Redbox and 20th Century Fox Lawsuit

Published Thursday, August 13, 2009 12:36 PM

 



Redbox a $1 a day movie rental company that sells their movies in a vending machine like manner. Redbox is suing 20th Century Fox because of their new distribution terms. According to the new distribution terms set by 20th Century Fox Redbox will not be allowed to sell rentals of their movies until 30 days after the release of the movie to DVD.

20th Century Fox is concerned that the $1 a day rental company is cutting into their DVD sales. So they changed their distribution terms to prevent Redbox from picking up their latest releases, in hopes it will drive up DVD sales of new releases.

Fortunately for Redbox not all companies feel the same way about them as 20th Century Fox Does. Redbox has already signed multi-year contracts with Lionsgate and Sony.

Redbox has already stated that they will continue to provide the latest in DVD entertainment including that of 20th Century Fox.

I have to say I don’t know very many people who will buy a movie they have never seen before. I think that many people now a days will find a way to rent, or watch on demand, movies they have never seen. If you are the kind of person that watches a movie once and has no desire to watch it again you’re not the kind of person buying DVDs anyway.

It’s cheaper to just have a Netflix account or rent movies from the Apple itunes store, On demand cable, Xbox on demand, or Blockbuster. So I don’t think people renting a movie a movie for $1 is going to reduce DVD sales. If I person rents a movie and likes it enough they will buy it. The only sales I see companies loosing are people who rented the movie for a dollar and didn’t like it enough to buy it. These customers might have bought the movie if there’s no way of watching it for cheaper than the DVD retail price. Which is not the case in most situations. So you end up loosing DVD sales of people who are dissatisfied with their purchase.

I think 20th Century Fox should just chill and embrace rather than shun.

Update August 20, 2009

 It seems that 20 Century Fox isn't just going after Redbox but Netflix as well. They are going to attempt to make their new releases only available for purchase in the first 30 days of release. After the first 30 days of release they are going to release the movie to the other services such as netflix, and Redbox. 

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