"No More Late Fees" Update

John A. sent in this Washington Post story that gives us an update on the Blockbuster "No More Late Fees" program:

"With the no-late-fee policy we were having an extreme problem with satisfying the customer on movie availability," said Mickey McFarland, director of operations for Capitol Entertainment, which owns franchises in Arkansas, West Virginia, Maryland and Virginia, including nine in Fairfax County. "We did not know when the movies were coming back."

My local Blockbuster franchise (Connecticut) only offered "No More Late Fees" for one month. They charge a small late fee on a daily basis, which is reasonable (they used to automatically charge another week if you were late).

Acccording to the story, about half of the Blockbuster franchises participate in the program (they control 1,100 of the 4,700 stores), but Blockbuster is still optimistic about the controversial campaign:

Blockbuster said that the $250 million to $300 million generated by late fees will be made up by revenue coming from greater frequency of rentals. "The no-late-fee program has performed very well," said Hargrove. "We have said that by the first quarter of 2006, we believe that overall rental revenues will be greater than if we would have charged an extended viewing fee."

Comments

[Moviewatcher_2005]

From a customer standpoint, I enjoy the no late fee policy, which our local BB honors. Being fairly rural sometimes it is real hard to return movies on time.

From a business standpoint, it looks like a suicide move, but I guess we shall see.

On a side note, I cancelled Netflix today after 3 months on the $9.99 for 3 out promotion. I had heard stories they would offer several specials to get me to stay, but in my case at least, they just cancelled.

Kind of disappointing. I guess they don't like me. :-(

[rjejr]

I don't rent any movies from BB but I do get games, and I must admit I am abusing the new policy. I'm not nearly alone however as all 3 of my local stores resemble those Gamefly (?) commercials. All 3 have recently raised the game rental rate to $7.99 - it wasn't that long ago it was $5.99 - so I can see how they might make some more money. Though it would negatively affect me, I honestly think the new late fee policy shouldn't apply to games.

[CJ]

I've been using Netlix since 2000 and would frequent regularly BB for the wait-listed Netflix titles. I abruptly stopped shortly after BB started their "No late Fees" program since nothing even remotely of interest was ever on the shelves. I haven't been back to BB since - so BB permanently lost at least once customer with their innovative "marketing" program.

I contend that BB has an out-moded business model and is heading down the same path as all those brick and mortar music CD speciality stores we used to see years ago.

[Throttled]

"nothing even remotely of interest was ever on the shelves."

That claim is so worn-out and tiresome. I've walked down the rows at BB quickly, and seen dozens of movies that interested me and WERE NOT AVAILABLE on NFLX. If you can't find any good ones, your standards are absurd. (And I don't like most mainstream movies either. So it's not that my standards are bad.) You can find lots of movies. You're just ignorant.

[PlungeBob]

It seems that one issue is customers holding new
releases for a long time.

I learned quickly that I should grab the "hot" new releases
immediately, or I might have to wait a week or so
to find a copy to watch. (ie. Batman Begins)

Really, not a big deal.

[tommy boy]

"I contend that BB has an out-moded business model and is heading down the same path as all those brick and mortar music CD speciality stores we used to see years ago."

People have been predicting the video shop's demise ever since the 1980's. Why don't you get with the 21st century and come up with a new prediction? How about the demise of the internal combusion engine and fossil fuels? That's more likely in the next 20-50 years.

Just watch "The End of Suburbia" if you are dumb enough to think we can go on living the way we are now. You will soon be disabused of that fantasy. Wake up to reality, shills. Video stores will never die, any more than radio died when TV came along, or the horse became extinct when the automobile was made. They all have their place.

[cynthia]

My blockbuster doesn't participate in the no late views program. As a result, I go to Hastings and use netflix instead. Our BB doesn't have the selection these other stores have and their late fees are horrendous imo.