Studios To Separate DVD Purchase and Rental Release Dates?

Published 5 years ago by

bb rb nf logo header Studios To Separate DVD Purchase and Rental Release Dates?

Ben Fritz, a writer for the LA Times, reported the other day that the major studios are considering spreading out the time between when consumers can buy DVDs and when they can rent them. As it is right now (and has been for years), movies are available to rent the same day that they can also be purchased. According to Reed Hastings, chief executive of Netflix, he has recently met with several of Netflix’s biggest suppliers (read: studios and distributors) to discuss a “delayed-rental proposal.”

The current DVD release system has DVDs available for purchase and rental on the same day from companies such as NetFlix, Blockbuster and RedBox. Under the new DVD release system, those dates would be separated by a few weeks. What is the reasoning behind this move? Studios cite a sharp decline in DVD sales. Said Hastings:

“The studios are wrestling with declines in DVD sales while the DVD rental market has been modestly growing. One of the mitigating steps some are considering is introducing a DVD retail sales-only window for a few weeks.”

reed hastings Studios To Separate DVD Purchase and Rental Release Dates?

The faltering economy has families and individuals looking for ways to save money, not spend it. One of those ways is to rent DVDs and not purchase them; a theory that is backed up by NetFlix’s recent quarter numbers of 24% growth! That is a truly impressive financial achievement in this harsh recession; an achievement that surely has investors smiling, but not as impressive as rental company RedBox’s growth. RedBox saw a staggering 113% growth in the first six months of this year!

Those sorts of numbers where the reason that studios 20th Century Fox, Universal Pictures and Warner Bros. all attempted to keep RedBox from having access to their DVDs until well after the initial release.  The popular rental giant only charges $1 per night, per rental, and the studios felt RedBox wasn’t charging enough for people to rent their movies. Of course, RedBox responded with a lawsuit to keep that from the studios off its back and the suit is still in court…although the point may soon become moot.

The new release system could go into effect as soon as next year and if that happens, every rental company will be affected, not just RedBox, and I would suspect the suit would be dropped by all parties involved. Said a RedBox corporate spokeperson:

“We must have a level playing field and the right to buy movies at the same time as any of our competitors.”

Ben Fritz makes the following statement in his report:

“Hollywood studios prefer that consumers buy DVDs because that generates significantly higher profits than rentals.”

And Wade Holden, an analyst for SNL Kagan, gives this insight:

“The studios might try to implement something like this to increase demand for sales because they need to protect that revenue stream the best they can.”

Does that statement strike anyone else as extremely greedy? I understand movie studios are a business aiming to make money for both themselves and investors; I’m not arguing that point at all. What seems ridiculous to me is their business model and the idea that pushing back rental dates will make consumers buy a movie because they don’t want to wait another three or four weeks to rent it.

(Are studios getting greedy or getting their due? Keep reading…)

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  1. This is stupid. Some movies are only worth renting and not owning. And some movies that you didn’t get to see in the theaters you want to rent first to see if it is worth owning. With that one they will be delaying some people before they decide to go buy it. I say they are getting greedy.

  2. If they let us rent them sooner, that would be great. The wait between movie in theaters and movie on DVD right now is just too much and I’d say that’s part of the reason ppl go to other “illegal” sources to get the movies.

  3. Ok, so before when Fox wanted to do this with their movies, everyone called them the typical big evil corporation. I guess all the studios are now huh? Oh well…

  4. Well, I won’t buy a DVD any sooner or be more LIKELY to buy one with this arrangement in place.

    If it was a rental before, it will be a rental after. I’ll just end up renting it a few weeks later than now, is all.

    Those that I WANT to buy, I buy.

    I suspect the studios are shooting themselves in the foot.

  5. BU!!$H!T..THat’s all…This is about trying to soak people who buy DVD’s by making them wait so that they will rent and then buy the same title later…

  6. Well, if you’ve been waiting for months since the movie was in theaters, what’s a few more weeks? If I’m going to buy it, then I’ll buy it. If I’m going to rent it, then I’ll just rent it, whenever that may be. I can wait. I have 75 other movies in my Netflix queue, so what’s the rush?

  7. This will definitely NOT force me to buy the DVD/Blu-Ray instead of renting it. Right now there are only a couple of films a year that I MUST buy when they come out for Blu-Ray release and the rest are rentals from Netflix. IF I like the film, I will eventually buy it, but when it’s price is down to a more resaonable $15-$20 (for Blu-Ray). IF the studios drop the ridiculous initial prices for the releases, they MIGHT sell more Blu-Rays/DVD’s and recoup the lower price point with more units sold.

    Like Ronda said, if it’s a rental it’ll still be a rental in 4-6 weeks. Not like there aren’t plenty of movies on Netflix to choose from in the meantime.

  8. First of all, I think the studios need a bit of a legal refresher:

    http://en.wikipedia.org/wiki/First-sale_doctrine

    Now maybe they want to negotiate some voluntary delays with the top dvd rental outlets, but that smacks of anti-trust violations.

    Wouldn’t affect me much anyway. I’ve waited months to see the dvd, I can wait a few more. It’s probably way down on my queue anyway.

    From my habits, this will only cost them money. If I’m going to buy it, I’ll buy it. If I’m not sure, then I’ll rent or borrow it first. By delaying my rental, they can delay their chance at my purchase.

  9. ogb i tottally agree the wait is to long bewteen theater and dvd. its so true paul young u nailed it on the head couldnt have said it any better. I have to say i only rent at redbox now bc of the prices of course and the convenince factor. id say i spend around 5$ a week on movies now instead of 20$. but i would pay more for a movie say 3$ max. but if the dvd came out on way sooner i would pay at least 8$ i mean who wants to go the theaters anymore. allways someone talking or eaiting loud drives me crazy so i prefer to wait and watch the movie in peace in quite in my own home theater. if they offered the dvd for rent like 2 weeks after it came out to theaters i would pay the same price for a ticket. I think that theaters need a drastic make over its the 21st century people.

  10. this is definately driven by greed, but they are businesses they should be. The problem being though I just don’t think that this is going to benefit them. When a movie is released your options are to not watch it, rent it, or buy it. if you take away the rent it option for a matter of time, I think if they were not willing to buy it before, then they will still no tbuy it if that is there only option. Then by the time the movie is rentable it has lost the orignal appeal it had and the people have lost interest in it. The movie industry is is over estimating the attention span of the general public.

  11. So all they want to do is make dvd available to buy, then a few weeks later you can rent them ? Well I’ll just wait a little longer, because I rant movie that I don’t want to see in theater. Waitting a little more won’t affecte me.

  12. Its only a slap in the face if you rely on renting over buying.

    There’s only maybe 7 films a year I see in the theaters the rest I wait for the dvd to come out, get kicked around a bit then go on sale used for $4:99.
    If I still care then I buy it used and watch it when I want, or have the time.
    Right now I own over 50 dvd movies/tv shows that I haven’t even watched yet… I enjoy visiting the small Dvd/Music store here in the Valley and that’s when I pick out the latest in dvds. Netflix, Blockbuster can bite me as I support the little guy and have it my way,,!!

    If the Studios want to make back the money they see as wasted in the dvd market then drop the price on NEW dvds.
    Its that simple. All the other tactics are going to have lackluster results, and hurt the bigger rental outlets. Lol!!!

  13. @790 – If I ever get to your town I’m totally looking you and hanging out with you. Our conversations would be epic lol.

  14. I don’t buy many movies anymore but if they want to do this who are we to say they can’t or shouldn’t? It’s their business, their movies and they should be free to do with it whatever they want.

    I can wait a few more weeks after a movie is out on DVD to see it. Heck I usually have to wait a week or two on Netflix anyway because it is in high demand.

    I don’t see how they are shooting themselves in the foot, as someone posted earlier. People who want to buy the movie will do so, those who just want to rent will continue to do so. So in the end I think it has next to a 0%-5% effect on their DVD sales.

    When people don’t have the money they don’t have the money. A few weeks to wait for a rental will not change that.

  15. Haa. Haaa aa,!!!
    I see you coming Paul, you just want to borrow my dvds!!

    ;-)

  16. Before Netflix I was hosed way too many times buying movies before actually seeing them. Now I can rent the movie and if I like it I will buy it, when it goes on sale. :-) I can wait a few extra weeks, as others have said, we’ve waited this long right?!

    I understand the need for profits but to make profits you have to make something people will want to buy. I don’t want to buy crap, plain and simple, and some movies are complete crap.

  17. I can’t believe that people are complaining about the time it takes for films to be released on DVD after their run at the theaters. 6 months is nothing, considering that they usually add all the extras on there as well. Remember when it was over a YEAR before the movie was released on VHS or DVD? How long was it before Star Wars was released on VHS in the 80′s? YEARS I believe. I don’t mind waiting 6 months or so for a DVD or Blu-Ray that is loaded with extra features (although I usually only check out deleted scenes and some of the making-of features).

  18. I think that in the case of TV show boxsets, it would work better if the studios allowed only the first disc of a set to be released for rental two weeks earlier than purchase was offered. That way you get a taster of what you are interested in and perhaps missed when originally aired, then buy the whole set if and when you get into it. Try before you buy is why piracy is so popular. Let the goods sell themselves and maybe even reduce the price of the DVD sales by a percentage based on a previous rental.

  19. I’ll just wait the extra weeks and continue to rent. I don’t go to the theaters to watch the movies in the 1st place, so waiting isn’t a problem. Unlike music, I don’t rewatch movies with great frequency, so if I buy a movie, it’s because it is an important release to me, not just another creation flung out by the business. As a business, I’d said to them, wake up to the new reality of the tech boom, on demand services and multiple sources of entertainment. The waiting game is something the consumer has home court advantage these days. Add too much time and lose interest, in even the rental phase.

  20. I personally buy a dvd after I have watched a movie and I know its worth buying. based on a trailer I am tempt to rent 1st not buy. No one will pay $20 to just watch a movie and then learn if their investment was worth buying it or not. I rent a movie for $2, I love the movie, now I decide to buy it for $20, it cost me $22 knowing that I made a good investment vs spending $20 on a movie knowing you made a bad investment. Not every one is smart but majority of people can think this way which won’t help the studio to cover up their losses or even make enough profits.