Blockbuster Feels The Netflix Heat — Ditches Late Fees

from the it-burns,-it-burns! dept

Think Blockbuster is realizing that Netflix has their number? The company that makes a fair amount of its profit off of people too lazy to return rented movies on time has decided to stop charging late fees. It’s not as simple as it sounds, actually. They will rent you the movie with the same return date as before, but you’ll have a one-week “grace period” in which to return it — basically making the return date one week later, even if that’s not official. However, if you don’t return it by that point, Blockbuster will simply charge you for the price of buying the movie (less the rental fee). If you decide to return the movie within 30 days after that, however, the company will credit your account. They’re probably hoping that this will generate more business in two ways: (1) getting people to rent more without fearing late fees and (2) getting more people to simply “buy” the movies by default by never returning them. Either way, it’s clear that someone at Blockbuster realized that keeping things the same while coming up with a lame Netflix copycat wasn’t making much of a difference, and it was time to shake things up. It’s good to see that they got over the mental block concerning just how much money they made in late fees to realize that may be driving away customers, but it’s unclear if this new plan really is going to do enough to replace that revenue or make customers happy.


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Comments on “Blockbuster Feels The Netflix Heat — Ditches Late Fees”

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3 Comments
Michael Vilain says:

LACKLUSTER's service still sucks

I don’t know if it’s just the LACKLUSTER employees at all the stores here in the SF Bay area, but they act mostly like they don’t care or would rather be somewhere else. There’s another chain here called HOLLYWOOD VIDEO that seems to have all the helpful, attentive people.

My mom refuses to use the LACKLUSTER store 3 blocks away because they’ve consistantly dinged her for a late fee when she’s returned a video on time. Or they can’t find the video she returned saying it’s still out. At my suggestion, she saves the receipts, has them signed by an associate, and that seems to solve most of the time. This usually happens if she uses the drop box. But never happens at HOLLYWOOD VIDEO.

When this happened a third time, she asked to speak to the store manager. Ultimately, he recommeneded she rent videos elsewhere. We followed up by writing a letter to their corporate HQ describing the situation, the store, the manager’s name and returning her Blockbuster card cut up. We also asked about the status of the Texas litegation that charged LACKLUSTER with using the late fees as a revenue stream. We never heard a word back.

Now she goes out of her way 10 miles in the car to rent from HOLLYWOOD VIDEO. With no computer, NETFLIX doesn’t help her. But the LACKLUSTER employees are worse than FRY’S associates (a local nerd’s computer store filled with stuff and unhelpful and unknowledgable staff).

Braden says:

Blockbuster

Reading the entire policy, it seems that there is a 30 day period after the movie is sold to you that you can return the movie for a full refund. There is a small $1.25 fee at this point (restocking fee I believe). The bigger problem now is that getting your hands on the new releases is harder because everyone keeps them longer and there has not been a significant increase in copies available.

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