The DVD / Blu-ray RentalGate Scandal

[3db]

The unethical actions of one party should not equate to justification for unethical actions by another. Both parties should be equally ridiculed and condemned.

I agree but it appears that I'm the only one mentioning "the man" . Everyone is busy picking on the small guy and has not even acknowledged the fact in how crooked the other side is.

 

[Quickley17]

I'd be interested in knowing a few things about these disks...

1. What does it cost to make a DVD/Blu-Ray?
2. What does it cost Best Buy/Amazon to buy a DVD/Blu-Ray?

That is to say, what is the expected margin on every disc for the owner of the content, and what is the expected margin for the retailer of the product?

With automobiles, especially American made automobiles, the manufacturer realizes a small, between 5-10%, profit on each vehicle it produces. The shipbuilding industry is similar. A 100 million dollar ship might sell for 105 million dollars. A dealership realizes even less. It is common for the dealer to sell the car to you for what they had to pay for it, especially recently when in order to move the cars off the lot, you are getting the same deal as employees of the manufacturer which is sometimes LESS than invoice. The only reason this works at all is because most dealers make their money on maintenance and repairs.

This obviously isn't an option in the music/movie realm, so I'm curious at what stage the mark-up really happens. A direct comparison between the price at Best Buy and the price on Amazon leads me to believe that Best Buy is collecting a huge amount off the top.

 

[skers_54]

I agree but it appears that I'm the only one mentioning "the man" . Everyone is busy picking on the small guy and has not even acknowledged the fact in how crooked the other side is.

"The man" is definitely at fault in this cycle. High prices make piracy more attractive, especially for less affluent people. Let's face it, most of the people pirating movies are relatively poor teenagers and young adults.

The studios, however, have the power to make watching movies a major PITA. It's because of them that upconverting DVD players only work via HDMI and there is an option (thankfully unexercised) in Blu-Ray to restrict analog output to 480i. We need to play their game to a certain extent to keep the studios from inwardly justifying the implementation of draconian restrictions like the aforementioned. I personally think DRM does more harm than good, especially to people with older equipment. Unfortunately, it only takes one creative statistician to convince the studio execs that further restrictions are fiscally beneficial.

 

[JerryLove]

I'd be interested in knowing a few things about these disks...

1. What does it cost to make a DVD/Blu-Ray?
2. What does it cost Best Buy/Amazon to buy a DVD/Blu-Ray?

This is unquantifiable without knowing end volume. Don't forget both what it cost to make and advertise the movie, and the need to fix ones that lost money.

With automobiles, especially American made automobiles, the manufacturer realizes a small, between 5-10%, profit on each vehicle it produces. The shipbuilding industry is similar. A 100 million dollar ship might sell for 105 million dollars. A dealership realizes even less. It is common for the dealer to sell the car to you for what they had to pay for it, especially recently when in order to move the cars off the lot, you are getting the same deal as employees of the manufacturer which is sometimes LESS than invoice.

Well. Except for the "dealer holdback" which is a fixed percentage of MSRP (varied by distributor) that is paid to the dealership for each car they sell, and of course that skips factory-to-dealer incentives, and for that matter factory-to-customer incentives that they keep for their own. In fact, it's not uncommon for a dealership to report a car as "sold" when it actually isn't because there's a good incentive related to either individual sales or meeting a quota (and those quotas get them money from the distributor that isn't on the invoice either).

Then there's the kickback they get from the finance company for over-charging you for financing (if you want the best deal on a car, don't tell them you are self-financing till *after* you've hit a price), and of course that "extend maintenance" contract, which is something like 75% profit for the dealer.

Plus "dealer fees" that can be from several hundred to a couple of thousand for "prepping the car"... only it isn't optional. It's another part of the income.

And don't get me started on used vehicles.

I suspect your numbers are similarly skewed on the manufacturing industry (ships and cars) but have less knowledge on the top of my head there.

This obviously isn't an option in the music/movie realm, so I'm curious at what stage the mark-up really happens. A direct comparison between the price at Best Buy and the price on Amazon leads me to believe that Best Buy is collecting a huge amount off the top.

Best buy has to pay a lot more to service you... and they don't charge shipping.

 

[kleinwl]

Cost savings with stripped disks

What you guys are not addressing is the cost/margin savings of offering a stripped version.

A Stripped version probably only requires a single layer blue-ray disk (25GB), verses a normal dual layer disk (50GB). Mastering a single layer disk will obviously lower the cost of providing rental disks.

A quote from a blue-ray replication outfit shows that in retail packaging, a unit cost is $2.09 (for 5,000 units) per disk (dual layer). A DVD in retail package is a mere $0.85 (for 5,000 units) per disk. So, the studios and the rental groups have a problem... the blue rays cost more. Switching to single layer disks brings the prices down to $1.40 (for 5,000) per disk.

While you may object to the studios saving $0.69 per disk, I am sure that the business case in selling 13 million units (iron man) with a savings of $0.69 each makes sense to them.

 

[Alex2507]

I think this is complete crap!

Agreed. I'm actually sorry that I bought a BR player now.

I want a BMW and I think they are over priced... hmmmm... I'll just steal one.

I had no idea you were so judgmental.

... then you have no moral footing on which to stand.

LOL! ... you talking to me?

 

[Downtowner]

Hold on a minute

"... the movie industry wants to discourage renting to instead purchase overpriced Blu-ray and DVD’s you will probably at best watch once or twice and then shelf in your immense unwatched collection of discs."

Isn't this the exact opposite of the logic we used ten years ago to fight Circuit City's DIVX proprietary DVD rental scheme? Back then, we all said that the greedy studios wanted to eliminate movie "ownership" on VHS and DVD and move everyone to a pay-per-view model like CC's DIVX, ultimately killing off regular DVD.

Now we're saying that no, the studios want to force us into the total ripoff of a movie "ownership" model because they can't make any money through rentals?

We can't have it both ways.

I think everyone needs to take a deep breath and realize that the studios will offer movies to the market in whatever format and medium that people are willing to pay for. In this case, if the public doesn't like the stripped-down rental discs, low consumer acceptance will cause disk rental revenue to fall even further, forcing a change in marketing strategy.

I'm not worried about this tempest in a teapot one little bit. Like DIVX, it's just another pothole along the technological road leading to the inevitable future world of on-demand entertainment without any physical media.

 

[Audioholics]

Good observations.

 

[j_garcia]

They aren't trying to "force" anyone into ownership since you don't have to buy their products (duh), which is not the same as what we would have had with DIVX - you would have had no choice but to pay the fee. They are trying to tip a small segment of the market into buying rather than waiting or renting and I find it kind of a foolish strategy unless all rental markets do the same. If I *really* want to see it and I can rent it at a local Hollywood or Blockbuster, why would I wait for a month on Netflix? If they can't get those two to do the same, it will end up being one of those deals that never really went anywhere, aka:fail.

 

[itschris]

... nevermind.

 

[chris357]

This is unquantifiable without knowing end volume. Don't forget both what it cost to make and advertise the movie, and the need to fix ones that lost money.

Well. Except for the "dealer holdback" which is a fixed percentage of MSRP (varied by distributor) that is paid to the dealership for each car they sell, and of course that skips factory-to-dealer incentives, and for that matter factory-to-customer incentives that they keep for their own. In fact, it's not uncommon for a dealership to report a car as "sold" when it actually isn't because there's a good incentive related to either individual sales or meeting a quota (and those quotas get them money from the distributor that isn't on the invoice either).

Then there's the kickback they get from the finance company for over-charging you for financing (if you want the best deal on a car, don't tell them you are self-financing till *after* you've hit a price), and of course that "extend maintenance" contract, which is something like 75% profit for the dealer.

Plus "dealer fees" that can be from several hundred to a couple of thousand for "prepping the car"... only it isn't optional. It's another part of the income.

And don't get me started on used vehicles.

I suspect your numbers are similarly skewed on the manufacturing industry (ships and cars) but have less knowledge on the top of my head there.

Best buy has to pay a lot more to service you... and they don't charge shipping.

I'm a car salesman so I can say BULL ****!!!!

try selling cars not just for a month but for 6 months. try making a living at it. Its a hard job.

Do you work for free? does your company make a profit? why is it only unfair when a car dealer makes a profit?

why is PROFIT a bad word?

?????????????????

ok so how hard is it to get a fair price when everything we have is published.. dealer cash is published, customer cash is published (and within hours of us getting it)

Cost is published , hold back is published and ok hold back at 1.5% of 50k car is $750... wow thats alot of money

so how much do you think we make? and where do you get your information? is this just what you feel because you think you got screwed on a car deal?

in my experience the super mooches like you who get the best deals never believe it.. you always think we have all this money to play with.. well I will show you my sad little W2


this is whats wrong with this country no body wants to let anyone make a living.

if you want to help the economy let the place you are buying from make a profit.. dont ask how much do I get off.. dont ask can you give me something for free.. just buy it.. shut the hell up and buy it.if you cant afford it go home..

 

[j_garcia]

I see where you are coming from Chris, and to some extent I agree, but we all like to feel we got a good deal on something. That doesn't mean I have to get a deal on everything. The way I actually see it: support the places you want to still be around. If you like a restaurant or small local store, SPEND SOME MONEY THERE

 

[chris357]

I see where you are coming from Chris, and to some extent I agree, but we all like to feel we got a good deal on something. That doesn't mean I have to get a deal on everything. The way I actually see it: support the places you want to still be around. If you like a restaurant or small local store, SPEND SOME MONEY THERE

the car angle is an emotional topic for me, and its one that seems to get alot of attention. Its funny how people think they know all about an industry that they have never worked in, and the information they have is written by people who really have no clue either.

imagine trying to do your job and every bit of information your prospective customer is giving you is un true.. no I dont have a trade, I'm paying cash, it does not matter what the payment is to me I can afford whatever it is I'm just looking for your best price..

the funny thing is that people while shopping for a car will almost always believe a lie but will rarely believe a truth.



but yes I agree with you people for the most part just want to get a fair deal.

 

[Serj22]

I have the super edition of Terminator Salvation on Blu-Ray, so I still get to see Bloodgood's boobs, though I don't understand the insertion of that scene in the movie at all, since it randomly jumps to them meeting those random raider guys. It was appropriate in Planet Terror, but "boob jumps" in scenes don't work...

continue topic...

 

[chris357]

yeah sorry about that some things strike a nerve..

anyway as far as rentals go or unrated versions over rated versions i really never notice much of a difference.. now, im about as big of a perv as you can get.. so i love female nudity in movies but if we are talking about a couple seconds of boobs that really doesnt effect the movie who cares.. especially if i dont deem the movie buyable, i also expect their to be some anoyances such as bad or damaged dvd's and other misc crap with rentals but for 20 bucks a month for as many movies as i can watch.. I'm ok with it. if they asked me what i wanted i'd want the better but beggers cant be choosers.

 

[MatthewB.]

You all are missing the point. Blockbuster has done this for over a decade (editing movies) they are a Mormon owned company and being such they feel they have the right to edit movies to their beliefs. I recall Speilberg sued them over this and they reached a settlement and the debacle over the movie "Striptease" when Blockbuster heavily edited and sold "their" wholesome version.

 

[jostenmeat]

You all are missing the point. Blockbuster has done this for over a decade (editing movies) they are a Mormon owned company and being such they feel they have the right to edit movies to their beliefs. I recall Speilberg sued them over this and they reached a settlement and the debacle over the movie "Striptease" when Blockbuster heavily edited and sold "their" wholesome version.

I think this must explain why I've always found BB's selection to be pathetic.

 

[chris357]

maybe its time to switch back to netflix? i went to BB because you can exchange in the store..

 

[MatthewB.]

What irks me about places like BB editing movies is the fact that because of their religious beliefs, they want to dictate what I want to see. First off it's illegal to re-edit movies without the directors, producers and studios permission (hence the lawsuit by Speilberg when he found out that BB had edited "Saving Private Ryan" for the ultra violent scenes.

I recall in my 20's I was living in Mesa, AZ (populated 90% by Mormons) and went and saw "Time Cop" with Van Damme now I had already seen this movie in Phoenix and a buddy I know wanted to see it, so I said sure and saw it in a Mesa Theater and noticed that the "virtual sex" scene (engineer of time machine is watching hot naked chick play with herself) was edited out. I walked out to the manager and asked what the hell was going on and he said, because the Mormon community makes up most of his business, he edites all movies of sex scenes or extreme violence and language. I asked him if he knew that was illegal and that the studios might have something to say about that. He didn't care and said all theater owners in Mesa (as well as Utah) do this to not offend their core audience.

I was pissed, I mean I spent good movie to see the entire movie, not some "tame" version because some religious group might be offended by a boobie shot. From that moment on, I refuse to go to a Mesa theater or join Blockbuster. In fact BB is pretty close to me but i travel further to rent my movies because I want the full version.

It irks me when any organization tries to interject their beliefs on me either directly or indirectly. I don't interject my views on them and feel if they don't like nudity, violence or language, then maybe they should crawl under the rock they came from and stay silent.

We as consumers should not have to assume what we buy hs been hindered in any way because of any group. This would be akin to McDonalds going with meatless burgers because the owner decided to become vegan.

I like nudity, extreme violence in movies and language hence why i went to a "R" rated movie, and not a PG one.

 

[j_garcia]

It irks me when any organization tries to interject their beliefs on me either directly or indirectly. I don't interject my views on them and feel if they don't like nudity, violence or language, then maybe they should crawl under the rock they came from and stay silent.

We as consumers should not have to assume what we buy hs been hindered in any way because of any group. This would be akin to McDonalds going with meatless burgers because the owner decided to become vegan.

I like nudity, extreme violence in movies and language hence why i went to a "R" rated movie, and not a PG one.

While I agree with you completely, "they" see it the same way. They don't want to have what they consider to be the values, or lack of, of Hollywood pushed on them with the same level of conviction. These people annoy me, but they are entitled to the same rights as anyone else and if they want to see a dumbed down, filtered, white washed version of a film, it is their loss.