Movie Rental Outlets Closing

[nakedgord]

Blockbuster just started a $10/month catalog rental service with 1 disc out at a time.

Considering this beats the pants off Zip.ca etc prices with the chance for many more discs I'm wondering if this is a good model for stores to consider.

If the store is within a residental area (walking distance for me) and there's a decent number of OTA'ers I could really see this as a new model for the local video store.

[Angela V]

Isn't the Blockbuster deal for the Favorites which aren't new releases?

[David Susilo]

that is correct. It's just for old movies only.

I don't understand. In the olden times when a VHS copy was $80+, I can understand stores charging $5 for rentals. Now that their cost is only $20, I don't understand why they are charging $6 for rentals.

Who is going to drive to a rental place, drive back home watch the movie once, drive back to return the disc and drive back home for $6 + time + gas + possibility of the movie is out when someone can just deal with PPV (not the Rogers kind, which are mostly only in 2.0) for the same amount? Thank God for my AppleTV.

[frisky]

Lots of people getting movies from our local library. The place where I work has a library on the first floor of the building which makes it very convenient.

Slightly older movies I can keep for a month. Can't beat that!

[JamesK]

Now that their cost is only $20, I don't understand why they are charging $6 for rentals.

Initial purchase may be the least of their expenses. They still have to pay for the store & staff.

[David Susilo]

I understand that part.

But if they can survive when the price of VHS was $80 and charging the rental for $5 (and at the time they had literally at least 2x-3x more staff), they should be able to charge the movie at $3 when the disc is only $20 with a shelf life almost an eternity (no wear and tear compared to VHS tapes) and literally only 2 staff (3 max... at least in my area) plus a shrinking store size and selection by about 50%.

[KRD01967]

and they sell them off as previously viewed...

[David Susilo]

^ usually at $14-$20 (which is 100% of their initial investments) unless when they have the ocassional 2 for $15 and 2 for $10 sale.

[cfraser]

^ I think their "initial investment" for DVD/BD rentals is a lot more than we think i.e. not to be directly equated to our consumer purchase prices. In the way that bars etc. don't pay what we do for the same TV services. Perhaps somebody who actually knows or is in the biz could chime in for our (my) edification/curiosity...

As far as selling off the pre-viewed titles really cheap, I suspect they get permission to do so with certain titles at certain times. In that I notice that most of the cheap titles typically have much-lowered NEW prices in B&Ms at the same time. IOW it doesn't appear to me to be just random getting rid of "old" stuff. OTOH, they sure have a pile of crap titles for sale that I can see not being of much interest after the initial "new BD" rental surge.

[David Susilo]

I don't know about BD, but during the DVD days, they pay the exact same price as wholesaler but they do revenue sharing which is a flat monthly fee.

[cfraser]

^ I see. So, in that case, would they have to share less revenue just because they have fewer copies of something? IOW selling pre-viewed stuff could be extra beneficial to them. Or is it like for lots of music stuff, they pay a flat rate just for their existence as a (video in this case) distributor, the $$ goes into a kitty, and it gets distributed however (usually totally inappropriately in Canada)?

[David Susilo]

that I can't answer, I only know that a rental place during the DVD days pays a flat fee. Whether it's based on how many copies on hand or a flat fee (regardless of number of copies), I don't know. Logically it would be to former.

regarding the music royalties (at bars etc) and media levy. As a registered (and active) SOCAN member, I've never seen a single cent from those. I get more royalty $$ (albeit very tiny due to my lack of activities in the past 12 years) from BMI, ASCAP and KCI.

[cfraser]

^ Sounds like what I've heard from others re SOCAN, where my snarky comment came from. And the film performance side too in Canada; unless you're a "biggie" and can negotiate otherwise, the rules don't give you much at all.

[MarcP]

Originally Posted by David Susilo

that I can't answer, I only know that a rental place during the DVD days pays a flat fee. Whether it's based on how many copies on hand or a flat fee (regardless of number of copies), I don't know.

You're referring to Blockbuster's "Guaranteed Rental" program and I'm pretty sure it was on VHS only. That didn't last very long as it didn't work out well for BB.

[David Susilo]

it was also on DVD for sure (because I never rented VHS ever, I went from LD to DVD).