DVD and Movies take money away from Blockbuster Video and Others

Discussion in 'DVD' started by Erwin, Jan 29, 2003.

  1. Erwin

    Erwin Stunt Coordinator

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    I read a very interesting article about how DVD and the movies effected Blockbuster Video in 2002. They claimed that Blockbuster lost millions last year while DVD and the Box Office Movies saw a major jump from last year's sales. The video rentals were making excuses for their decrease in sales such as "it didn't snow as much or rain as much last year and this brings people to our stores (OK??)" or "DVDs were too cheap last year". DVD were too cheap? C'mon, when REEL.COM existed and everyone could get a DVD on average for $9.99 (shipping included)---that was cheap! Yeah, there were some good deals, but you really had to hunt for them and price match with flyers in your hand. Sooner or later, DVD will get an average price similiar to VHS (it already has in some cases- ex. Bargain titles). I, personally, think it's funny to see the rental market have to face some from DVD sales (I mean, most of us thought it would never happen when back in 1998, Blockbuster would not even touch DVD until they were literally forced to). It's also funny that someone stated this in an article, "Well, DVD may have won against VHS in the movie market, but hey, we still have to record and watch our videos. So, VCRs are here to stay". Obviously, this guy is unaware of a device that will soon permanently crush VHS forever....DVD-R . Pansonic has a new model they are going to release in March for a retail under $600. As soon as DVD Recorders go as low as $199 and DVD-Rs reach a price point of about 70-80 cents each, it's bye-bye VHS.
     
  2. Shawn RM

    Shawn RM Auditioning

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    Why do you need a VHS player right now anyway (except to play back all those VHS tapes you bought your 3yo daughter [​IMG])? While DVD-R is still in it's infancy there is TiVo as well as home computer systems with All-In-Wonder cards etc.. that do fantastic jobs.
     
  3. Joe Szott

    Joe Szott Screenwriter

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    Erwin,

    It's simple: DVDs cost $10-15 to buy, BB rents them for $4 for just a couple of days. Plus, they are real jerks about late fees so it can easily be $8 a rental. If they dropped fees to $1 for one/two nights, I would be back in their stores...
     
  4. Eugene Esterly

    Eugene Esterly Supporting Actor

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    Also, don't forget that Blockbuster is losing money because they won't stock Widescreen movies for rental.
     
  5. Lew Crippen

    Lew Crippen Executive Producer

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    Since I’ve not read the article, I can only speculate as to its intent, but the 2002 year-end financials for Blockbuster were indeed poor. So much so, that Blockbuster stock took a significant hit.

    The Dallas Morning News reported in their financial section a few weeks ago (IIRC) that there were two reasons for the downturn: DVD sales cutting into rentals and Blockbuster themselves having little success in DVD sales.

    As Joe has already pointed out, the price differential is often not enough to dissuade people from a purchase.

    Blockbuster (and the mass market rental companies in general) have attempted to sell (both DVDs and videos) in order to pick up some of the profits in this area. However they are unable to compete with retailers such as Target, Best Buy, Fry and even the local supermarket, as all of these retailers discount heavily as a matter of routine.

    The rental chains’ business model is not set up to compete with the low-margin, high sales approach used by a Target, for example.

    In the past Blockbuster in specific has had no interest in competing in the ‘specialty’ movie market. And it is probably too late to correct that now, even if a change were economically viable.

    It may well be a very hard year for the mass market, rental chains.
     
  6. Erwin

    Erwin Stunt Coordinator

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    "It's simple: DVDs cost $10-15 to buy, BB rents them for $4 for just a couple of days. Plus, they are real jerks about late fees so it can easily be $8 a rental. If they dropped fees to $1 for one/two nights, I would be back in their stores..."

    Yes, the way I see it, you can buy the movie and if you don't like it....tah dah...you can sell it for more or the atleast the same price you paid on Ebay (no loss). Even if you get less than what you paid....it's very doubtful that you will get $4 less (the price of a rental at BB). I do have one friend who works at a Movie Gallery Rental Store and he is very pro-Widescreen. He pretty much told this lady that was complaining about it...."get used to it, it will become the only format available soon". She actually complied with his statement. I remember when I first got into DVD in 1998 (I didn't know a thing about WS, I had no clue about which studio had which movie, or what DD and dts was at the time). I was buying DVDs like people stock up on batteries for a hurricane in 1998. Some things seem to never change [​IMG]
     
  7. Erwin

    Erwin Stunt Coordinator

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    To update this, I just purchased a Panasonic DVD Recorder for $349 at Circuit City and DVD-R Media can be had for as low as 90 cents. Apex is going to release a DVD Recorder this fall for only $199 and Sony is releasing a dual DVD-R/+R Recorder this summer or fall. Wow, all this happened within 3 month after this post was made. DVD is moving faster than any format ever did. It took CD over a decade to dominate tape. DVD dominated VHS sales in less than 5 years.
     
  8. Mike Heenan

    Mike Heenan Second Unit

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    A friend of my brother's bought one of those stand alone dvd recorders (not for the computer) and he ended up taking it back because the discs only worked on that deck. I forget the model or manufacturer though. Do any of the forthcoming ones have this problem?
     
  9. Malcolm R

    Malcolm R Executive Producer

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    Yep, that's why I do little business with Blockbuster. There's a Movie Gallery just down the road that gives 5-night rentals on everything for only $1.99. And they're available in Widescreen. [​IMG]

    At Blockbuster, everything is $3.99 and some are only 2-day rentals. Plus you never know if they'll have the WS version or pan-and-scan. [​IMG]

    OAR and lower prices would get me into Blockbuster on a more regular basis.

    I thought I just heard that video rentals set a new record in the past quarter? If Blockbuster is missing out on this rental boom, it's their own fault.
     
  10. Erwin

    Erwin Stunt Coordinator

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    "A friend of my brother's bought one of those stand alone dvd recorders (not for the computer) and he ended up taking it back because the discs only worked on that deck. I forget the model or manufacturer though. Do any of the forthcoming ones have this problem?'

    It may be b/c the dvd-r discs were not finalized. It's a common problem among new users. The disc will play in the DVD Recorder only until the disc is finalized. Now, if someone wants to record and play without finalizing, than they use DVD-RAM. Of course, he or she will need a player capable of reading DVD-RAM (I got a $96 Panasonic DVD player that will at Wal-Mart). Once the DVD-R disc is finalized, it will play on most DVD players.
     
  11. Mike Heenan

    Mike Heenan Second Unit

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    Oh I see, that's probably why it didn't work for him.
     
  12. Jeff Kleist

    Jeff Kleist Executive Producer

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    The Apex DVD-R recorder will probably be awful, but I am intrigues at the good brands in the $2-300 range.
     

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