Not sure who would've guessed that Redbox Kiosk rentals would be this successful, but evidently most don't mind heading out of the house to rent a movie if the price is right. But it seems that as popular as the disc vending machines are with consumers, Hollywood isn't too keen on the idea. Evidently it is believed that the $1 rental fee is more effective at motivating consumers to rent instead of buy when compared with other alternatives like Netflix and Blockbuster. The interesting thing here to us is that at least one studio (Universal) has attempted to delay selling titles to the company in an attempt to help DVD sales, but as you might expect, Redbox responded with a lawsuit -- which is still pending. Seems to us that Redbox is yet another great example of how packaged media isn't dead, because if for no other reason it is useful because it helps prevent the draconian control of content that Hollywood would obviously love to have.
posted Apr 3rd 2009 12:12PM
Boo freaking hooo Hollywood
I think the biggest reason Redbox is doing so well, and getting people past the "inconvenience" of renting physical media, is that their kiosks are placed where people are going anyway. If you're stopping at the supermarket on the way home anyway, sure you'll spring for a $1 disc rental while you're there.
That and it's freaking ONE DOLLAR!! I mean, come on, that's so cheap. I mean, even in today's economy, most of us could still locate a dollar's worth of change in our couch cushions. Granted I personally wouldn't be caught dead watching a DVD if the movie is available in HD, but most people can still stand to watch DVDs. I know, crazy huh.
I have two Redbox machines just a couple of blocks from my house and another 5 or 6 within a couple of miles. You can check the availability at any machine and reserve them online and return the movies at any machine you happen to be driving by. The outdoor machines at grocery stores and McDonalds are open 24/7. All this for only a Buck? It totally rocks.
OK, you can't always get the latest releases as quickly as a Blockbuster, although if you check first thing Tuesday mornings they're easy to reserve. But it is a great business model for the consumer. Especially if you still like having physical media with all the extra features (which I do) and don't mind driving, or walking a couple of minutes to get it. Everyone I know is loving it. Studio's? Apparently not so much. But when it comes to new technology and renting/vending methods they seem to be behind the curve most of the time anyway. No wonder they're getting clobbered and then complaining that it is our fault for not doing it their way...
They'll have to get more Blu-ray titles before they lure me away from Netflix. But once they do, I could see myself heading there.
Those ridiculous new extra fees Netflix wants for BRD wasn't enough to convince you to start searching elsewhere?
I don't see how Hollywood could legitimately treat all other rental companies one way and treat Redbox another. That just reeks of anti-trust concerns. Either you sell to rental companies or not. You don't get to punish a company just because they run a more efficient operation than their competitors and you are afraid everyone else migth have to compete as well.
I'd love it if Engadget HD could do a little investigating into the inner workings of movie rentals. It used to be that Blockbuster simply paid a higher price for their discs than the consumer which gave them the right to rent it as much as they wanted, with the understanding that there was a physical limitation to how many times a disc could be rented before it needed replacing.
But is this this still true? Or do rental places give hollywood a cut of each rental they make now similar to record stations? And I would assume that digital rentals have some sort of revenue sharing agreement. I doubt Hollywood would let Netflix pay a set price off a movie and then make unlimited money off of it by streaming a single copy to millions of households.
Can anyone explain how in the heck they (Redbox) are making any money at $1 a rental?
Very Low Overhead.
I'd like to know that, especially when video on demand movies cost 4x as much and compressed HD is 6x as much.
Regardless of why, that's why I never rent from on-demand services... it's rape.
oh no, you're mistaken... it's actually $1 from the time you rented it out to 9pm the next day, so while there's no "late fees" technically they still are, and you get to keep the DVDs after 25 days (of course, paying at least 25% or more over retail)
allow me to clear up some confusion. VOD and payperview flicks don't COST much at all, the companies CHARGE around 6 bucks because they can.
Redbox rocks. Hollywood (OK, Universal) better stop crying & be glad places like RedBox at least generates some revenue for them!
With so many alternatives, the day of plonking down $19.95 for a DVD you'll watch 2x, maybe 3x, is long past..... not to mention the economy.
If studios were wise, they'd release DVDs for $9.95 the same day as the theatrical release. Word is at least one major studio is studying the idea (they already do it in China because the Chinese will pirate it the same day anyway.)
i beg to differ there are movies that i have watched at lest 10 times.. and i like to keep them so i can watch them when ever i want too
so to me it is worth spending 20 bucks on a movie that i can watch over and over. plus i get the extra features
And to think, Ben, you didn't know what Redbox was just a few podcasts ago! Now, if they would only get that iPhone app out, I'd really be happy.
Here's what Hollywood doesn't get and why movie distribution and production will get fractionalized over time.
DVD's don't work. They worked in the age of the CD when you needed the physical media. This is the age of VOD, where people will pay to watch when they want to watch, just like iTunes allows people to buy the song they want without having to buy the whole album.
Ultimately, there are movies that I'd never buy but still want to see. I realize that there are movies I'd watch over and over again (which I buy) and movies I see once and that was enough (which I hope to never see, not even on TNT or TBS). This kind of shortsightedness is horrible. They only focus on the money they make with something old instead of how many more people get to see movies because they're only a buck. Those are the same people that would have never paid the $20 to get the DVD, or the $10 to see it in the theaters.
Chance Stevens
Editor, http://www.tvlampsnbulbs.com
Can somebody tell me if it is possible to find out which Redbox has blu-ray in your area. Does it say on the machine? Or is in under the title of a specific movie?
I've been a big Redbox fan for a few years now...they are mainly in our grocery stores here in CT. The one in our local Stop & Shop was so popular they added a 2nd one in the same store.
Also love that you can return it at any Redbox. We rented at a McDonalds in Baltimore while driving home from South Carolina to keep the kid entertained for the tail end of a long drive, and returned it the next day in CT.
I have DirecTV, and while VOD is available, it takes forever to download a movie...I'm just as happy plunking down a buck (or 2 or 3 if we are tardy in returning it) for a movie..
Don't forget to check out the free promo codes at http://www.insideredbox.com/redbox-codes/. You can't use a promo code when reserving online, but it sure is nice to have a free rental!
I don't currently own a Blu Ray player, but if Redbox takes its cheap rentals to Blu Ray at all locations I might feel the need to purchase a Blu Ray Player!
Redbox doesn't work for _me_ because I don't go to redbox locations daily, so a rental will be multiple days (costing multiple dollars). If I went to Walmart every day, then it would be worthwhile.
Might work better for me if I rented on, say Saturday morning and returned it Sunday night, thus having plenty of time to watch the movie.
The funny thing is that I never noticed redbox until the whole universal flap landed them in the newspaper. It was an article about how the studios are mad that redbox is too cheap, and I was like hmmmm. Why am I renting things at blockbuster.
I've been going there ever since then and I love it.
I love it. Its really convenient and there are a few within a mile of where I live. I like that I can just reserve it and pick it up at the store.
Love the Redbox! My Netflix queue is pretty long, so I can use the free rental codes they send out on Monday to keep up to date with recent releases.
Newsgroup is much better ! ;)
Great article. I recently wrote an article about a spinoff by Coinstar of Redbox. For anyone interested the article can be found here: www.WantingGreen.blogspot.com