CONSUMED BY MEDIA

Blockbuster brags about its windows. But will they help it survive?

Posted in Blu-ray, DVD, Netflix, Redbox, rentals, VOD, Warner by Diane on March 23, 2010

Armed with an updated (presumably) revenue-share agreement with Warner Bros., Blockbuster is squaring off against Netflix and Redbox.

The ailing chain is touting today’s availability of “The Blind Side” at Blockbuster stores, by mail or on demand. Netflix and Redbox, which recently agreed to a 28-day rental window in exchange for improved terms, does not yet have access to the movie, which notched an Oscar win for Sandra Bullock earlier this month.

The question: How much will this new window help the chain, and rental stores in general, compete against popular Netflix and Redbox? Blockbuster is making a big deal out of the fact that it’s the only “multi-channel provider” with access to big movies on street date. But is it really that great a selling point with consumers?

Studios would prefer consumers buy their movies on disc or via download. Barring that, they would prefer consumer rent  movies on demand or at a Blockbuster; the economics are better that way. (Netflix operates on a subscription-based model; Redbox’s bargain pricing is considered a threat to sales, VOD and revenue-sharing rental chains like Blockbuster.)

As for digital: The release carefully notes that existing deals remain in place. The updated deal only applies to DVD and Blu-ray.

So no, bloggers, the studios aren’t really giving Blockbuster scandalously preferential treatment. They’re just agreeing to continue supplying the ailing chain with discs at a time its future looks shaky.

UPDATE: LATimes reports that the new revenue-sharing arrangement improved terms for both parties.

Blockbuster release (via paidContent)

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