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Red Box, Netflix Fight Disney Over New Release Delay
Because Stupid Rules Will Keep the DVD From Dying, Right?

Last February Warner Brothers convinced Netflix to delay new release DVDs by 56 days -- and got Netflix to prohibit users from even adding upcoming releases to their queue until 26 days after release. Studio executives believe this will drive users to buy more DVDs, but as everybody except for the entertainment industry has figured out, simply acts to annoy users and drive them to explore piracy.

Earlier this year Red Box refused the 56 day new release delay, and decided to renew their contract with Warner Brothers, instead getting movies from retail as they go on sale. Disney recently joined the fun, trying to prohibit Netflix and Red Box from offering DVDs for a month after release. However, both Netflix and Red Box appear to both finally be getting bored of this game, and are fighting Disney:

quote:
Disney is the only studio at loggerheads with Netflix over the window issue, but it's not the only one fighting with Redbox. The kiosk rental company refused to accept Warner's demand that it wait 56 days to rent new releases, as its business is heavily dependent on having fresh movies. It is now stocking its machines with Disney and Warner discs that it purchases from retail stores. Such negotiations ultimately amount to a high-stakes game of chicken. Under the "first sale" legal doctrine, studios can't forbid companies from renting DVDs that they legally purchase.
By not selling them bulk discs unless they sign annoying agreements, it's another way for studios to ramp up costs for innovative new content companies (alongside licensing). The problem is that studios have in turn been going to retailers and forcing them to limit the number of discs that companies like Netflix and RedBox can purchase. It's yet another example of an industry refusing to innovate in the face of evolution (in this case, broadband video and the death of physical media), instead resorting to anti-competitive and often self-destructive tactics in the hopes they can keep things as they are.

It will be interesting to see if RedBox remains tenacious on this front later this year as they push harder into the streaming business in their joint venture with Verizon.
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Oh_No
Trogglus normalus
join:2011-05-21
Chicago, IL

Oh_No

Member

They cant stop them.

All they have to do is go to Best Buy.
Even if BB corporate puts a limit on DVD sales, if someone comes in any manager will gladly sell their entire stock of any DVD at full price. Best Buy managers have no encentive to follow any corp rules. They will do anything that makes their store numbers look better.

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: They cant stop them.

said by Oh_No:

All they have to do is go to Best Buy.

But in this case Disney won't even give them to Best Buy or any other retailer until 28 days are past.
»www.homemediamagazine.co ··· ls-27470

GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

GlennLouEarl

Premium Member

Re: They cant stop them.

Huh? (Best Buy -> retail, not rental)

Not sure what you're tryin' to say here.

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: They cant stop them.

said by GlennLouEarl:

Huh? (Best Buy -> retail, not rental)

Not sure what you're tryin' to say here.

Netflix and RedBox buy from retailers to get their cache of rental DVD's. But Disney won't sell anything to any retailers until 28 days are past. Meaning, no matter what RedBox does, they have to wait at least 28 days. That is better than what Disney wants to make them wait in order to get a discount, but they stiil have to wait at least 28 days.

GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

GlennLouEarl

Premium Member

Re: They cant stop them.

Well, I'm not saying that isn't what Disney might want, but that's not what's happening now/yet. Retailers have it in stock. They'll continue to have it in stock till they sell out. Presently, there's no such waiting period for purchasing discs from retailers. Yes, you have to pay whatever price the retailer is charging, which might be more than the bulk price offered by the studio.

vpoko
Premium Member
join:2003-07-03
Boston, MA

vpoko to FFH5

Premium Member

to FFH5
Say what? 28 days past when? If a movie isn't sold to the public, then it hasn't been released for sale. A movie is released (to DVD) when it goes on sale, once it does the rental companies can buy it like anyone else.

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: They cant stop them.

said by vpoko:

Say what? 28 days past when?

When it debuts in theaters.
Expand your moderator at work

vpoko
Premium Member
join:2003-07-03
Boston, MA

vpoko to FFH5

Premium Member

to FFH5

Re: They cant stop them.

This has nothing to do with the theater release at all. Warner and Disney want a buffer between the time a movie is released for sale on DVD and the time that movie is available for rental on DVD. Incidentally, that's also exactly what the article you linked to is about.
Expand your moderator at work
Skippy25
join:2000-09-13
Hazelwood, MO

Skippy25 to FFH5

Member

to FFH5
LOL, movies dont come out on DVD for 3-6 months after the theater.

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: They cant stop them.

said by Skippy25:

LOL, movies dont come out on DVD for 3-6 months after the theater.

All depends on the movie. Some are dogs and their run in theaters is very short. Those movies come out in DVD real quick.

Thaler
Premium Member
join:2004-02-02
Los Angeles, CA

Thaler

Premium Member

Re: They cant stop them.

If I ever saw a movie turn up for purchase only 28 days after theatrical release, I'd run far, far away.

elwoodblues
Elwood Blues
Premium Member
join:2006-08-30
Somewhere in

elwoodblues to FFH5

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to FFH5
said by FFH5:

said by vpoko:

Say what? 28 days past when?

When it debuts in theaters.

That's an entire different and even more contentious issue, the Theatre chains can't possibly make dollar 1 on even the most B of B movies in 28 days.

This logic makes no sense, since movies in theaters drive media sales, so why would want to push out media less then a month after the movie has been released?
Skippy25
join:2000-09-13
Hazelwood, MO

Skippy25 to FFH5

Member

to FFH5
That makes absolutely no sense at all.

The entire purpose of this is that they want them to wait 28 days after the DVD's are on the shelves of places like BestBuy to prop up DVD sales. So the 28 day wait is for after they go retail. If Disney doesnt sell them to the retail outlets, then they arent retail yet are they?

Oh_No
Trogglus normalus
join:2011-05-21
Chicago, IL

1 edit

Oh_No to GlennLouEarl

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to GlennLouEarl
.

GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

GlennLouEarl

Premium Member

Re: They cant stop them.

Sorry, but were you not paying attention to who posted what?

Oh_No
Trogglus normalus
join:2011-05-21
Chicago, IL

Oh_No

Member

Re: They cant stop them.

said by GlennLouEarl:

Sorry, but were you not paying attention to who posted what?

It did not say you were replying to anyone else. I retract my previous comment since you are now saying you posted in reply to that other poster.

GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

GlennLouEarl

Premium Member

Re: They cant stop them.

No worries... you wouldn't be the first person here to post a reply to another post that wasn't a reply to something he had posted. (In any event, yes, I was agreeing with you.)

Oh_No
Trogglus normalus
join:2011-05-21
Chicago, IL

Oh_No to FFH5

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to FFH5
said by FFH5:

said by Oh_No:

All they have to do is go to Best Buy.

But in this case Disney won't even give them to Best Buy or any other retailer until 28 days are past.
»www.homemediamagazine.co ··· ls-27470

Your article says nothing about limiting DVD sales at Best Buy?
said by rtfa :
The problem is that studios have in turn been going to retailers and forcing them to limit the number of discs that companies like Netflix and RedBox can purchase.
Does anyone read the articles anymore??? They are not going to delay DVD releases at retailers.

Redbox will be blocked by Disney from buying DVDs to rent.
Redbox instead can go to Best Buy or other retailers and buy the DVDs there at launch with no wait.
Disney is trying to get retailers like Best Buy, Walmart, Target, etc. to limit how many DVDs they sell to a person to prevent Redbox from sending over an employee to buy their entire stock of a DVD.

As I said this will not work as any Best Buy manager will gladly sell their entire stock of a DVD to a Redbox employee to get their store numbers up. No matter what policy corporate BB sets, their managers will ignore it to get their numbers up.

elwoodblues
Elwood Blues
Premium Member
join:2006-08-30
Somewhere in

elwoodblues

Premium Member

Re: They cant stop them.

said by Oh_No See Profile
Your article says nothing about limiting DVD sales at Best Buy?
said by rtfa :
The problem is that studios have in turn been going to retailers and forcing them to limit the number of discs that companies like Netflix and RedBox can purchase.
[/bquote :

PFFT, do you really think that a Warner Bros is going to tell the Walmart's and BB's of the world who and where they can sell their product? I don;t think so. If I walked into my local Walmart and wanted to buy the entire stock of John Carter (they'd probably give me a hefty discount just to get rid of that turd), do you think they are going to stop me?

Store managers have sales quotas to make, if I'm going to give them a big boost buying purchasing their DVD/BR stock, that's a bonus.


GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

1 edit

GlennLouEarl

Premium Member

Re: They cant stop them.

Maybe it's just your broken blockquoting, but you seem to be agreeing with what the poster you're replying to actually said, versus what he was replying to.

(Pssst, the only "turds" associated with the movie in question are the critics who panned it. Average review from customers on Amazon, Best Buy, etc. is 4.5 out of 5 stars; it's also at the top of Amazon's sales chart.)

Thaler
Premium Member
join:2004-02-02
Los Angeles, CA

Thaler to FFH5

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to FFH5
said by FFH5:

said by Oh_No:

All they have to do is go to Best Buy.

But in this case Disney won't even give them to Best Buy or any other retailer until 28 days are past.
»www.homemediamagazine.co ··· ls-27470

So...Disney won't be providing retailers with their inventory until 28 days after the commercial release date? Then where exactly would Disney prefer these theoretical paying customers to pick up these copies? Disneyland?
Terabit
join:2008-12-19

1 recommendation

Terabit to FFH5

Member

to FFH5
The Feds need to sue these guys for hampering competition (antitrust). Same goes with the cable companies hindering IPTV.

On a side note, why is it that you guys (Republicans) fail to see how government could and should demand more competition here?

The EU would smack the studios and cable companies silly if they hampered competition like this. Yes, competition, as in the bedrock of a market economy.

cdru
Go Colts
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join:2003-05-14
Fort Wayne, IN

cdru to Oh_No

MVM

to Oh_No
said by Oh_No:

All they have to do is go to Best Buy.
Even if BB corporate puts a limit on DVD sales, if someone comes in any manager will gladly sell their entire stock of any DVD at full price. Best Buy managers have no encentive to follow any corp rules. They will do anything that makes their store numbers look better.

Best Buy, Walmart, Target, et al retail stores could not possibly hope to fulfill the needs of Netflix or Redbox for a major new release.

From Redbox FAQ, a major new release can have upwards of several dozen copies of a movie in a single kiosk. I live in a decent sized city of ~300k people (including suburbs and surrounding areas). There are 50 kiosks within 9.1 miles of my house, the maximum number Redbox will return with their kiosk locator. My guess is that there is ~75 within the area. 75 kiosks * a dozen copies each is 900 copies of a movie.

Only a distributor is going to have the capability to fulfill those type of numbers, and if a distributor risks pissing off THEIR supply chain if they deal with netflix or redbox directly.

torpid123
join:2000-03-09
New York, NY

torpid123

Member

Re: They cant stop them.

Not true, they could come up with any number models to satisfy intial demand...they could call the movie a new release and only have 2 available for per box for the first weeks and have a short return period, which means they would only need to have about 150 copies (much more attainable than 900). Redbox could then buy wholesale thereafter. That's doable.

cdru
Go Colts
MVM
join:2003-05-14
Fort Wayne, IN

cdru

MVM

Re: They cant stop them.

said by torpid123:

Not true, they could come up with any number models to satisfy intial demand...they could call the movie a new release and only have 2 available for per box for the first weeks and have a short return period, which means they would only need to have about 150 copies (much more attainable than 900). Redbox could then buy wholesale thereafter. That's doable.

The whole point of a new release is that it's highest in demand. You'll have extremely low customer dissatisfaction if a kiosk has only 2 copies of a hot new release.

And there's no way to control the return period. It's already single night rental. You could charge higher prices and/or higher "late fees" for rentals longer then overnight, but then you're no better then Blockbuster et al. And how's that working for Blockbuster these days?

torpid123
join:2000-03-09
New York, NY

torpid123 to cdru

Member

to cdru
Not true, they could come up with any number models to satisfy intial demand...they could call the movie a new release and only have 2 available for per box for the first weeks and have a short return period, which means they would only need to have about 150 copies (much more attainable than 900). Redbox could then buy wholesale thereafter. That's doable.

cdru
Go Colts
MVM
join:2003-05-14
Fort Wayne, IN

cdru

MVM

Re: They cant stop them.

said by torpid123:

Not true, they could come up with any number models to satisfy intial demand...they could call the movie a new release and only have 2 available for per box for the first weeks and have a short return period, which means they would only need to have about 150 copies (much more attainable than 900). Redbox could then buy wholesale thereafter. That's doable.

Go ahead and start up that business model. Let us know how that works out for you.

pnh102
Reptiles Are Cuddly And Pretty
Premium Member
join:2002-05-02
Mount Airy, MD

pnh102

Premium Member

Content Creators Win

Disney wins with this one as this rule actually will drive up DVD sales, even if Redbox is buying them.

••••••••••••••
MyDogHsFleas
Premium Member
join:2007-08-15
Austin, TX

1 recommendation

MyDogHsFleas

Premium Member

I think you meant

Earlier this year Red Box refused the 56 day new release delay, and decided NOT to renew their contract with Warner Brothers, ...

michieru
Premium Member
join:2009-07-25
Denver, CO

1 recommendation

michieru

Premium Member

!

You can delay it after 180 days or more. I still won't purchase the DVD and I will keep my Netflix subscription. Eventually your movie will fall into the 99 cents bin and I will still not buy it.

What is so hard to understand? A DVD collection takes up physical space and I pay to watch not to own.

•••
nonymous (banned)
join:2003-09-08
Glendale, AZ

nonymous (banned)

Member

I will still see it even delayed

Since everything is delayed I still have things to watch I have not seen. So I am watching a few months behind I am still watching just at a price I like.
If I really care I still go see it in the theater.

dvd536
as Mr. Pink as they come
Premium Member
join:2001-04-27
Phoenix, AZ

dvd536

Premium Member

The bad part

About using redboxes in walmarts are you get "sanitized content" versions of the movies.

••••

GlennLouEarl
3 brothers, 1 gone
Premium Member
join:2002-11-17
Richmond, VA

GlennLouEarl

Premium Member

Irrelevant delay for most people

I buy what I want to buy when I want to buy it, which is usually determined by price (reduced, sale price). Everything else I wait as long as it takes to view (stream, whatever), even if I never see it--BFD. I think Disney especially thought 'John Carter' needed some "help" (but they're wrong--large numbers of people already want to buy 'John Carter', on Blu-ray especially). A delay will have little effect on how much money gets back to the studio, and only a little effect on when--sooner or later [meh].

dvd536
as Mr. Pink as they come
Premium Member
join:2001-04-27
Phoenix, AZ

dvd536

Premium Member

Redbox notify

Whether its a day or 100 days, i'll put a title on notify and they'll email me when its in their boxes.

disney has got to be the worse violator of the crap and unskippable shit.
88615298 (banned)
join:2004-07-28
West Tenness

88615298 (banned)

Member

Stupid is as stupid does.

The content creators are really fucking stupid. Everything they do is HURTING their profits not savings them. It's stupid they even wait 18-23 weeks to put a movie out on DVD/PPV. Fact is that the VAST majority of movies make 95% of their total box office take in the first 6 weeks. So keep a movie in the theater for 12 more weeks for another 5%? Most of which the studio doesn't even get anyways?

anon13123
@verizon.net

anon13123

Anon

Wait till all the used DVs show up on the market

I thought Redbox went to buying from the studios a few years ago becaus the studios were upset at all the used DVD sales. This will let anyone who wants a physical disc to get on at a discount.

pog4
Premium Member
join:2004-06-03
Kihei, HI

pog4

Premium Member

the part about the neflix queue is ridiculous

I don't really care about the launch delay. If I have to watch later, so be it. There will still be a steady stream of things to watch, no matter what. If it was a really good movie, chances are pretty fair that I saw it at a theater.

However, interfering with my queue is messed up. I used to enjoy going to boxofficemojo and rightclick-netflix-search titles to add to my queue. These would show up as "saved" and, upon release, would go into my regular queue.

Snakeoil
Ignore Button. The coward's feature.
Premium Member
join:2000-08-05
united state

Snakeoil

Premium Member

What of Amazon, Itunes, Vudu?

Aren't thheir chains being yanked around as much as Netflix and Red Box?
I'm sure Vudu [owned by Wal-mart] would have a lot of clout in something like this. Same with Amazon.
Kearnstd
Space Elf
Premium Member
join:2002-01-22
Mullica Hill, NJ

Kearnstd

Premium Member

Re: What of Amazon, Itunes, Vudu?

I bet that is exactly why they are not being yanked around so much. Both Amazon and Walmart are huge global merchants, If Walmart said "Its our way or the highway" Disney would have zero choice but to play ball because their stock holders would vote out the board if they lost shelf space in the largest retailers in the country and on the net.

aaronwt
Premium Member
join:2004-11-07
Woodbridge, VA

aaronwt

Premium Member

As if imposing a delay on the release is going to make me..

buy a title. That will make no difference to me. Even if it came out early to rent, the release day of the rental has no factor in whether I purchase a title or not.

buzz_4_20
join:2003-09-20
Dover, NH

buzz_4_20

Member

Funny

Tools like CouchPotato let users add DVDs that haven't even let been released in theaters.

Just another example of the legal way being more difficult and less friendly to the consumer.

astrob0I
@rr.com

astrob0I

Anon

The funny thing is.......

.....the movie studios used to be exactly the opposite. They WANTED rentals only for a few months and charged over $100 USD for the first few months for a VHS copy. A buyer had to wait quite a while for the sale price to drop. This was back in the 80's. Can you imagine what inflation would make a new movie cost using the rental-priced copies now? Disney tried several times to make their movies "rental-only". They sold cheaper copies clearly marked NOT FOR RENTAL and tried to stiff videostores for more expensive copies that came in blue shells. And of course the stores bought the cheap copies and rented them anyway. It never ends.

Octavean
MVM
join:2001-03-31
New York, NY

Octavean

MVM

Evil Empire

terrorist, attempt to make their opponents defeat themselves as they themselves often cannot do it with force.

this is what the studio's are trying to do to Netflix, Redbox and the like, get them to defeat themselves by marginalizing the service they provide. I'm a little surprised that Netflix and Redbox would ever go for this since everyone knows you don't make deals with terrorist. They will always want more going from ~30 days to ~60 then ~90 and more,.....

Mang
@comcast.net

Mang

Anon

Why don't they?

Why can't Redbox charge by the hour for new releases during the first week?

Use Case 1: customer rents new title for 1 day, charge them $1.20 for the day rate.
Use Case 2: Customer rents new title and returns movie in 3 hours, charge customer only .30 cents
Use Case 3: Customer rents new title and returns movie in 6 hours, charge customer .60 cents
Use Case 4: Customer rents new title and returns movie in 9 hours, charge customer .90 cents
Use Case 5: Customer rents new title and returns movie in 12 to 24 hours, charge customer $1.20
Use Case 6: Customer rents new title and returns movie in 24 to 48 hours, charge customer $2.40

Why can't Netflix place a kiosk in the USPS where members can return their movies in exchange for a faster turn around time OR the ability to exchange with another available movie that happens to be at the same kiosk. Then once a day in the morning, the USPS folks empty the kiosk and postal mail movies to customers without the need for a huge Netflix DVD distribution warehouse?

I honestly think both Netflix and Redbox should volunteer to negotiate even better terms with movie studios for longer delays. Meaning, I don't mind paying $1 or $2 less per month for Netflix in return for waiting 1 or 2 months longer for my DVD queue to make a newer movie available (meaning even more time above/beyond the normal 28 days or 56 days delay). For those that must have the movie ASAP, they can pay the full rate for netflix. For those that can wait 1 month, 2 month, 6 months, 1 year longer to see that same movie on DVD (allowing the people who urgently need the latest a greatest to get first dibs at a normal price).

My current netflix dvd queue has over 150+ available/ready to ship dvd movies from 2011. I could care less about the movie which available on Tuesday this week, if you give me an even greater price break. This concept would probably hurt the movie stupids so much, that they will start begging netflix to release movies sooner!