead theoretically increasing it. Granted, this still remains to be seen, but at least their is a bit of logic to their argument.
Now for Redbox, I hope they got a serious good price on their product. After 28 days, the demand for New Releases is pretty much dead. One of the reasons is just like you stated. Advertising is set up to drive demand for the product on the New Release day whether it be via purchase or rental. 28 days later, you will find virtually no advertising whatsoever for the titles that Redbox has just finally got into their machines.
Their driving point is the low cost aspect and what I see them doing is buying fewer copies at a lower price point in order to remain in business. I actually think this is a big win for Redbox as well. They have lowered their costs of good significantly. The only question that remains is how many customers they lose to the people that just don’t want to wait and will rent it now.
There is a HUGE amount of people that are New Release driven and could care less about movies that came out a month ago. When people are talking about current movies in conversation and you feel left out because you haven’t watched it yet because you are waiting for it to appear a month later in a Redbox machine, it makes you think.
Greed.. Pure and simple. Trying to force customers to buy instead of rent. I have a solution to that. Talk to all your friends, rent it once and have a party so you can all see it at the same time. Convince your friends to NOT buy the movie. Let’s show them we won’t stand for this. I did this for avatar – had 18 friends over and paid a whole $2.00 to rent one copy. I know at least half of them would have purchased the movie and after explaining all this crap to them I’ve got the majority convinced to NOT purchase.
I think Netflix has already demonstrated that plenty of consumers will alter their behavior when given proper incentives such as price, service & convenience. Netflix probably does 20% or less of title turns in the 1st 4 weeks (and that’s before the current 28 delay). At $1 a night Redbox clearly is driving new transactions that didn’t exist before. It isn’t just taking transactions away from stores. For this reason I believe Redbox will hold onto far more transactions than most imagine. Add in the lower content costs and I think Redbox will be stronger than ever post the new studio deals.
I’m kind of bummed about this deal, but at least we will now have release dates for Universal and Fox movies. Plus now we don’t have to deal with those custom covers (although it was always fun to see what they would be like)
Most of the movies they put out these days are crap anyway. Having to wait another 28 days to see a lousy movie won’t matter. Redbox should get into the streaming video over the internet business. That’s the future.
It really does sound like michael (above) was lying. Why? I think redbox without new releases loses alot of it’s appeal.
RENT bb express they RULE!!!
REDBOX codes … listen up … DVDONME and BREAKROOM work once per credit card and that you should already know. what you don’t know is that after some time frame (lets say 6 months) the codes will work once per credit card all over again!! give it a try with cards you have used before but havent used in a long time. i guess they dont care about transactions that happened 6 months or more ago. it may be longer than 6 months im not sure. but i know my cards work again now!
Awesome, I love the picture for this post! :)
Nice Touch Shane;
Personally I never really had a problem with the 28 day delay. So all is still well in my mind. Studio’s Happy = Consumer’s Unhappy / Studio’s Unhappy = Consumer’s Happy. It’s a predicament, a balance. There is always stuff like this, why worry, if seems weird but it is normal.
This is fine by me. I’d rather drive home the point to the studios
that the $5 movie rental price is DEAD. the studios still live
in the 1990’s where they think they can tell the consumer what to do.
$1 a night price point is now the norm…and if there is something
I just have to see right now and can’t wait, in the Oklahoma City Area,
there is 7-Eleven ( $1 a night), Hastings ($1.99 a night) and Family Video
($2.09 a night).
$2 is the maximum rental price now STUDIOS!! soon as you
get a clue, sooner you will turn a profit!!
I didn’t mention that Redbox might hurt by this because of Avatar, but once Redbox gets it they will do better
I think people need to quit acting like crackheads. These are movies not paychecks (in terms of urgency), and if you were willing to wait until they come out on video (likely because of prices in theatres) you should be willing to wait 28 days (again because of prices) to get them at Redbox. Either you will complain about the prices or the delay. There is no pleasing everyone and obviously by many of the responses above this site seems to attract people who will find some reason to complain about anything because of personal insecurities. Tlochner needs to quit complaining about renting things for free, if you want something free, go back to the soup kitchen!
On another note, Michael I really enjoy the website and being able to read in depth about movies and how people feel about the situations. No matter what they say other people take time out of their lives to log on to this site and send posts increasing your traffic on here, so really the joke is on them. It is so much easier to criticize others than to do something about it yourself. If people want to bash your website, they should just go make one of their own to compete with yours, as of yet I haven’t seen such actions take place.
Sounds like the studios were right. Redbox not getting the title for 28 days helps sell DVDs
The total sales count for Avatar after four days in stores is 6.7 million units, 20th Century Fox said, DVD and Blu-ray Disc combined. In the comparable time frame, consumers bought 5.2 million copies of The Dark Knight. Sales numbers are for North America (the United States and Canada) only.
Ok, not going to say that Redbox has anything to do with it, but don’t you think that there is just a “SMALL” possibility that Avatar is just one of those must own films? Let’s face it, there is a reason why it is the top grossing movie of all time.
I disagree. I think Avatar is more a “purchase” movie rather than a rental. Even if this one was available on redbox I would buy it instead. There are select few really good movies that actually do deserve to be purchased rather than only rented. Compare a mediocre movie and see what the stats are.
Spammer,
That’s absolutely the most foolish thing I’ve heard yet. Perhaps it had something to do with the fact that movie was a massive box office success.
I am a huge Redbox fan but it definitely has seemed lax in having many decent titles lately. Not sure if it’s just cause not much has been out lately or what, but I hope to see more variety. I also am not phased by the window and ads don’t bother me either. I usually just glance @ the release calendar for the month on the Redbox machine anyways. I am just waiting for summer to see Blu-rays finally!
Would $1.50 for blu-ray be fair in your opinion?
Yes I think it’s an ok price, but with Blu-ray sales starting to mirror DVD I just am seeing it as a way to keep prices inflated which is not going to help the format too much, but it’s alot better than everyone elses prices
luv this business analysis by presumably underemployed *right here* dads who cant afford to take the family out for a movie at $50. thus redbox. but redbox is instant gratification, which is tied emotionally to that marketing push around release date. Mail Netflix is not instant, maybe for strong independents and those w/o cable TV, else movie buffs. Right now I use redbox only for newly released 0-3 months, bc older is usually gone.
Score: Studios/Netflix/On-demand=28 Redbox/ClarkHoward fans=0
redbox will now have to retool its availibles to greater (older) selection, to match the value commitment its has made to some of its cutomers. And say goodbye to instant gratification types. There are 8 redboxes I pass daily, and I have internet to find my movie.
Li’l rant
Time was when in high school everybody talked about the new movie, prices now means 3 movies a year seen in the almost empty theaters (except opening weekend). Most family people only go ‘with the kids’ and so… With the ‘created for oscar nominee’ exception like precious, most movies are philosophically juvenile slop, racous horror for emo’s, or digital chipmunks for toddlers. In the macro as well as the micro, “you get what you (all) pay for.” BTW, the good movies are out there, but they aren’t advertised much. RottenTomatoes.com is a great place to start.
Well, I was away for the weekend so I didn’t see this until now.
I’m sure FLON will do the right thing. Right buddy?
I await your response patiently.
Remind me what I’m supposed to do again. I thought we wouldn’t necessarily see a deal and you did so you were correct on that front. Back to the war now…I think the distribution deals are not the cure the studios believe them to be. Redbox is very good shape in my opinion. Ordinary folks love the kiosks.
All you were supposed to do was admit that I was right.
Now, I know you want to believe that the $1.00 rental still has a valid business model at the kiosk level. And I believe that it may be able to survive the 28 day delay. But the profit level is so miniscule that I expect Coinstar to either consider slowing expansion or raise their prices even with the 28 day delay.
The reality is that Redbox will start to lose market share as a result of this deal. Will BB Express be able to fill the gap with higher rental prices ($2.00 for NR) and no delay? Will people start going back to trad. video stores. Will they go back to BB? That is a good question.
The “value conscious” renters may be willing to wait the 28 days. However, with increased streaming and stay at home options available even those people will soon tire of Redbox.
I’ll add some more info in the near future but you should know that, yes, I do know what I’m talking about and I do have an inside insight to the industry. Regardless of what the people on this board want, Redbox is not the future.
Hey John Small ……All you are suppose to do now is refer back to the Post on Feb 16th 2010: “Redbox Gives In To Warner, 28 day Delay Window On The Way.” and acknowledge the quote you made on Feb 17th at 8:13pm. Your quote follows, “To sum it all up, if Redbox accepts a 28 day delay on the big 3’s releases, I think they will be a SUCCESSFUL company.” Well, Redbox has accepted a 28 day delay with all big 3 studios, so to sum it all up in your own words, you must now admit that REDBOX IS A SUCCESSFUL COMPANY!!! Admit it! Admit!….Okay, so it’s been raining all day in Pa. and I have nothing better to do than go back and research the dates of your previous quotes –just for fun!!! :-)
Oh I do think they will be a successful company (just not a very good company). They will learn from this mistake and re-orient themselves. They will likely provide poorer service which only makes sense because who cares what kind of service you get if you only paid $1.00. They will likely provide less newer films and focus on keeping titles in the box longer (as seen by the plethora of older titles that they seem to bring in on a weekly basis). They will fill a niche in the market.
That niche is for cheap people who don’t really care what film they want to watch. Lots of businesses have made money of off providing bad product with poor service to cheap people. Redbox will figure that out too.
Blockbuster, any B&M, and NCR/BBE are about to hand Redbox their ass on new releases with their own promos combined with the original studio adveretising on new releases.
I did not have sexual relations with that woman, Miss Lewinsky.
Dug up the post…
‘I’ll take that wager for fun. Being right or wrong won’t matter much because we won’t know how much lower the DVDs will cost. At the right cost 28 days is fine. So for fun I’ll say redbox doesn’t need to do another deal right away. Don’t pat yourself on the back too hard if you win given what I’ve said above.’
So ok. You were right on that point.
But winning that friendly wager shouldn’t translate into this kind of confidence ‘….but you should know that, yes, I do know what I’m talking about and I do have an inside insight to the industry.’
Sorry but redbox is here to stay. They won’t lose too much revenue with the new deals and clearly are lowering their COGS. You should talk to more of their customers. Most of them use the kiosks because they are cheap and because they are located at places where they already go. They love eliminating an extra trip to the vid store. The units were already thin on new releases due to the work around so the 28 delay is not dramatically different to what they were accustomed to. As I said before netflix proves that with pricing and convenience consumer behavoir can be altered. Redbox, for a larger than you expect segment of the population, will shift demand for rentals further out. Bank on it.
Lots of companies streaming the exact same movies for the exact same price. Unlike physical product, studios have much more influence over pricing in the digital world. That’s why VOD and streaming all cost about the same. Unless the studios want to lower prices on VOD redbox will do fine. For some reason innovation around delivery on VOD is not capturing the attention of consumers in a big way. Granted some DVD sell through money is being siphoned by VOD but rental transactions (not dollars) and by the mail plans are not being hurt by digital yet. Unless studios bring down their pricing scheme I don’t think we’ll see mass adoption by consumers. DVDs do have some built in advantages as you know – they are cheap, can be loaned, traded, sold, they are reliable, more robust than streaming or VOD and have a massive installed base with uniform easy to use technology.
So sorry Redbox will be a force for some time.
I agree Redbox will be around just less relevant to the most important part of the industry: New Releases during the first 28 days.
Most B&M stores will have had 80% of their turns by then and can offer competitive pricing and greater selection than Redbox.
The person in a cheap mindset may still wait 28 days. The person without a B&M video store nearby may wait 28 days. But that subset is much smaller now.
Redbox will see lower revenue per box but have lower COGs per box. They will likely still squeeze a small profit per box but their growth numbers will fall.
Netflix subs keep 80 movies forward in their queue. They have stretched out new releases well beyond 4 weeks. This is evidence that consumer behavior can be altered with the right carrots. If you think redbox has zero chances of moving the needle here I would disagree.
Apparently you are having trouble reading or comprehending my posts FLON. Try harder.
I’m having trouble with your flow of logic. There doesn’t seem to be much going on there. Redbox and netflix are changing consumer behavior so looking at their business models against the traditional rules of thumb at B&M stores is short sited. Surely you would acknowledge the large changes in consumer behavior and channel.
Redbox has not changed anything. They have simply tapped into that portion of customers for whom price is the sole factor in renting a movie. That niche was always out there, Redbox just sunk to the bottom faster than the rest.
However , companies like Family Video are growing and thriving in competition with Redbox. Redbox is left in the dust when they try to beat Family Video. Indies are learning how to compete as well. Redbox simply is not all that you think it is and will continue to have trouble adapting as they move forward.
Redbox offers location and low price (and even this is becoming less of an advantage) but sacrifices timeliness, customer service and selection. Dissatisfaction with Redbox will continue to rise. I’ve seen the numbers.
Sure Family Video is doing a good job. Agree Redbox does a good job saving people money. Some vid stores will make it – survival of the fittest. Dissatisfaction is a function of a growing customer base. Maybe 5% of Netflix subs are dissatisfied and as they grow customers overall you end up a larger and larger base of dissatisfied users. Same true of Redbox.
Wait until you see the batch of numbers 6 months from now.
how many average joes, who know nothing about what’s going on with redbox, went to the kiosk looking for Avatar and where disappointed when it was no where to be found?
Those know-nothing average joes were probably disappointed when they didn’t find Avatar at Redbox—BUT not disappointed enough to pay $5 elsewhere to rent Avatar! Avatar is really not a good example to use when discussing ‘renting’ a dvd. As another blogger pointed out, Avatar is probably one of the very few movies most people will want to spend their money to buy/add to their dvd collection instead of rent it.
The indies are reporting that they are renting out 50-100 Avatars every day last weekend. BB is likely seeing similar numbers.
There are plenty of people who want to see the movie and not wait 28 days.
Ya don’t think avatar might be a bit of an outlier?
Good numbers were reported on Blind Side and Sherlock too.
With all of the channels available now, I’m not sure either way.
I for one will NOT be more likely to purchase a movie instead of waiting 28 days to get it at RedBox. I’ll waiting or get it someone else, but I WON’T purchase it … sorry folks.
Hell I’ve gone to video store closing and could purchase used CD /DVD’s for as little as $1.50 – $500 and I don’t purchase them, but hey that’s just me.
Skip
$500 dollars for a movie? I think you are buying them at the wrong places.
TrickyM, you’ve never paid $500? I laughed too when I saw that. Maybe in the 90’s with VHS and Late Fees.
I use redbox for new releases and Netflix for older movies. I keep track of when movies come out on DVD. If it’s a movie I really like (eg. Avatar) then I will buy it on blu-ray. All other movies are simply rentals. It annoys me that I will have to wait another month to rent the movies. I suppose the other alternatives is to rent from blockbuster or buy it? I will never rent from the over priced blockbuster. And like I said before, I make my decision whether to buy or rent right when it comes out to dvd. So just because I will be able to buy before I rent does not mean I will go out and buy it. Are people really going to fall for that? I hope not. It will be interesting to see if this really boosts DVD sales.
One last comment. I’m glad they decided to delay rather than increase the rental price on redbox. If Redbox would have increased to $2/night and get them for rental on day 1, I would no longer use them. Still pisses me off that they are delayed though. The movie studios will get no extra money from me! I already spend probably $50-$80 a month at the movie theater. They have enough of my money.
Why rent at all? Just watch TV. They show movies there too.
Because a $1 a night is his clearing price.
He’s wasting a buck then.
Your logic is crap but in sticking with your line of thinking better to waste $1 with redbox than $4 or $5 with blockbuster, amazon, cinemanow etc.
For him, yes it would be a waste.
If you are going to be cheap, you might as go all the way.
So if one rents from redbox after the 28 day delay one is cheap. If however one rents from blockbuster etc for $5 then one is not cheap. That’s not biased in the least is it?
Rational, realistic, truthful but not biased.
Your belief that Redbox renters are cheap and Blockbuster renters are not is the very definition of bias. Are all wal-mart customers cheap as well or are they smart because they save money by patronizing the store?
Are you saying that someone who pays $5.00 at Blockbuster is cheap as well?
Being only willing to pay $1.00 by waiting an extra 28 days instead of $5.00 to rent it now (which is really $1.00 a day for 5 days) is the very definition of cheap.
You can take offense at the word cheap if you wish. No offense is meant by using the word. It is just a factual descriptor for individuals who would prefer to use Redbox instead of paying more at another source for an opportunity to see something earlier.
‘Being only willing to pay $1.00 by waiting an extra 28 days instead of $5.00 to rent it now (which is really $1.00 a day for 5 days) is the very definition of cheap’
‘It is just a factual descriptor for individuals who would prefer to use Redbox instead of paying more at another source for an opportunity to see something earlier.’
So everyone that shops at wal-mart to save money is cheap? You make statements that are difficult to defend. Some people that use redbox may in fact be ‘cheap’ but others may simply be interested in saving money for other purposes.
“Some people that use redbox may in fact be ‘cheap’ but others may simply be interested in saving money for other purposes.”
Po-Tay-toe, Po-Ta-Toe
I suppose to the .05% of Americans that make their living hawking films your comments make perfect sense. To the rest of the country saving some money by using a redbox – if you can stand the wait – is perfectly logical.
Agreed. Cheap people will see that their time is less valuable and be willing to wait longer and pay less. That is a good thing for the entertainment industry as a whole.
J.S….”Cheap people will see that their time is less valuable and be willing to wait longer and pay less.”…..John, you’re losing credibility by the minute; you should stop while you’re ahead or at least hold on to what little credibility you have left. Knowledge is power;you should “edumacate” yourself by putting yourself in others’ shoes for once. If I’m being unkind, it’s because you’ve been attacking ‘budget minded’ Redbox consumers by constantly using the phrase ‘cheap’ people/Redbox consumers in a degrading way. Perhaps we ‘cheap’ people who use Redbox are willing to wait the 28 days because we understand and have determined that our time and money is more valuable than what the studios are trying to “devalue” us into believing. LIFE ALERT! Watching a new release dvd on day one doesn’t make a person ‘valuable’. You/the studios seem to be trying to make ‘budget minded’ consumers believe that they only have ‘value’ in life if they can afford a new release on day one, or even have more value ‘as a person’ if they buy that new release on day one. When you , along with the studios, make such conclusions about a person’s real ‘value’ , it has the ‘yak’ factor…
rb, you are misunderstanding what I am saying. You are taking the word “cheap” and assigning it negative connotations. That is not the case.
J.S….The word ‘cheap’ takes on a negative connotation when you are describing a person’s reluctance to provide even for a necessity in life when the person can well afford that ‘necessity’. It’s a matter of necessity vs luxury. Somehow, I don’t think of renting or buying a new release dvd as a necessity. So if I misunderstood your continual use of the word ‘cheap’ in describing ONLY the people/Redbox customers who will wait the 28 days to pay $1 vs $5 for a rental, or whose time you have determined must be less valuable because they are willing to wait, or as you said in a previous blog something to the effect that those people who are willing to wait the 28 days are the very definition of ‘cheap’ people—well, you’ll have to convince me that I ‘misunderstand’ your use of the word ‘cheap’ as somehow ‘negative’.
I think there is a happy medium of prices in between $1.00 and $5.00 that are options for people if they are willing to look for them.
Someone willing to wait 28 days to get something at a discount is cheap. That is undeniable. If you consider that to be a bad thing then that is your issue.
I, on the other hand, have no problem with someone who is willing to wait that period to get their discount. I do think of them as cheap but with no negative connotations attached.
Cheap people should know while they are an important part of the economy, they are by no means the most important part at all. When you are willing to wait for a discount, your opinion gets discounted as well. You become more of an afterthought rather than a target market.
Sorry J.S., tried to follow your logic but hard to follow WHEN YOU HAVE NONE! Now you’re trying to reason that the ‘cheap’ people who refuse to buy new release dvds or pay $5 for rentals on day one of release instead of wait the 28 days to pay $1 Redbox rental price have no opinions or influence on the industry that matters….Seems to me that the ‘cheap’ people/customers have the most influence as it was their evaluation/opinion/determination that the studios overvalued thus overpriced their product in the first place that led to the demise of rev-sharing BB, and other over-priced rental outlets. Studios put the blame on Redbox low rental price as devaluing the industry, when in fact the studios overvalued their product–and underestimated the force/power of the ‘cheap’ people of the world! Heck, the whole 28 day delay the studios muscled upon Redbox/Netflix, etc. is because of the influence and power of the ‘cheap’ people who threatened the studios new release dvd sales….. Studios keep trying to blame Redbox for this, but that’s like blaming the gun used in a murder instead of the person who fired the gun… Consumers–cheap people–control the gun. Studios overvaluing their dvds/product in the first place is what brought about a decline in dvd sales–not low rental prices. A movie like Avatar actually has ‘value’, and therefore, sales will be good regardless of low or high rental prices. Not too many other dvds put out by the studios have real value, and the consumer has determined this–thus a decline in dvd sales….
Industry considers the cheap people the end of the cycle. They make more money of the initial part and the money from the cheap people is just gravy to them. They don’t like them but understand that they exist and so tolerate them.
The problem is when the cheap interferes with proper price cycle of a product.
There are lots of people willing to pay $5.00 for a rental in the first 28 days. Lots of people willing to pay $4.00, $3.00, $2.00 a rental during that period too. If the pricing drops immediately to $1.00 lots of profit is being left on the table.
That is why the window was needed.
BTW, even though the studios talked about sales of DVDs you should understand that part of the sales number is DVDs sold to rental stores. That number was dropping as well because stores were being closed and stores were lowering their purchase numbers due to Redbox encroachment. Getting that window allows the other rental channels to increase their buy rates as well.
I agree with much of what John says here, but I do have some differences in terminology I would use.
I do not call what Redbox did to the industry “devaluing”, but “disrupting”. The Redbox pricing model certainly disrupted the market, particularly since they grew so quickly, and stopped the inflation of rental prices that had been going on for awhile. Grocery store video rentals were already priced like Redbox ($1 per day, at least in my area) at stores like Albertsons, but when Redbox came along, they increased the footprint of available $1 rentals exponentially, thus causing a disruption to the industry.
I agree that there are many willing to pay $5 for a rental, but I think that time is going away quickly, especially since digital rentals (via on demand, iTunes, Amazon, Vudu, etc..) are going to disrupt B&M stores at this price point more than anything. I do see the price at these stores dropping back to “normal” levels, to about $3 for 2 days on new releases. This is how it used to be back at Blockbuster 8-10 years ago, and is really where the price belongs.
Redbox helped “rebalance” the industry to this point, and also helped speed up the adoption of digital services. Is that really what they wanted to do? Probably not, but I am all for making the move to digital sooner rather than later. If Redbox goes down because of it, so be it. If not, they will adjust to this, which is why they are testing the waters on digital movies and subscription services themselves.
The real issue here is customer confusion, which will lead problems for the studios, I think. When they see a movie released but not available for rental, they really have no idea why. I don’t think this will cause a substantial amount of people to buy the DVD, but instead cause them to find “other” ways to obtain it. That may be through a digital service, it may be through Blockbuster, or it may be pirating or borrowing from a friend.
Do I think what the studios are doing to Redbox is wrong? Yes. If the Redbox model was truly flawed, they should have let Redbox hang themselves. If, though, Redbox could turn a fair profit while providing a better value to consumers, so be it. Do I understand why the studios did what they did? Absolutely, and I can’t say I wouldn’t have taken similar measures to protect my profits if I was in the same position. If they did something illegal, though, they should be held accountable for that. If not, consumers like us will decide in the end what happens as we vote with our wallets.
Stay tuned to Inside Redbox as the epic battle between corporations and consumers continues…
The only problem Michael, is that if the studios had allowed Redbox to hang themselves, it would have taken down well established distributors with them. And those distributors owe the studios 100s of millions of dollars which they would never see.
Now the studios could have demanded payment up front for their product but that would have seriously messed with the cash flow equation in the industry (and likely resulted in bankruptcy too).
So pushing Redbox into a 28 day window was the best option for everyone involved. It allows Redbox to pay a proportionate price for their COGS compared to the price they want to charge, it doesn’t wipe billion dollar businesses off the map and it allows rental channels that charge more for the product to be able to charge what the market will bear.
Good post BTW.
It seems like I can’t get what I want from NetFlix anymore because of a “Long Wait’, etc. I used to go to RedBox when I ran into this, but no more. Years ago when the movie companies owned the movie theatres, (that is, controlled the distribution) neighborhood theatres never got the new releases until they had played for 4 to 6 weeks in the “down-town” locations. The Supreme Court ruled this out when they ruled that the studios could no longer own the cinemas. It was a restraint of trade. Seems to me that something similar is going on here. I think it would be in the interests of all if a consumer action group filed a class action suit. I can see where NetFlix 7 RedBox had to cave in: they wouldn’t have any movies to rent if they hadn’t.
Class action would fail. You have lots of options to rent movies in the marketplace.
If you are to cheap to pay a decent price, then you have to wait.
I don’t understand what was wrong with RedBox having new releases. If they would make good movies, I would buy them. To often I have paid the 15+ dollars to buy a crappy movie. Its not a matter of being to cheap its a matter of not wanting to get stuck with a movie not worth the disk it was printed on.
It is simple. The studios make most of their money off of DVD sales and rental. Redbox was killing off both sides of that equation. If the studios lose that stream of revenue, they stop making marginally profitable films and just make blockbusters that suck.
By renting movies at $1.00 you are telling the studios that only the big and crappy films are worth making.
LOL…so redbox is determining what kind of films the studios make? Eliminate redbox and all will be well in hollywood again. What a joke.
FLON, surely you are smarter than that?
You know that studios have to make money somewhere. If people stop paying a reasonable rate for their DVD rentals where do you think that money will come from.
Yeah Netflix and Redbox are ruining the studios business. Again love your ‘reasonable’ wording. Reasonable is what the market will bear. Studios minted money for well over a decade selling DVDs to the public. As a downside to that they are forced to accept renting. Net net they came out way ahead. It must be sad for them to be getting paid less for their content but alas this is the nature of things in a competitive world.
If you are the IP holder, you get to decide what you charge for your product. Redbox did not want to pay the same price that BB and the rest of the industry was willing to pay. So they get to be the 28 day later el cheapo option now. That is totally fair.
“If you are the IP holder, you get to decide what you charge for your product.”
John, intentional or not, you are misleading people here. It is true that the IP holder gets to decide what a product sells at the first time it is sold, but after that it can be sold at whatever price the new owner decides.
Now, there are cases where an IP holder uses contracts to “fix” prices, but this is illegal in most cases and has been shot down many times by the courts. This is basically what is happening with the studios “distribution” deals with Ingram and VPD. The studios have been on the edge of the law many times, and will continue to push the limits as long as they are unchecked.
It is my belief that Redbox would have won these lawsuits against the studios if they stuck with them, but the studios had Redbox in a tough position and they knew it. They could have drawn this out for years, and Redbox could not withstand the difficulties that were caused by the supply chain for that long.
So, is what happened best for everyone? For the short term, it gives the studios a reprieve, and it may just be long enough to get people to move to streaming that their profits will be safe. Since licensing deals for digital media are very different (and definitely favors the studios), this may be all they needed.
For the consumer, there is really no significant change here, as long as many are willing to wait 28 days after the sale date to rent their movies. I have no problem with this, and it will not change my renting/buying habits at all. For some, it may cause them to go back to Blockbuster, or to buy a movie they are considering.
In the grand scheme, none of what happened here will matter much. Whether that is good or bad remains to be seen.
michael tell us again how all is right with the good ship redbox. you are such an errand boy. how can you say stuff with a straight face?
‘If you are the IP holder, you get to decide what you charge for your product.’
First sale doctrine begs to differ. Nuff said by Michael in response to your misleading comments.
‘michael tell us again how all is right with the good ship redbox. you are such an errand boy. how can you say stuff with a straight face?’
If you have anything intelligent to add please feel free to do so.
Michael, you are misconstruing what I said.
The studios are under no compulsion to sell to whomever wants to buy their product. They can set constraints on how many distributors they sell to. They can set constraints on who can get a direct account. None of that is illegal.
The studios have complete control over the price of the First Sale of their product.
Redbox was NEVER going to win this lawsuit. It was dead in the water before it even started.
Not to mention the the distributors in question were desperate to get out from under the Redbox deal they had in place since it was sending them into bankruptcy.
I have Time Warner Cable and have already seen commercials advertising for Movies on Demand where they say you cant get it with Redbox and Netflix they make you wait 28 days. The commercial I saw was specifically for Sherlock Holmes.
I’ve already canceled my Netflix account.
this changes nothing for me i will still enjoy the demise of blockbuster.i will continue to use redbox and netflix.
i am not using on demand from comcast and i never will its too expensive.i am not going to stream from any site other than netflix either so suck it studios!
john small are you still protecting those thieves?
Which “thieves” would you be talking about? The “thieves” at Redbox who tried to force IP holders to give them their product at an unsustainable price?
At one time we had THREE Family Video locations…now we have only one. However, business at the only remaining location is booming(The line to rent “Avatar” was back into the video game section on Day One), even with Redbox as competition. It doesn’t hurt that the building houses a Little Caesars Pizza location as well, which creates cross-traffic for both businesses. With the 28-day delay window now in effect, I am betting that business for the windowed releases will probably increase. FV’s $2.59 a night for a new release is fair and reasonable. BB’s $5 a night charge is unacceptable. BB needs to either compete with FV and/or RB, or just fade into the sunset with Hollywood Video and all the other dead B&M rental companies. I am sticking with companies that charge a fair price for their goods-FV, RB, and Netflix all fit that mantra.
john i am referring to the companies you represent you shilltake your trash somewhere else
Sorry Jerry. I’ve been here longer than you so I have seniority. However, because I am more civilized than you, I won’t ask you to leave.
If you had been smart enough to look through my previous posts, you would know that I do not represent any entertainment company.
I do, however, have insider knowledge of the entertainment industry and use that information to try and educate the people of this board.
If you wish to continue to wallow in ignorance, please feel free to ignore my postings. However, if you wish to enlighten yourself, put aside your petty anger and read what I post. It is the truth and will help you to see the light.
Uhh… Mr. Small, you should stop embarrassing yourself! “I do, however have insider knowledge of the entertainment
industry…” – lol – NO YOU DON’T! It is rather sad that you feel you have
take to the message boards to make yourself feel like somebody!
Will, you know nothing about me so why would you pass judgement on me? That seems to be rather ignorant don’t you think.
What you should do is read my past posts and then go and do some reading on the entertainment industry. You will see that what I have been posting is true and many times I post the information before it comes to light in the MSM.
I am only posting here so that people can understand what is really happening within the entertainment industry. What benefit are you bringing to this board other than unsubstantiated attacks upon my person?
Ok, first of all, this is NOT a “win” for consumers! Such statement is actually patronizing… am I wrong?? This will not force consumers to buy movies, but rather seek other avenues for renting. MOST movies, and I’m sorry to say this, are only worth renting and seeing one time, not actually worth adding to one’s personal library! There are movies, and I’ll just throw Avatar out there, that are absolutely worth buying as “must haves”. But most movies, Armored (Matt Dillon) for example, are only worth a “rent-and-watch-one-time” type of flick. I’ll just wait the ridiculous 28 days!