Redbox $1 vs iTunes & Amazon $2.99, why?

nanotlj

macrumors regular
Original poster
Jan 15, 2008
154
0
I am always wondering: If Redbox can manage to rent for $1, why iTunes, Amazon charge $2.99? It is because Apple & Amazon can not negotiate a better deal, or because of difference of catalog selection?
I certainly can understand the convenience of rent through online streaming, but I do not think that justifies the 3x fee. What is your experience?
 

mic j

macrumors 68030
Mar 15, 2012
2,656
150
I am always wondering: If Redbox can manage to rent for $1, why iTunes, Amazon charge $2.99? It is because Apple & Amazon can not negotiate a better deal, or because of difference of catalog selection?
I certainly can understand the convenience of rent through online streaming, but I do not think that justifies the 3x fee. What is your experience?
Could it be that Apple and Amazon have to maintain huge server networks while Redbox just needs a warehouse with bins of dvd's and someone to restock the kiosks? Just thinking...
 
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DaveGee

macrumors 6502a
Jul 25, 2001
677
2
Could it be that Apple and Amazon have to maintain huge server networks while Redbox just needs a warehouse with bins of dvd's and someone to restock the kiosks? Just thinking...
Nope.. It has more to do with the fact that redbox is very similar to ye ole time video store .... A place that was always aloud to rent media for whatever the market would bear... Online video rental s a whole different animal one where the content owners can keep a tight fist on the price.

Oh and the reason Netflix caved into limiting their disc media rentals even to the point where they would wait a month or more before offering a title in disc form that redbox could start renting from day one is due to the fact that Netflix wanted disc rentals AND online streaming access and was willing to knife the disc side of the business for the betterment of the streaming.
 
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warvanov

macrumors 6502a
Oct 13, 2011
504
7
Also because Redbox makes money when you forget to return DVDs the next day and hold on to them for a week at a time.
 
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utazdevl

macrumors regular
Jul 18, 2008
107
26
I am always wondering: If Redbox can manage to rent for $1, why iTunes, Amazon charge $2.99? It is because Apple & Amazon can not negotiate a better deal, or because of difference of catalog selection?
I certainly can understand the convenience of rent through online streaming, but I do not think that justifies the 3x fee. What is your experience?
No, it is because Redbox operates (fairly) independently of the studio system, renting out product that it buys from studios. When Redbox started up, they had no deals with the various studios, and operated within the "fair use" laws, allowing one person to rent out a physical object it rightfully purchased to a 3rd party without paying the originator any fees. ITunes and Amazon don't rent physical product, and basically license encodes, which require originator input and hence a greater fee, as the studios HATE that Redbox sets the value of their product at $1 per 24 hours.
 
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jlc1978

macrumors 68030
Aug 14, 2009
2,598
985
I am always wondering: If Redbox can manage to rent for $1, why iTunes, Amazon charge $2.99? It is because Apple & Amazon can not negotiate a better deal, or because of difference of catalog selection?
I certainly can understand the convenience of rent through online streaming, but I do not think that justifies the 3x fee. What is your experience?
A few thoughts:

1. Studios make boatloads of money on DVD / BD sales and do not want streaming to jeopardize that. As a result, the deals they negotiate reflect a desire to protect that revenue stream. Since streaming, as was pointed out above, does not enjoy doctrine of first sale (which is a bit more murky than it sounds) rights studios have more leverage on those deals than on sales.

2. Redbox relies a lot on impulse buys and so needs to price low enough to get people to buy when they go into a store. Since they can buy DVD/BD cheaply in bulk and have no ongoing license fees they can price lower to generate traffic. Volume is why Redbox is expanding its footprint - they cover something like 70% of the US population right now - so they are a pretty good option for people wanting to see the latest releases.

3. The studios don't really hate them since they don't seem to have much of an impact on sales overall so they don't threaten their model. An interesting analysis would be how many people buy a movie after watching it on Redbox. Unlike Blockbuster, which also bought a lot of disks, Redbox doesn't dump huge quantities on the used market not long after the initial release; which is why they are not really a threat to the business model.

4. Finally, RB offers a higher quality video that is easy to play - everyone is familiar with dropping a video into a player and watching it. They don't have to mess with settings, logging on, etc., nor does the video pause or lose quality if their is a network issue. Despite what many on here may think, most people are not as knowledgeable or interested in making the technology work. they just want to watch teh movie, and a $1 a pop Redbox is a great choice for them. Streaming has been around for a long time but is still slow to catch on; and IMHO until someone really "cracks the code" on ease of use and quality it will remain a technology with a lot o potential but slower than desired uptake.
 
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thatoneguy82

macrumors 68000
Jul 23, 2008
1,895
2
Beach Cities, CA
I am always wondering: If Redbox can manage to rent for $1, why iTunes, Amazon charge $2.99? It is because Apple & Amazon can not negotiate a better deal, or because of difference of catalog selection?
I certainly can understand the convenience of rent through online streaming, but I do not think that justifies the 3x fee. What is your experience?
Don't you mean $4.99? I'm assuming you're comparing movie rentals. iTunes movie rentals are $4.99 for 30 days or 48hours. TV shows are $2.99/episode.

It's a lot, but you can't put a price on convenience and the "gotta-have-it-now" feeling. I can't even imagine how much I've spent on TV seasons alone already.:eek:
 
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brentsg

macrumors 68040
Oct 15, 2008
3,484
852
Redbox movies were scratched to hell when I tried the service. My family watched a partial movie far too often.
 
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GoCubsGo

macrumors Nehalem
Feb 19, 2005
35,741
146
Redbox is $1.00 but how much do you spend in gas and time to get to said box? I think $4.99 is worth not having to go out in the rain if I must watch something I don't own.
 
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Doc750

macrumors 6502a
Aug 11, 2010
803
4
Don't you mean $4.99? I'm assuming you're comparing movie rentals. iTunes movie rentals are $4.99 for 30 days or 48hours. TV shows are $2.99/episode.

It's a lot, but you can't put a price on convenience and the "gotta-have-it-now" feeling. I can't even imagine how much I've spent on TV seasons alone already.:eek:
I have spent zero. Between Netflix/Hulu/xfinity app/network apps there is no reason for me to give them a dime.
 
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jlasoon

macrumors 6502a
Jun 1, 2006
505
627
Orlando, FL
Redbox is $1.00 but how much do you spend in gas and time to get to said box? I think $4.99 is worth not having to go out in the rain if I must watch something I don't own.
A little over dramatic :rolleyes: The rain? The gas?

I have a RedBox within walking distance. Heck most RedBox kiosk are situated at gas stations or WalMarts, places people frequent multiple times a week for things other than a movie.

$4.99 is asinine no matter how you spin it.
 
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GoCubsGo

macrumors Nehalem
Feb 19, 2005
35,741
146
A little over dramatic :rolleyes: The rain? The gas?

I have a RedBox within walking distance. Heck most RedBox kiosk are situated at gas stations or WalMarts, places people frequent multiple times a week for things other than a movie.

$4.99 is asinine no matter how you spin it.
That is hardly dramatic. If I don't want to go out in the rain then $4.99 is worth my convenience. Dramatic? No. Lazy, perhaps. My money, yes. Thanks champ. ;)
 
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designs216

macrumors 65816
Oct 26, 2009
1,044
14
Down the rabbit hole
Redbox gets my business 90% of the time since I watch mostly new releases and it's on the way to the places I'm going anyway. You just can't beat that price. Redbox is not without flaws but it works as promised most of the time.

For titles I can't find in Redbox, I usually use Vudu.com since I don't have ATV. Here's a good comparison of iTunes vs. Vudu.com.
 
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thatoneguy82

macrumors 68000
Jul 23, 2008
1,895
2
Beach Cities, CA
I have spent zero. Between Netflix/Hulu/xfinity app/network apps there is no reason for me to give them a dime.
Yes, but I hate commercials, they disrupt me from my viewing experience. Call me superficial, but I prefer to watch in a "prettier" and higher quality format on my TV all the time and on one device.
 
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mmomega

macrumors 68040
Dec 30, 2009
3,468
1,661
DFW, TX
I only pass by a RedBox kiosk maybe once a week if that without going out of my way and I never know when my wife and I will be in the mood + have time to sit and watch a movie together.

At least for us aTV/ iTunes makes more sense. There have been many times when it was either just us sitting around or when we have company over and during conversation someone says "Hey have you seen that new movie" and noone wants to get in the car and find a RedBox location (like we used to when we were smaller going to Blockbuster when it was a big deal) much easier to pick up the remote and start the movie right then and there.
 
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cdavis11

macrumors 6502
Aug 31, 2009
289
64
Because to rent from RedBox in my town I have to haul myself down to the kiosk that is often out in the cold or snow (in my neck of the woods).

I'll pay a one or two dollar premium to stream and browse my choices online.
 
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jaysen

macrumors 6502
Sep 16, 2009
272
2
A little over dramatic :rolleyes: The rain? The gas?

I have a RedBox within walking distance. Heck most RedBox kiosk are situated at gas stations or WalMarts, places people frequent multiple times a week for things other than a movie.

$4.99 is asinine no matter how you spin it.
agreed.
 
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peeaanuut

macrumors 65816
Sep 10, 2007
1,048
0
Southern California
you are assuming that most people have that option. the closest anything to my sister in Vermont is over 20 miles away. So a 40 mile round trip that usually would involve snow or bad weather. $4.99 makes more sense.

As far as me, the selection at both of the Red Box kiosks near me is horrible at best. Its rare that I rent, but if I do, i want to be able to actually rent the exact thing I want.
 
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Primejimbo

macrumors 68040
Aug 10, 2008
3,295
131
Around
Redbox is $1.00 but how much do you spend in gas and time to get to said box? I think $4.99 is worth not having to go out in the rain if I must watch something I don't own.
A little over dramatic :rolleyes: The rain? The gas?

I have a RedBox within walking distance. Heck most RedBox kiosk are situated at gas stations or WalMarts, places people frequent multiple times a week for things other than a movie.

$4.99 is asinine no matter how you spin it.
Redbox is $1.20 now, but since they raised the price from $1 to $1.20, I have yet to pay that. I get so many offer codes for free and $.50 off rentals, quite nice. I pass a Redbox to and from work so I'm not wasting anymore gas at all.
 
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OptyCT

macrumors 6502
Nov 9, 2008
360
4
Also, Redbox offers a limited number of movies at a time (typically newer releases), whereas iTunes & Amazon have a lot more options.
 
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