The Studios are Attacking the Little Man Red Box Now
Posted by Craig on February 9, 2010 at 2:30 am

The movie rentalwar has always been seen as a 2 way battle between heavyweights Blockbuster and Netflix. But there is another up and comer who has made strides in the niche and has won over the hearts of many. Red Box releases movies from kiosks for $1 and can usually be found in many local grocery stores and Wal-Mart’s around the country. The low price and general convenience of having the kiosks where people generally shop anyways makes it easy to rent from without the cost of a monthly subscription.
Things may be changing though with Red Box. On February 1, 2010, Wal-Mart put a 5 limit cap on new release purchases at a time. This may make things very different for Red Box to keep new releases stocked in their kiosks. In the end, this could end up really hurting Red Box from succeeding in this large and very competitive industry, especially if more restrictions are made.
Why?
Studios are putting more pressure on rental companies to delay the release of new movies to rental services. Warner Brothers delayed new releases with Netflix for 28 days, and rumors are more studios will follow. With decreasing DVD sales, studios are looking for ways to boost sales. If rental companies are limited to the amount of new releases, especially in the kiosks, then the studios will end up lowering the selling price of DVD’s in an attempt to lure those customers into buying the DVD’s instead of waiting.
Personally I think that’s a load of crap and a small decrease in a DVD is not going to suddenly grab a consumers attention to make them buy it. Especially if they already have a movie subscription or love the convenience of the local kiosk in their grocery store. Why would a consumer spend close to $20 instead of just waiting a month and paying $1 at Red Box? They won’t.
But while a lot of people use Netflix to rent older movies with their huge selection, Red Box is mainly filled with the newest releases. Any restrictions could jeopardize the company and slowly push them into being extinct which would be bad for the consumer. Hopefully Rex box could push through and figure out a way to stay afloat and successful and grow their name in the marketplace.
Do you use Red Box? What do you think about the restrictions limit on new releases?
STUMBLEUPON
REDDIT










