BlockBuster to end late fees

[Andrew Pratt]

Blockbuster to end late fees in 2005
Move expected to cost movie-rental company $50 millionThe Associated Press
Updated: 10:41 a.m. ET Dec. 14, 2004DALLAS - Blockbuster Inc., the nation's biggest movie rental company, plans to eliminate late fees on games and movies as of Jan. 1.

Blockbuster announced Tuesday it will continue to set due dates, with one week for games and two days or one week for movies. But the company will give customers a one-week grace period at no additional charge, starting on New Year's Day.

Renters who want to keep movies or games longer can buy the products, less the rental fee. Or, Blockbuster says customers can return products within 30 days for credit to their accounts, with a restocking fee.

"Doing away with late fees is the biggest and most important customer benefit we've ever offered in our company's history," John Antioco, Blockbuster Inc. chairman and chief executive, said in a prepared statement. "So as of the first of the year, if our customers need an extra day or two with their movies and games, they can take it."

Officials of the Dallas-based company also said Tuesday they expect continued softness in the rental industry and flat operating income in 2005 compared with this year before the estimated $50 million costs of marketing and implementing the late-fee elimination policy.

Blockbuster said it has tested the new program in some markets and found increased rental transactions and retail sales offset the decline in revenue resulting from eliminating late fees.

For the full year 2005, the Company projects that late fees would have contributed approximately $250 to $300 million to operating income. But it said that is expected to be offset by growth in revenues due to increased store traffic, less promotional and marketing activity and an increased focus on operating expense management.

Blockbuster has more than 4,500 company-operated and participating franchised stores in the United States.

[Gordon Moore]

At $5 - $6 a rental they can still kiss my ;s@ so, no late fee....big deal :roll:

I wonder if the rental fee will go up? Time will tell. I simply do not support them or their rental pricing. The only time I go there is to buy their used material...I have to admit their prices can be pretty good used. When it comes to renting though, they're whacked.

I'll still support the local chains that somehow manage to thrive charging 1/2 for a rental. Heck, Shell stations rent for $0.99 every day (where available).

[Andrew Pratt]

Unfortunatly for me there aren't any local places to rent from other then Rogers or BB.

[Burke Strickland]

Have you ever gotten a return receipt from Blockbuster when you bring back videos to prove your case later if they claim the videos were late? Saving paper is not the only reason they don''t issue them. "Late fees" have been assessed too often by Blockbuster after the fact by charging the customer's credit card of record whether the returned videos were actually late or not.

"Late fees" have been a major profit center for them, and their misadministration was a major reason I decided several years ago never to set foot in a Blockbuster again. Now that they are waking up to the unpopularity of "late fees", as evidenced by their non-use by competitors such as Net-Flix, and Blockbuster's declining market share, I just wonder what ridiculous un-consumer-friendly BS Blockbuster will dream up to screw their customers to make up for this lost revenue stream?

Burke

[gd]

I don't care if they give videos away free... Blockbuster can take their twisted, self-righteous stealth censorship policies and go jump in the lake.

Patronize the neighborhood stores... if that's not an option, patronize Netflix.

[Lex]

I believe a few feathers have been ruffled here! I remember being called by a store across town a few times about rentals not being returned. Did they even bother checking the address of the person? There was another guy same name here in my town, and he was worthless. I mean totally. I'm sure he checked them out and never returned. I really had to say hey, you got the wrong guy aggressively for them to believe me.

I've never been a big fan of the BB. I did stop in a while back and bought a few used movies fairly cheap. But were they censored editions? That concerns me. I mean I want to hear all the cusssing and nudity there is you know. lol. I'm kidding.

lex

[Burke Strickland]

There was another guy same name here in my town, and he was worthless.

That must have been Lex Luther. Superman didn't like him either. :>)

Burke

[Brandon B]

Blockbuster to end late fees in 2005

. . . But the company will give customers a one-week grace period at no additional charge, starting on New Year's Day.

Renters who want to keep movies or games longer can buy the products, less the rental fee. Or, Blockbuster says customers can return products within 30 days for credit to their accounts, with a restocking fee.

What they have done is extend the period of the rental to plus a week, and renamed the late fee a restocking fee, without lowering prices. It's still a late fee, so I don't buy that they have eliminated fees. Nice attempt at spin though.

It just perpetuates why I never have used them. Higher prices, even if the period is longer.

BB

[drosophila]

Being a former assistant manager of a BBV, I can tell you all one thing (besides the fact that most people are rude and vile, particularly to service people):

This is going to backfire immensely on all those customers who've been saying, year after year, "well, I pay so many late fees, I may as well have bought it!"

See, one little-noted thing about video rentals is that BBV and other rental places don't typically pay the $14-$22 we all pay at the store. A lot of them, particularly lower-volume titles, are purchased for upwards of $70-$200, because they're going to be resold. It wouldn't make sense for the distributors to make $14, and BBV to make 10 times that. Hence, the resale charge.

I mention this, because the thing not being mentioned is what most people will probably try and take advantage of. They'll rent the movie, decide they like it and aren't going to return it, because, "hey, I get to keep it!". Trick is, when they come back to the store to rent again, the poor kid behind the counter is likely to inform them that they now owe $70 for the purchase of the movie. The late fee system etches away at whatever loss BBV would suffer on a day-to-day basis, but the customer generally isn't assessed the full amount unless they don't return it at all.. now that the fee system is gone, and customers feel there's no repurcussion for taking off with it, something tells me a lot of people will be in for a sudden shock after "buying" their rental.

Watch and wait.. everyone wants something for nothing, after all.

[Brandon B]

It's not just the fact they may be resold that makes them $70-200. It also a different price for different licensing of the product. It is being sold specifically for rental and hence viewing by multiple people in exchange for payment, something that is contrary to the terms you agree to when you purchase a normal DVD or video.

Remains to be seen if BB will pass that full amount on to the customers though, since they are not allowed to then rent out the copy themselves.

BB

[drosophila]

It's not just the fact they may be resold that makes them $70-200. It also a different price for different licensing of the product. It is being sold specifically for rental and hence viewing by multiple people in exchange for payment, something that is contrary to the terms you agree to when you purchase a normal DVD or video.

Remains to be seen if BB will pass that full amount on to the customers though, since they are not allowed to then rent out the copy themselves.

BB

That's exactly what I was saying.. though 'licensing' is definitely a more accurate term

At least with Netflex and Greencine coming around, we have alternatives to BBV. I mostly just feel bad for the store employees that have to enforce this crap as part of their jobs

[chester]

Smacked in the face

I'm in Lexington, Ky I just got back form my local BB where they do not partake in the "No late fees" program. In fact I can't even choose another location because all of the BB's (10) in Lexington, Ky don't partake because none are corporate owned and so they don't have too. Anyone else experience this? Seeing all the hype and then this smack in the face has sent me to my much cheaper/closer Hollywood Video where they actually had what I wanted in stock.

[brendon]

Wow !!! $5-6 US dollars for a new release no wonder you guys are unhappy!Out here in darkest Australia I normally pay $3.95 in Australian dollars ($1 AUD = approx 78 cents US).I see from previous blockbuster bashing threads that not all titles are in widescreen as well!Its not unusual out here for the rental version of a film too be more explicit than the cinema release and I am not aware of rental movies being different (censorship etc) from one chain of rental stores to the next.
Brendon

[Gordon Moore]

$5-6 US dollars

I was talking CDN dollars...

[hidefdvd]

I was talking CDN dollars...

But if you spend the $9CDN at the time your membership comes due then you get atleast one movie rental per month for $2 off. Rent 5 per month get one free. If your a real movie junkie you can be renting for $3-4 movie.

hidefdvd

[brendon]

You pay membership fees?cant think of any stores out here that do that.
Hiring more than 1 new release at a time is also cheaper again and my local store does $1 rentals on off peak nights (new releases ,games etc) ie Mon through Thurs.I am not sure what the local Blockbuster charges but some of my workmates who have a different chian of stores near them pay closer to $6 to $7 AUD.Sounds like things are still a bit more competitive out here.
Brendon

[H.T.C]

Well now,they just extend the time you have with the disc,thats all.

Hmm, not bad for a large corporation too extend the rental period but its not eliminating rental fees.

[Gordon Moore]

no membership fees at Blockbusters in Canada...for the record. Our local shop has a $0.99 for not so new releases and 3 day rentals on those....and mostly widescreen selection.

Where do you think I tend to support? :B

[Andrew Pratt]

Gord you're lucky to have such a place locally...there's nobody left in my end of town other then BB or Rogers