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gir

"Looks like Redbox has told Warner Bros to take a hike with its effort to double the waiting period"

I see this as a stark demonstration of the power the studios have over companies that are shackled to streaming deals.

Everyone keeps saying that streaming is the future, but I think it's only one part of the future, and a fairly small part at that. The only way people are going to get most new releases affordably is on disk.

wbad

Nice to see a company fighting for their customers. If only Netflix did the same.

The fact that Netflix allowed the studios to remove the special features on the discs a while back shows you just how they don't care about their DVD subscribers.

Netflix, if your trying for a great streaming company in the future, then you need to show a little backbone in the present.

Tvaddic

I wonder how Redbox plans to support a streaming service they may have. Why would a studio support them, with this move?

ClydesMP

Uh, do you think Warner's is going to bow down before Netflix for caving to the 56 day window and say, "Thank you, thank you, thank you," and reward them with better streaming deals? You know nothing if you think that. Just look at what's happened already.

Besides the 56 day window, HBO has said they'll (Netflix) will get nothing of their original programming anymore, either for streaming or on discs. If you haven't been paying attention for the past 20 or 30 years, the only thing a corporation, media or otherwise learns, when they have a company by the balls is to then cut them off. Netflix agreeing to this so easily and quickly only makes them look even weaker.

I did have a good laugh over that, "as Netflix is letting the DVD business decline gracefully to focus on streaming" comment. Gracefully? Really? Frankly if Redbox can come up with the Warner discs, Warner will be losing out because Redbox will not only not be observing the new 56 day window, but the 28 day window is off the table as well. Which means any extra revenue Greedy Warner Inc. hoped to pick up from extra pay per views will go bye bye as well. I wish Redbox a lot of luck, and hope they succeed.

Tvaddic

@Clyde
I did not say that WB will reward Netflix, I said that they would not want to support RedBox (who in there eyes is taking money away from them.

Crow550

Looks like Redbox got a big ol red pair of balls.

Good for them.

As for Netflix I will re-post what I posted in Is Netflix Crazy to be Abandoning the DVD Business?:

Yeah there is still several Titles that are on disc and not streaming. Gonna be that way for a long time.

Streaming is convenient just not reliable to get all the Titles you want. DVD was and is that. Or was....

I remember getting several rare Movies I had heard about mainly rare small cult films on DVD. Which are still not on streaming.

So discs shouldn't go anywhere if the streaming won't grow fast enough and it can't. Not for many, many years.

It also seems like maybe Qwikster should have happened? As now they are like: "You don't want Qwikster? Fine then the disc rental service can rot." Pretty much.

We all bitched how Qwikster would be so awful because of separate Queues even though Netflix could easily add a notification of Titles on both so we could see if we had Titles in the others Queue already.

Last I checked Blockbuster's disc service still carried many more Blu-Ray Titles than
Netflix. Both seem to have some Titles the other doesn't though.

Currently Netflix & Blockbuster are the last major cataloged disc rental services with a wide selection to choose from unlike Redboxs limited selection.

Streaming just isn't there yet. It's awesome for TV shows though.

It still doesn't have the big selection of Titles that disc rentals tend to have. Or quality of Blu-Rays.

It's simple why that is as it's easier to go and order a bunch of copies on disc than it is to secure the streaming rights. It's gonna be like that for quite awhile too.

It seems the two still need to complement each other. Were still not there where one is really better than the other.

When Netflix charged for just discs by mail and streaming being an added bonus it was killer.

Even raising the prices was annoying but at least they kept getting discs in.

Now that they are favoring streaming they are mucking up there business as they are doing it too soon!

However as a consumer you have the option to mix and match services or move on to others if the current one isn't no longer up to snuff with your likings.

Those plastic discs are still valuable for getting all you can watch content in your Home and should still be complimented with streaming as they both work hand in hand.

Crow550

FYI Blockbuster doesn't have a 56 day wait either. I believe Dish has put more effort into the Shipping centers delivery too.

So consider using them for discs and Netflix for streaming. As well as Redbox for the Newest releases.

You have options.

Crow550

I meant Redbox for those instant New Release rentals if you can't wait for it to arrive in the mail.

3 services you can mix and match for the best of both worlds.

Nate

Good luck getting the WB titles from Redbox. Seriously, kudos if you can because it's gonna be hard. Redbox employees will have to store hop and buy them retail. They did this in the past and stores quickly put into place caps (5 being the most common). Redbox might have WB titles, but I wonder at what levels they will be able to stock them.

Crow550

Wait, wait, wait.

Can't they just order the damn discs online?

Why goto retail stores? No really, why?

They can goto www.dvdpricesearch.com and goto town getting all the discs they need.

Much easier than retail. Why the funk would they goto retail stores? Getting them in online shops seems easier? Am I wrong?

Pat

Good for Redbox. Hopefully sales for WB movies will not be dramatically increased and they realize people don't care to own but rent.

Chris

Yay to Redbox. Apparently Coinstar sees this for what this is and knows how their bread is buttered. I think they should stay out of streaming and concentrate on disks.

They will have a lock on this business as NF has given up on disk and BB will be their only competition left if they can market their unlimited disk plans right.

This is terrific that RB is exploiting their non reliance on streaming agreements. NF will go down the tubes as they are bought out for their best in class delivery (with lousy content) by someone else (probably Amazon I would think). Amazon will evolve more and more to an Itunes model with the prime stuff going indy/non studio for cost containment.

This is how I see it at least

Gran

@Crow550 - Redbox thrives on offering new releases on the Tuesday of release. If they order online, they will not have them in their box on Tuesday release day.

Robert Emmerich

@Gran - if they order them w/ Prime from Amazon they can get it the day it comes out. Actually they might not even need Prime. Or Amazon.

I've read that headline 4 times now and it still sounds like nonsense.

That chart that reads: Redbox - NEtflix - Rental Stores. Anybody know where all the other kiosks - BB, DVDXpress etc. and other rental websites would fit in? And libraries. My library lends a ton of DVDs.

Gran

Even Amazon Prime won't be able to supply them with all stock they need. It will need to come from many sources across the country. Most of the big box retailers have studio imposed limits installed (as one poster said above). To hit the Tuesday drop date, they'll need an army of buyers at retailers on Tuesday morning to buy all they can in as many cities as they can. And then quickly stock the machines, Will be interesting to see how well they're able to keep stocked. History shows, The Studios always win in these battles.

Don't Trust BB/DISH

Does anyone remember the last company that tried to stick it to the studios by not abiding by the 28 day wait? Their name was Blockbuster and and was the final straw that led them to file for bankruptcy. It's simple business principles, DVD rental companies do not produce their own content, they license it from the individual studios. If they want to run a successful business they make friends with these studios and work WITH them. Bad business is to ignore those vendors and expect to have a long-term relationship with them. Give it time, Netflix has proven it is here for the long-run and will do what it needs to make sure they stay competitive. If you're that impatient to see a new movie why didn't you go see it in the theaters in the first place? It's all a matter of money people, choose your price point and stop bitching.

byteme

Heck, why should Redbox kill itself trying to stock their machines on the day the movies come out? I would allow three days to purchase, label and repackage the discs. This may delay the availability until Friday, but 3 days is way better than 28 or 56. Plus, some movies are released on Fridays anyway, so the consumer wouldn't be too inconvenienced.

They could either just quietly add the movie on that Friday, or if they wanted to "protest," they could add a "coming Friday" message on Tuesday, with an explanation that the delay is due to WB's refusal to sell directly to Redbox under reasonable terms.

jheartney

This really comes down to a business tug-of-war, and who wins will tell us who's calling the shots.

I have no idea who will win, but I wouldn't necessarily bet on the studios; customers will eventually decide, and if Redbox can make enough money to justify their effort, the studios will just have to suck on it. And if Redbox can make it stick, then eventually Netflix will demand the same deal from the studios, and will be in a good position to make them back down.

Being a hard-ass isn't necessarily the best default business practice. Just ask the record companies, who hard-assed themselves into irrelevance.

Truck

Redbox just has to buy from another distributor and not get cut rates from the studio itself. It's not that big of a deal. The biggest advantage here is that both Blockbuster Express and Netflix and Redbox were buying exclusive rights to rent out discs for the first 28 days (BBX charged $3 instead of $1 for those titles). Now that Redbox isn't playing the game anymore, those sweet deals won't mean much.

Crow550

I just did a test at Amazon and added some new Warner Titles and entered the max amount for each Title of 999 copies.

It worked just fine.

I doubt online retailers will crack down like retail stores as retail stores don't have access to as many copies as online warehouses do.

Wal-Mart.com is even different than the retail branch of stores.

So Redbox will do just fine.

Nate

Crow: If big companies like Target/Walmart can be squeezed by WB, have no doubt that if proper pressure is applied Amazon won't bend either.

http://www.businessweek.com/technology/content/feb2010/tc2010022_125668.htm

Laz

@Nate - That article is two years old. I hadn't even heard of Redbox then. I couldn't find any more recent news articles related to this, but I wouldn't be surprised if these retailers have since realized they should just increase their orders for these titles rather than impose purchase limits. If nothing else, they can negotiate with Redbox where their buyers should go. What does WB have to offer? It's not like they're going to threaten top sales retailers with an availability delay.

Nate

It's 2 years ago because that is the last time there was a contract dispute about delivery windows. WB is either number 1 in market share or no. 2 every year, you would be surprised what type of pressure they can apply. Again, if this was "easy" solution for redbox why would they have agreed to the 28 day window to begin with? All I'm saying is, I have serious doubts they will be able to supply the needed number of DVDs with WB completely out of the loop.

Crow550

Does it matter if they can't? I'm sure they can just not on release day. Maybe a week later. Still better than waiting 56 days right? That is if you can't wait 56 days.

Not trying to pimp Blockbuster online just pointing out they still are able to get away with not having any delays even after being owned by Dish. So they are worth a look. Especially for Blu-Rays at no additional charge.

Or if you don't care than stick with Netflix.

Again why not mix and match services too. Get the best of both worlds.

;)

moviegeek

Blockbuster by-mail service has gone downhill since Dish took over, they can take over one week to mail a disc. The reason they have no delay is they share revenue with the studios.

LeapPad Reviews

56 days is crap! Yeah, there is lots of piracy, but there always will be that cat and mouse game. Didn't iTunes teach us that if you make the content more accessible and affordable, people will pay for it vs stealing it?!? This 56 day delay is making it less available, from less sources.

David

I've talked to employees at our local blockbuster about this.

The purchase limit is a lie. At least around here. Walmart lets them buy as much as they want.

Maybe they are telling the studios one thing and doing another.

Blockbuster, like Redbox, has the newest films from WB and a LOT of them, the day they come out. I know, I have a blockbuster in-store pass as well as my netflix account.

Crow is right on this Nate. I know because I know the people actually going out and buying the DVDs and putting them on the shelves.

The bigger inconvenience is having to print or make custom covers to go in the Blockbuster boxes.

The studios aren't going to win this one. They didn't bank on someone as big as Redbox sticking it to them.

This is similar to the reason movie cinemas (which used to be owned by individual studios back in old black and white days and palace theaters) broke up and became what they are today.

Consumers WILL get what they want. Bottom line. Every time.

Yobagoya

Blockbuster tried to avoid the 28 day delay before, then they went bankrupt. Hope it goes better for them this time.

ClydesMP

The 28 delay had little to do with Blockbuster's downfall. They were in trouble long before that, mostly because they waited too long to acknowledge Netflix's presence and that it would be a real competitor. Then when they did decided they had better take action, they made it worse by practically giving away the keys to the store by offering a DVD plan where you could trade ALL of you online rentals in at the store via a one on one plan, while you're new mailed ones would still be shipped out, at a price less than even Netflix's rentals. In essence, they were giving away the store rentals for free. And after about three or four months and losing a fortune, they ended the program and customers who had joined simply because of that offered headed back to Netflix.

Nate

Sorry David but because you know a guy doesn't mean I'm gonna take your word over the multiple tech blogs/sites I have read from in the past. Again, if this was an easy/simple solution these guys would have never agreed to the 28 day window to begin with. 56 days and they are willing to risk this method of delivery, but it is a risk, thus why they haven't been doing it all along. And your comparison to cinemas is wrong, if you can't beat them, join them. That's exactly what they're doing with Open Road Films. Movie Theaters have been losing the fight for years, which is also why Netflix is getting into show production also. Again, WB is either No. 1 in market share or No. 2. The can bully people a little bit, other smaller studios cannot.

Former Netflix Employee

How many copies did you attempt to buy on Amazon? 999? hmmmm...because the standard order for Netflix (and Redbox is probably maybe half of this), is about 400,000 copies. Where are you going to find those in a cost effective manner?

If you can buy that amount at $5per from the source, or buy it at $14.99 retail, which do you think makes more financial sense for the long-term growth of your company?

Sometimes, when a company like Warner is married to a retail mark-up plan for their profits, they will desperately do things like this to keep the status quo.

Former Netflix Employee

BTW: Good for Coinstar in doing what they feel is best for their business with Redbox. They are well aware that in a year or two Redbox will be like owning a beeper store, or VHS library, so why not make yourself more appealing in the short term? That's a smart way to go for them. This has ZERO effect on the Netflix plans, and only a moderate (but not long-term) impact on Blockbuster.

Crow550

@Former Netflix Employee

That's like per order though. So they could get that amount I'm sure by placing more than one. Yeah they will have to pay full price per disc. Like what $20 or $15 a pop.

I'm not Redbox. That's there plan though.

Whatever Redbox does and how they do it is there thing. Well see how this pans out.

bigqueue

Don't Trust BB/DISH said:
>DVD rental companies do not produce their own content, they
>license it from the individual studios.

They don't have to license it. That's the whole point. Through the First Sale Doctrine, if someone buys the media, they are legally allowed to rent it (with one major exception - computer software). That is not true for streaming, because obviously a separate copy is being made.

Netflix and the other places are WILLINGLY getting into agreements with the movie producers for free/cheaper discs (free in exchange for per rental fees, I'd presume).

Former Netflix Employee

@Crow55 - That's rough but great for Redbox...very expensive, and definitely cuts in to their margins, but still gives them a leg-up in the court of public opinion. Its risky, but they're also a business with a finite presence, so take what you can while you can. I applaud ballsy moves like that.

@bigqueue - You did a great job of explaining the Right of First Purchase. Netflix enters in to those agreements in order to access not only the titles in question, but a vast library of titles (back catalog) and future considerations. Since the DVD business is doomed to obsolescence, it makes perfect sense to secure a good working relationship with content providers as you prepare for a streaming only world. There are consequences in the short-term for DVD only customers, but it is essential for the growth of the business moving forward.

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