Redbox Caves To Warner Bros., Will Delay New Movie Releases From Kiosks

from the dumber-and-dumber dept

Some of the movie studios (admittedly, not all of them) have been on a braindead fight against Redbox — despite the fact that Redbox had created a service that people liked and were paying for and that generated revenue for the movie industry. There are still ongoing lawsuits, but today came the news that Redbox caved to Warner Bros., on the most important point: delaying the availability of new release movies until 28 days after the release. Yes, this is the same deal that Warner Bros. convinced Netflix to agree to last month. Basically, Warner Bros. is telling people to either not rent its video or to download them from an unauthorized source.

The whole thing makes no sense at all. Warner Bros. mistakenly thinks that if people can’t rent a particular DVD in the first four weeks of release, they’re more likely to shell out money to actually buy the DVD. This is Warner Bros. pretending that it can influence customer behavior by denying them what they want. That’s a strategy that has never worked well. What this means is that at the moment when Warner Bros. actually puts some marketing effort behind the DVD release, that movie will not be available from the most popular rental options. And, the bizarre reasoning put forth by Netflix that this would benefit customers by improving inventory and availability of movies is not seen in reality. So rather than pissing off some customers because a movie is not available, you’re now pissing off all customers by making the movie not be available on purpose, and then effectively massively increasing the amount of time they have to wait to see the movie? Does no one at Warner realize that a lot of those “customers” will simply decide to go see other movies or to download an unauthorized copy instead?

Based on Warner Bros., logic here, why release movies at all?

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Companies: netflix, redbox, warner bros.

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Comments on “Redbox Caves To Warner Bros., Will Delay New Movie Releases From Kiosks”

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Marcus Carab (profile) says:

Based on Warner Bros. logic here, why release movies at all?*

Hehe, excellent point! If reducing availability of a movie will cause people to spend more money on it, then it follows that by simply not releasing movies people will offer infinity dollars to get their hands on them.

You might be up for a job at Warner Bros. Mike!

* Unnecessary extra comma removed from quote for your reading convenience 😉

Anonymous Coward says:

Does this new window make it a better movie?

I like the fact that Redbox negotiated a lower wholesale cost for the DVDs on the basis that they will also destroy instead of selling them after the new rental window.

I really hope they have partnered with a environmentally conscientious company like to recycle all those unused, shiny Warner Discs.

Michael (profile) says:

Re: Re:

I think this is a really good point. How many times have you seen a preview for a movie and totally forgot about it by the time it really comes out.

As for never releasing movies, that sounds like a great idea. Warner Bros. through infinite scarcity could whip up a frenzy of consumer anticipation by never releasing movies. Now that would be a captive audience…for someone else to sell their product.

sehlat (profile) says:

Re: Re:

I quite agree. With so much going on, both on and off the net, the *ONLY* market they’ll get to buy is the “just gotta have it” crowd. Many of the rest will stick movies in the Netflix queue (external memory) and let them show up in the stream whenever.

The rest are lost to both the studios and, sadly, probably Redbox.

But… the whole point of this exercise is to force people to *buy* see-once movies? (walks off laughing like hell)

Brian (profile) says:

10 years+

So after perhaps 10 years of anticipation of not releasing a movie they could charge maybe $1000 a copy, I mean its a really long time so by not releasing it for X amount of time then the money people will pay should go up continuously for ever and ever. So after 20 years people should be willing to pay maybe $3000, and after 30 years $9000. I mean they don’t say how much money the people will want to shell out the longer they have to wait so these numbers mixed in with their failed sense of logic make perfect sense.

Jeff Rife says:

Re: 10 years+

Isn’t it funny that when home video first came out, there was a similar “window” with those releases.

In that case, the tape was released at very high prices (say $100) so that only people intending to make a profit from the purchase were able to buy. Later, the price was reduced so that regular people could afford to purchase for their own private use.

There was nothing that stopped people from buying early at the “rental price”, and for very popular movies, it wasn’t uncommon.

The reason the studios did this was because they understood the first-sale doctrine, and merely used natural economic forces to attempt to make a profit. Today, they have forgotten how to do this, and insist on strong-arming anyone (rental outlets, movie theaters, etc.) who dreams of making some money from using the studio’s “hard work” in a perfectly legal way.

Hephaestus (profile) says:

Years back I read a book ...

The book was called the art of war. As an exercise I tried to use it to see if there is any ancient wisdom that could be used to save the media distribution industry. There really isnt. The simple reason is that the entire book is being used against them inadvertantly by to many people (read everyone on line).

There is also the simple fact that every media distribution company is doing everything they shouldnt be doing to try and win the battle (short term profits) and not the war (long term profits).

Its very scary when you think about it in those terms.

“When you engage in actual fighting, if victory
is long in coming, then men’s weapons will grow dull and
their ardor will be damped. If you lay siege to a town,
you will exhaust your strength.”

Funny if you think of the town being the a village of 1 billion people, and the army being 50,000 record company employees.

REM(RND) (profile) says:

Well, there goes another good thing...

Now that Redbox is forced into this deal, they are going to lose some more revenue. Here’s how. I’m too poor to afford seeing movies in theaters. So, I rely on Redbox to be able to rent them (local video store is both more expensive and has smaller selection). If I rent a movie and I like it, I usually end up buying it. Now, here’s where the trouble pops in. When a movie is just released BestBuy and Walmart have the price lowered right away for the first week or two (don’t quote me on exact time). NOW when I rent a movie, if I like it and want to buy it it’ll be back up to full price since it’s a month after the release. Then I’m forced to wait for it to be in the $5.00 bin until I can get it. By then, I doubt I’d even remember the movie exists, let alone want to buy it at that time.

The movie studios behind deals such as this must be brain-dead to not figure this bit of economic madness out. It’s stunts like this that end up causing people to go to file-sharing sites to download the movie. If the movie industry can’t do anything smart, they should do nothing at all and leave everything as it is instead of making things worse.

John Doe says:

No big deal...

It wouldn’t matter to me if it was 28 days, 56 days or 74 days. I put them in my queue and watch them when they become available. No amount of delay is going to get me to buy the movie.

I wonder if the industry has every surveyed people to find out if renters ever buy? I rent like crazy but never buy. Ok, I have a few movies, but very few. So it seems like there has to be many more like me which means you have two types of customers, renters & buyers. Seems they should be serving both types instead of trying to force only one type.

Mark S says:

sale date/ release date

The 28th day will simply become the actual release date to renters and the original release will stay the same for the few that buy. Like anything it will become the norm not the exception as how you view it. No one is going to buy a movie from this that wouldnt have bought it before. The same as holding out the release date never pushed anyone into theaters those who wait wait, and always will.

Joe Movie Consumer says:

Dumb Ideas

Sorry to tell you WB, but I know which movies I’d like to buy by watching them first, either in a theater or by renting it. Waiting a whole month to rent a movie will not make me buy it before then. As was already pointed out, it will actually make more likely that I’ll just forget about it.

Dumb Idea.

NPGMBR (profile) says:

I Just Don't Understand Your Thinking

Maybe its just me but I just don’t understand the writer’s reasoning for saying Netflix and Red Box’s compliance is stupid.

It makes me believe that the writer has ZERO basic understanding of copyright and intellectual law. Netflix and Red Box DO NOT own the content. That means they have no leg to stand on in court. I mean really… won’t hurt Netflix and Red Box to hold flix 28 days one bit because if the movie was that damd good the consumer would likely have seen it in a theatre.

In addition, the writer seems to have forgotten that the studios likely have contracts with the cable companies as well as distributors such as HBO. The studios charge HBO, SHO, Cin and others to carry those flix and allowing Netflix and Red Box to compete with HBO etc. means they don’t get back that higher premium they would get when HBO and/or your cable company charges you five bucks to watch a single just released flick on-demand.

Alan Gerow (profile) says:

Re: I Just Don't Understand Your Thinking

When they purchase a DVD, they legally own the DVD and can do with it as they please (short of duplicating it for commercial gain … that’s “bootlegging”, or displaying it to too large a group of people on too large of a screen … that’s a “public performance”), including renting it out.

Copyright does not apply here.

Valkor says:

Re: I Just Don't Understand Your Thinking

You appear to be new here, so I’d like to be the first to extend to you a warm techdirt welcome.

Around here we look at other parts of the law too, not just copyright. We consider how consumer protection law, like the right of first sale, interacts with “IP”. In this particular case, once Netflix or Redbox *buys* a *physical* disc, they can do any darn thing they want with the *physical* disc.

The points regarding cable broadcast are entirely irrelevant to the subject at hand. Search for the phrase “felony interference with a business model” for additional background information on this blog.

Thanks for coming, and we hope you’ll stick around.

Anonymous Coward says:

Probably nobody who rents from Redbox would have noticed anyway. Since they’re usually in the lobby of Wal Mart most of their customers stare at them like Neanderthals discovering fire.

When you return a DVD to Redbox, you have to put the disk in the case with the barcode facing a certain way. Then you have to put the case in the machine facing a certain way. There are a maximum of four ways to put the DVD in the case and the case in the machine. I stood behind an Einstein who put the case in the slot SIX TIMES without success before I gave up and left.

If someone is standing in front of the Redbox, go someplace else. You will never get the chance to use it.

Andres (profile) says:

Behind the Scenes

Even though I agree that WB may be shooting themselves on the foot I can help but think they may have some ‘Machiavellian’ plan to cut NetFlix and RedBox short and realizing their own rental/streaming services (even partnering with other Studios) that WILL have these movies available for rental as soon as they release them.

This could be viewed as unfair competition by the FCC but worth the try for the Studios.

As a sample HBO just Launched their own streaming service trying to compete with NetFlix.

Daemon_ZOGG (profile) says:

"....Will Delay New Movie Releases From Kiosks"

Hmmmm… Bad for WarnerBros. Here’s the obvious reason why:
(1.) Bit-Torrent traffic will increase by leaps & bounds. And so will the ad revenue on those tracking websites. Which will help to make them stronger and more robust.
(2.) Application developers that sell DVD conversion & duplication software will see increased revenue.
(3.) Consumers will turn to friends, family and associates to obtain early copies of these releases.
Conclusion: The consumers will find another way. And win. Again. ;-))
So, the only real losers here are Warner, Netflix, and now RedBox. ;P Screw’em

Troy Dyer says:


Being able to rent a movie the day it releases on DVD isn’t a God given right folks. I am surprised(but I shouldn’t be) at the lack of informed responses on this matter. The future will be via streaming. This deal, and ones like it, are a step towards boosting streaming libraries at the cost of a few new releases. Granted this is also a short term, band-aid, fix to get people to buy DVDs but it is also SHORT. How long did you wait last time you wanted a new release on Netflix or Redbox? Do you really want to drive to your local Walgreen’s everyday to check for that new release? I’ve had Hurt Locker on my Netflix queue for over a month and I just got it today. Do some reading and take a minute to think before you respond. This isn’t a perfect model but I’m pretty sure Hollywood is one of the few remaining industries in this country that produces a surplus. Give them some credit for moving things along even if they take a step back to take two forward down the road.

Overcast (profile) says:

Being able to rent a movie the day it releases on DVD isn’t a God given right folks.

Nor is the entertainment industry getting cash from me on *their terms* a god given right either.

Actually the last 4 movies I bought were all made prior to 1995 anyway. Most of this ‘junk’ out now, I just can’t stand.

I’m just glad they made SO MUCH stuff even prior to the mid-90’s, there’s so much to buy still..

markryder (profile) says:

when are you stupid people ever going to learn NO NOT WARNER ..YOU CUSTOMERS

You really think as customers you’re all that?
You really think you have the power to control rights owners like you are so needed.
When are you people (customers) going to learn you’re just a minority of complainers and you think you run things?
Why do you think companies protect and control their copyrights?
Your comments are ignorant when you say things like ‘how stupid warners are’ like the little customer you are, doing your 9-5 or signing on the dole, but you know best?

You call them stupid and you act like you: the customer” is in control.

Wake up people your nothing but 1 customer and you are either going to play the game the company wants or your going to go else where and the ‘company’ is not crying about your 1 little payment
You are far smaller than your internet replies make you feel because there are millions of people who do follow what ever rules the owners of the products want to set so thinking your all that is for your own ego, because your not!

if you take that final choice of stealing others protected products than you’re not only a small insignificant, you’re also a thief.

Complain like you have power but you have nothing but $9.00 for the film and the big companies won’t miss your tiny contribution or take your small minded advice on how your will just steal it from a torrent or go somewhere else. I can almost see them reading your stupid comments and laughing and telling jokes about how they need to get your personal sale

Oh dear did I burst your tiny bubble and now you realise all your stupid advice about how you know best is actually laughable. Look at yourself what do you really know and how do you have the inside track on the rights holders and they don’t know what they are doing..please you make yourselves sound so stupid!
There problem is not little people like you who talk like you know something but actually don’t.
The only problem to rights holders is the thieving community which is and always has been the traits of the lowest of low life and that’s a totally different thing to deal with than some over self important customers

Mark Ryder

therese (profile) says:

new release at store before rentals

who do I contact to complain when a store puts out a movie before it’s release date? Someone needs to come down on the store in oregon that is selling the explendables movie today on 11/19/10 the release date is 11/23/10. They are not supposed to have it on sale yet. nobody else has it no sale yet and the store that is selling it today should be fined big time!!!

Brenda Trenton says:


Hell, I have no problem waiting years to watch movies I know are only going to be mildly tolerable, let alone 28 days. If there’s a movie I want, I’ll buy it. If not, I have no problem waiting. Still, it seems like a pretty dumb move on Warner’s part. I guess I’ll just keep watching only the good movies – like the ones at

Anonymous Coward says:

Warner 28 day release

I started my video specialty business in Jan. 1979. This was significantly prior to the pre-recorded movie business. It evolved into the movie rental business when the big box corporate entities decimated the hardware business and the so called war between vhs and beta was settled in the USA.

Over the years I watched the industry raise the price of VHS movies from $59.95 to $104.95 retail. I also (via trade mag info) found the outlandish attempts at high speed VHS replication that were tried. The real time replication was considered a major barrier to the industry. High speed replication, it seems, generated more problems than it solved.

The situation the studios are in is a direct side effect of digitization, something which was previewed by the audio industry. (DA) In order to get the DVD format established literally overnight, the studios had to work with the mass marketers, (WalMart, KMart,Target,etc) and they sold movies for $15 or less. These retail giants knew they were in the catbird seat and demanded that new releases be included before they would stock this new format. Overnight $104.95 VHS new releases were available as $19.95 DVD new releases.
What was accomplished by this DVD deal was to devalue new movie releases to 1/5. The side effect of this was the motivation to over saturate the market to make up the difference. This caused another problem addressed by ebay and amazon, cheap used movie dumps via used media brokers, which further stressed the value of a movie.

Another side effect of digitization high speed replication was it also allowed high speed/cheap piracy via recordable DVD and internet distribution. The logistics of DVD allowed for mail order sales and rental as well as viable vending machine operations. All these approaches involve the removal of the human labor factor as the premise for their marketing advantage. The result of thousand of jobs being lost in the video rental realm.

When all these new access came into play, the big box corporation found that it was beneficial for them to shrink their movie operations to the extent that alarmed the studios about the seriouly eroding physical presence and sales of new DVD releases. History of home video demonstrates that package entertainment(VHS,DVD) sales were noticeably more profitable than a electronic mediums. The current actions by MGM are not attempts (in my opinion) to prevent people from viewing movies, but rather to provide a release schedule to bolster their dangerously sagging DVD sales market.
In the early days of home video there was an orderly release schedule and equally orderly access to home entertainment which facilitated the market very well. Home entertainment had much more value. The digital age has injected mass confusion in this process, much of this confusion is illegal distribution.

I hope this confusion will be settled for the benefit of all, however I will admit to having no better answers than MGM.

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