Movie Culture: Video-DVD Stores Obsolete

April 12, 2008–Regular trips to your local video rental store may be a thing of the past. Netflix and Blockbuster are already offering DVD rental service by mail., Microsoft’s Xbox Live, and Netflix deliver movies directly to the PC. TiVo, Vudu, and Apple TV, not to mention cable and satellite companies, are doing the same for TV sets.

Local independent stores notwithstanding, the only major options left for renting discs are Hollywood Video/Movie Gallery and Blockbuster.

The Hollywood Reporter says Blockbuster may be giving customers more reasons not to visit its stores. The rental chain is making a set-top box that will allow video content to be streamed directly to a television. Such announcement will be made soon, according to the trade magazine.

A Blockbuster spokeswoman said it’s talking to companies about ways to provide access to media content across multiple channels, from stores, by mail, through kiosks, through downloading, through portable content.

The service would take advantage of video-on-demand technology from Movielink, which Blockbuster bought last year, allowing movie downloads from Universal, Paramount, Sony, MGM, and Warner.

There was no mention of price or how such a service would work. To compete with Apple TV or Vudu, the device would have to cost around $200, and rentals of movies and TV shows should be around $3-$4 each, which would be slightly cheaper than rentals of new releases from Blockbuster.

The big advantage Blockbuster would enjoy over Apple TV, Vudu, and TiVo would be selection. Considering its longstanding relationships with the studios, it would have the largest library of films and TV shows.

The device represents a new direction for Blockbuster and the video rental market. Money spent on DVD ownership and rentals has decreased steadily for the past years, according to the Digital Entertainment Group, which tracks sales. And though there’s no indication Blockbuster would eliminate its stores, a streaming video service would clearly cut some of that business.