Louie Swisher Hearts Redbox–But Hollywood Not So Much

Comments

1. Unfortunately many of us are only concerned with how “it will affect ME today”, instead of looking at the long term consequences. Red Box’s business model is dependent on destroying the many “brick and mortar” video stores that supply the jobs for our school bound kids, that pay real estate taxes in our communities, that carry huge movie selections and offer quality customer service.

   I know this, because I have owned and operated a local video store since 1996. During that time my wife and I have paid over $150,000 in property taxes. We have given jobs to over 100 kids. Through donations, we have supported sports teams, churches, non profit organizations and many families looking to put on benefits for ailing family members.

   I say “yes” support Red Box if you think the price is worth – No customer service, No selection, No local support, No parental control.

   The video that accompanies this article is cute until you fast forward it to next year or the year after, when another child like him is renting “R” rated or “UN” rated movies with his buddies. This doesn’t happen at our store since we have human hands-on interaction with our customers. For those who are to young to remember – cigarette machines use to be on every corner too.

   Posted by Clint Herbst at August 31st, 2009 at 6:58 pm
   

2. C:

   Excellent points.

   I was using Louie to show the consumer appeal that is still hard for Hollywood to fight, but you are correct about Redbox’s negative impact on some other businesses.

   Posted by Kara Swisher at August 31st, 2009 at 7:32 pm
   

3. What is happening in the Video Industry is definatley alarming. The business model that Red Box has in place is devaluing the entire industry affecting every aspect of this industry from traditional rental locations, local economies, and eventually the quality of the films being made. Consumers can get a movie for $1 when they paid $3 to $4 five years ago. I cannot name too many products that have had their perceived value go down so fast in 5 years as has dvd rentals. $1 today would be like renting for $0.60 ten years ago. The same thing happened in the music industry and look at the trickle down effect it’s had. I believe there is a place in this industry for kiosk I just think it should be in a more rental windowed way. I believe the studios who are in Litigation over this issue are doing what they should be doing which is protecting the value of their product as well as the industry they are in. I honestly feel that a nights worth of family entertainment is worth more than a dollar and I think once redbox is done with the market share faze of the business model they are in they will be free to raise rates as they please.

   Posted by jon engen at September 1st, 2009 at 7:30 am
   

4. Dear Ms. Swisher,

   The Redbox issue is a complicated one – lawsuits, revenue sharing agreements, and new technologies are just a few of the issues. In the end, the Redbox situation boils down to one thing: jobs. Redbox is trying to jump the line in front of everyone else in the industry and if they succeed in under-pricing content, distributors ranging from large video stores to mom-and-pop rental operations (like mine) will be driven out of business. Over the last 27 years, our video store has provided jobs to hundreds of kids, we’ve paid hundreds of thousands of dollars in taxes and we’ve made numerous donations to local community groups. We are heavily invested in our community. With Redbox, local dollars will end up going out of state, bringing more economic pain to local communities during the worst recession in our nation’s history.

   Redbox doesn’t talk much about killing jobs, just like they don’t talk about the fact that kids can rent R – and even Unrated Products – from Redbox kiosks. Most parents would not think twice if they saw a charge from Redbox on their credit card statement. However that’s all they see – there is no information about the title that was rented and no way to stop a child from renting an R rated or Un-Rated movie. Any child with at Visa gift card could do it. That the same reason public cigarette machines were taken out. After receiving public pressure on this issue, Redbox said they would remove Un-rated products from their machines. However, they still have not done so. Much of the hard work video stores have done to enforce rating restrictions for parents will be washed by the wayside if Redbox is able to continue renting R and Unrated movies to children.

   Redbox does tell consumers that Redbox is “cheaper.” On the face of it $1 DVD’s sounds cheaper than $3-$5. The problem is, research shows that most consumers keep videos on average longer then 1 or 2 days. Redbox also says they have “No Late Fees,” which is merely a play on words. There are No “Late Fees” because you pay for the number of days you keep the video. At my store, if you keep a product 5 days it’s $3.99 vs. Redbox’s $5.00. Which is a better deal?

   Finally, there is nothing like the customer service of your local video store. In our store every disc is checked upon return to avoid defective products – Redbox does not. Our clerks help recommend products for customers and when it comes to movies that are not a New Release, Redbox can’t even compare to our selection! Video stores have thousand of videos to choose from including many of the movies your kids use for school reports and projects,whereas Redbox only has 100-200 movies,

   For consumers, a debate about $1 DVDs vs $4 DVD’s might sound trivial, but it is an important one that could have a devastating economic impact on communities around the country. As a video store owner, I hope that consumers will dig a little deeper into the facts so that they will see the truth about what Redbox is really all about.

   Posted by ROSS FLINT at September 1st, 2009 at 5:55 pm