Redbox Being Challenged By The Movie Studios

by admin on December 16, 2009

in Movie Rental

Redbox is suing 21st Century Fox and Universal Studios for telling Redbox to wait a few weeks after their movies go on sell before renting them. In the past the studios had attempted to prevent movie rental stores from even starting. This attack against Red Box seems like another attempt by the movie studios to prevent a movie rental business model from developing.

The Redbox movie rental boxes in Walmart actually help the movie studios considering Redbox users rent about 20% more movies then other more traditional movie rental stores. Redbox has sold more then 77 million dollars in DVD’s through their boxes from users who have decided to keep the DVD rather then return it. All in all a case can be made that Redbox is really helping the movie studios rather then hurting them.

Since Redbox is a new business model the movie studios are just unsure about how it will effect their bottom line. The fact is Redbox is increasing volume, providing savings back to the consumer and offering a more convenient way to rent movies. Over the next few years Redbox will be helping the movie studios rather than hurting them as they offer a more effecient way to purchase and rent movies.

The movie studios like any major cash cow business becomes stuck in the familiar old school ways of doing business and are uncomfortable venturing out and trying something new to increase sales. They see Redbox making all this movie money and they feel that Redbox is shaving profit margin from new DVD sales. The fact of the matter is that Redbox stepped up and provided a more affordable and convenient way to shop and rent DVD’s by paying a dollar a day from convenient Walmart red boxes.

I have bought atleast one Redbox DVD simply because I never returned it. I have rented more movies that I would have never rented before because of the convenience of Redbox and I enjoy the limited but good selection of top dvd rentals. I end up spending an hour or two in a DVD movie rental store but only about 5 minutes searching for a movie rental using Redbox.

The movie studios need to leave those little Redbox movie rental boxes in the Tyler Texas Walmarts alone. We Tylerites like our Redbox, they’re good for me.

{ 3 comments… read them below or add one }

Jack January 29, 2010 at 7:49 am

"their good for me"

It's they're, not their

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admin January 29, 2010 at 8:14 am

Thanks for the correction Jack. Oh and nerd alert 🙂

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admin June 15, 2010 at 3:06 pm

In a victory for the movie renting population of America, Redbox and Paramount Home Entertainment have a reached an agreement to bring new release DVD and Blu-ray titles to Redbox kiosks on release date. No 28-day rental penalties to report here.

Variety reports the decision was made following a 10-month trial period during which — contrary to previous reports — Redbox new release rentals did not negatively influence DVD sales. In fact, the company “has seen higher DVD conversion rates.”

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