Redbox Kiosks Crank Out Cheap DVD Rentals, Doom For Hollywood
With its ubiquitous DVD rental kiosks, Redbox has been known to toy with our emotions. The machines have taken up all the choice grocery store spots where your favorite stale gumball machines used to sit. And company execs taunted us by dreaming up that awesome Free Movie Mondays promotion only to vow to take it away by the end of the summer.
But the most heinous act of Redbox — other than subjecting witless viewers to Bride Wars — is destroying the very fabric of the movie industry. Take it away, L.A. Times:
The discount DVD rental business worries Hollywood movie studios because of fears that it is undercutting DVD sales, which dropped 13% in the fourth quarter and were projected to fall at least 6% more in the first quarter, according to analysts.
DVD sales historically have been how the studios earn a profit on movies, because ticket sales are barely enough to offset production and marketing costs. Some studios believe that consumers will forgo buying DVDs if they have a cheap option to rent movies.
"You could make a bit of an argument that rental is cannibalizing [DVD purchases] in 2008, especially in a recession year, where everyone is watching their nickels," said Tom Adams, a video industry analyst.
The logic goes that people pay $1 to rent Bride Wars rather than $16 to buy the DVD. The studio fails, the sequel Bride Wars 2: Electric Boogaloo doesn't get made, and Anne Hathaway is a homeless bag lady. And then when Hathaway wants to see a Keanu Reeves movie, all she can afford is to rent it for $1 from Redbox, thus leading to Reeves' homelessness. And the cycle continues, with more homeless actors spending too little to rent more and more movies, systematically making their colleagues homeless until all that's left are Harry Potter movies. And no one wants that.
Oh well, even though Redbox threatens to undermine the very stability of mankind's ability to sustain an entertainment industry, at least we can count on Redbox not to allow our credit card info to be skimmed.
Redbox's $1 vending-machine video rentals worry movie studios [Los Angeles Times]
(Photo:KitanaOR)
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Comments:
I tell you what...if Anne Hathaway ends up homeless, I volunteer to take her in and give her a proper bath at least once a day.
Hmmm, they don't think the weak economy had something to do with drop in DVD sales??
...and maybe if DVD's were more reasonable people would be more apt to buy them. Since most DVD's are released as some "special super duper extended edition" and cost on average $20, it's hardly worthwhile unless its something you really want. If DVD's could come out at $15 and stay at or below that level (many places jack up the price of new movies after the first week or two on sale), people would be more likely to buy them.
I think their bigger concern should be streaming - if I rent a redbox movie for $1 and really like it, I'll probably buy it. If I stream something from Netflix and like it, I have no need to buy it (unless I want the "special features") because I can watch it on my computer whenever I want.
Or they could, you know, make content that's so good that people want to buy it no matter how cheap it is to rent.
Naw, that's just crazy talk.
I seriously don't think Redbox had anything to do with that drop in sales.
I see them here and there in grocery stores, but why bother with those when I have Netflix? No one I know even uses Redbox.
Maybe if they didn't spend the movie's entire budget again on marketing, they'd have better margins. I mean, does any movie really need $100m spent on promotion? Does $10m on Dark Knight Happy Meals actually translate into an extra $10m on the gross, let alone the net?
So if I understand it right, haven't DVDs or VHSs been available to rent for years at (relatively speaking) cheaper prices than their retail counterparts? Say five years ago, I could rent the Bride Wars for $4 and now I can rent it for $1 that I am less likely to buy it than I was five years ago? That's bizarre.
I don't suppose a drop in fourth quarter sales last year has anything to do with the recession....?
I buy DVDs, but only when I can catch them around a $5 price point. $20 for a DVD? NEVER! I will buy used before I pay that much. I see no purpose supporting the MPAA or the greedy studios that make moronic films.
Bride Wars 2: Electric Boogaloo
This made my morning.
Maybe studios should make movies people want to see, and budget accordingly. Instead, they'll keep wasting money on box office bombs and complain about everyone else but themselves.
Red Box is a great idea. I have NEVER had a problem with it. Very easy to search thru, don't have to talk to any clerks to get the vid I want. I don't need a membership either.
Good deal, $1 a night, can't beat it with a stick.
@Sockatume: Somehow I doubt it.
All a movie really needs is a trailer that has the plot. If what's going on is interesting that's all it needs.
Nobody needs to be "teased" about a movie that won't come out for at least six months. Nobody needs a trailer playing up the comedic parts of the movie and a trailer playing up the action. Nobody needs a trailer that spoils major plot points and surprise moments and nobody needs for there to be enough long trailers that you can stitch together entire scenes.
Kids don't have to associate a movie with food to want to see it any more than adults have to associate a movie with a car, pair of shades, or a watch.
What's weird is that the movies who need it the least are the ones who get the most marketing.
Moronic films that you seem to want to watch.
I can never understand this line of reasoning. It's very much like the old complaint/joke about a restaurant: "The food's terrible! And the portions are tiny!"
@UniComp:
They are making movies people want to see - box office grosses are doing very well. The problem is that the business model, for some time, has been that DVD sales are where the studios make the money - box office is almost a loss leader. If DVD sales go down the tubes, then that means the whole model has to change.
i hate redbox simply because I first saw them associated with McDonalds. I can only handle one evil empire at a time.
@Sockatume: Yes.
Not $10m at the box office, but an additional $10m or more in toys and or kid-friendly items. Remember, Dark Knight (for example) was rated PG-13, and most parents had enough sense not to take their kids. In order to lure kids into the market, they spent some omney on giving away small toys. That leads to lots of other purchases.
I have netflix but I also use redbox. There is a redbox is the building by my office so I can grab one on the way home then return it the next morning for only a buck. It works out being much cheaper than netflix and I can see more movies.
Then they're REALLY going to hate this: I get DVD's for free ... from my library. And all the latest, up-to-date flicks out there.
I used Redbox once or twice. Pretty good ... and if you search Twitter they usually provide a code for a free rental on Mondays.
Well, considering the lack of any great movies last year (seriously, I've been alive for 32 years and I can't think of any year more disappointing for new releases than 2008) along with the economic "downturn" and the fact more and more of joe public is embracing pure digital media via electronic delivery (be it legal or not) there really is no surprise the physical entertainment media market is slumping.
The Movie Industry (as well as the recording industry) needs to get away from the concept of physical media... It's going the way of the dodo!
It seems like they should be whining about Netflix as well by this logic. I pay less than ten bucks a month to rent 3-5 dvds (on average) plus "watch instantly" a couple + movies/tv shows streaming every month...
For me, buying a dvd is a waste, as there are only a handful of movies I have the urge to watch multiple times.
@docrice: I don't find the price of DVDs to be that high. I simply can take my wallet somewhere else and purchase it for less than the MSRP. I've never purchased a Blu-ray disc full price. I wait for a sale because I determine where I spend my money.
But the reason why I'm buying fewer movies is simply that there are fewer movies I would like to own. Redbox has made it much easier to spend that $1 and tax and get a movie that may delight you, or may tank. But either way, you're only out $1 and tax.
I only buy movies on DVD that I know I'll enjoy, and that I have probably seen before in theaters and would like to own on DVD.
When movie ticket prices stop sky rocketing (just paid $14 to see Star Trek) then I might consider buying a dvd rather than renting from a red box. Red Box is a great deal when you consider Blockbuster is charging $3+ a night for one movie if you don't buy into their 'rent-two-at-a-time-with-no-late-fee' option. Like my boyfriend said, what Red Box needs now is a Blu Box, where all they have available is Blu-Ray for those of us who bought a PS3 for the great Blu-Ray. I don't know about everyone else, but when a theatre is charging $8.50 for a ticket, and the student ticket is $8.25, I really don't see the savings for a student there. I realize bigger movie budgets means higher ticket prices, but the student price could actually be a deal, and not a quarter difference.
@UniComp: But who are these fabled "people" you speak of? Everyone has different tastes. For every Transporter 3, there are plenty of Slumdog Millionaires. Who is to say one is worthier than the other simply because "people" tend to enjoy one more than the other. I find myself possibly enjoying both equally, depending on my mood.
Now, anything with Nicholas Cage should be rethought, but for the majority of films, there needs to be a Transporter 3 for every Slumdog Millionaire. We as people are really that complex that we may enjoy both, possibly on the same day.
@Drew Biondo: Not everyone can do this. I've never browsed my library's DVD collection simply because while I read a lot of books, I tend to keep my the books for a few weeks (which is the allotted time) while I can go through two movies a week. It evens out if I have to drive specifically to the library just to return a DVD and get another one, but if I'm going to the grocery store anyway, I can easily just use redbox.
@cc82: I'm one of those people who can watch films multiple times without ever getting bored of them. This is why I only buy movies I know I'll watch multiple times.
@joeblevins: Well, you need a membership in that you have to use a traceable credit card. Its no more or less than what Blockbuster or Hollywood video want to see.
@joeblevins: Amen. On top of that, the only times I've had problems, a quick call to their customer service line and I've gotten things taken care of. It's great!
It is the movie industry's fault for putting out garbage in the first place.
Sagara Sanosuke: destroying DVDs since he was put on em. Or maybe he was reacting to the dubbed music for the show?
Honestly, I hate it when I get an anime DVD in the mail that's broken, especially the out of print discs that are going to be difficult to find elsewhere... rentanime is good about that (at least far better than netflix/blockbuster is about it).
@docrice: I have been buying DVDs at Target. Eventually, they hit $5, which is when I buy. I have bought a few at $7.50, but only a few. My reasoning has been that it costs me $5 to rent a blockbuster, so I can buy them for that at Target. Now Netflix has screwed up my logic, but I still buy stuff that I think I may watch more than once for $5.
My only gripe with Redbox (and I suspect this is a cost saving tactic) is that they only stock the basic discs, the ones that have the movie and maybe one or two special features. At least with Netflix, they either stock the special edition, or they give you multiple choices. I watched a movie a few weeks ago and was really disappointed there weren't any special features, and upon searching for it on Amazon, I realized that there was a special edition (it wasn't really rare or anything, just a different version) with three discs. I wish Redbox would at least give you the option of even paying a dollar more for a special edition disc so you could watch special features.
Yes, I'm one of those people who love commentaries and special features.
@pecan 3.14159265: Yes, this is what I do as well. There are plenty of places on the internet that offer authentic DVDs below the MSRP.
But, I am not opposed to the idea of just buying a DVD with ONLY the movie on the disc and nothing else. Sell the DVD at like 5$ and skip all the extras. That's what works for me, I hardly ever watch the special features.
@PinkBox: Yeah I have Netflix and I've never used Redbox. Mostly because they require me to return to the grocery store the next day and I'm lucky if I make it over there once a week.
The sight of a splintered Kenshin DVD hurts my soul. :(
I've never used a Redbox or similar devices. I've scrolled through them, and would likely use them if I didn't already have a Netflix subscription and didn't owe Hollywood Video 20 dollars in late fees because I kept Call of Duty 3 a little too long.
@NeverLetMeDown: The model needs to change, and the studios are just dragging their feet on acknowledging that. The technology is changing, and rather than fingerpointing or whining the studios need to figure out a way to make money off of alternative business models.
Of course, this is the movie industry, which is not exactly the most progressive-minded industry in the world. It's been how many years since the VHS tape was introduced and they're still whining about individuals being able to watch their flicks at their own leisure?
Hmmm...how about Hollywood stops paying their acors and actresses so much money? That could defray the costs a bit! Honestly, millions of dollars for what they do is outrageous!
@dinahcat: The argument doesn't exactly hold water only because there is no standard for how much actors are paid, just like there isn't a standard for how much athletes are paid. We can all agree that they're overpaid, but how are they overpaid, and what kind of compensation is really fair?
Actors don't just sit pretty and talk on the camera, they are roped into countless interviews, press junkets, world tours, and it eats into their time that they can spend either doing another project, or with their families. It's more than just learning lines.
I say this believing full well that many actors are being overpaid, but the majority of actors don't make a ton of money, and have a lot of expenses, like agents. And a lot of actors in theater don't make a lot either.
Do production costs count toward all the costs associated with making the movie? Like paying actors, setting up the set, blowing stuff up, and everything else? Most big name movies pay themselves off if that's the case. Anything above that is pure profit. They need to get over it at this point and realize the world changes faster and faster with the new technologies that are emerging. Just wait until bandwidth caps are deemed illegal and the online movie industry really takes off. What is the movie industry going to do when companies are renting movies for under $1 a day?
@georgi55: Or Bluray, or streaming movies, or netflix, or blockbuster, or bittorrent the evil of all evils? I was going to say On Demand as well but we all know no one watches that crap.
@korybing: I think you need to do a little research before whining yourself.
"The studios" have no issue with people being able to watch films and movies at their own leisure. Theatreowners however are a bit disturbed, but the studios are OK with it as a previous poster has stated that it is on DVD and now BD that they have a chance to actually recoup their money. Studios have even been OK with rentals - just look at the revenue sharing deals that have been so popular - but it's the discount rental companies that are taking a bite out of that.
And if you're not making your money back based on the people who pay to watch the fare you put together (whether it be on sell-through or regular rentals or even EST & VOD), how else can the model be adjusted?
@pecan 3.14159265: But according to that one random lady the other day, WE ARE EVIL and don't care about our communities if we don't get DVDs from our local libraries!!!
@Gokuhouse: Yes. Production costs cover the entire cost of making the movie, including pay, sets, crew, etc.
"DVD sales historically" what? For the 13 years they've been produced, or the ~7 years since they've been ubiquitous?
Apparently, today's history is yesterday's yesterday.
@pecan 3.14159265: When I find a movie I love, I watch enough times so that I can put it on for background noise while I do something else and not even have to watch it. Netflix has definitely cut down on my movie buying (and my cable bill!) though. I don't impulse-buy $5 DVDs anymore of movies I'll only watch once in a while. A lot of them I can watch instantly. If the studios don't want to lose money then they'd better start making more movies that people would want to own, instead of quickly-greenlit, cheaply-made, disposable, Mad-Lib movies with cliched characters and recycled plots.
@PinkBox: The weekend warriors might be better off with Redbox than Netflix. If you're renting one or two movies per week that's only around $4 - $8 per month. Obviously the higher end of that is closer to Netflix' one-at-a-time unlimited plan but Redbox has the benefit of not charging a monthly fee when you're not using it.
All Redbox needs is BluRay.