DVD versus Download – Movie Rentals

January 27, 2009

Ok, someone needs to explain this to me. It makes no sense how expensive digital movie rentals are. It truly boggles my mind. I have a number of ways to rent them, and they are all expensive, a quick sampling of ‘recent releases’ gives:

iTunes: $2.99 – $3.99
Xbox Live: $4.00 – $5.00
Comcast onDemand: $4.99 – $5.99

Given that on all those you are just downloading and/or streaming it, there is no physical medium, etc. Why is it so expensive?

Especially when I can go to a Redbox machine at any number of stores near me locally, and pay $1 to get a physical DVD rental.

That’s right, all these other companies are charging $3 to $6 to rent a movie electronically, but Redbox someone manages to do it for $1, while handling physical disks, having to replace them as they wear out, sending people out to restock with new movies, pay for and maintain a rather complicated machine, and give kickbacks to the store they sit in.

Something is very wrong with this picture. By comparison alone, electronic rentals should be at MOST $0.99, and possibly a fair bit less.  Is there some part of the big picture I’m missing here?  I’d love to know.

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