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Redbox price hike angers customers

As of Oct. 31, a DVD rental will be $1.20 per day. Video game and Blu-ray fees won't change.

By Donna_Freedman Oct 28, 2011 8:29AM

Stop me if this sounds familiar: DVD-rental company raises prices.

Movie and game-rental giant Redbox has just announced a 20-cent increase in its film rentals, citing increased operating costs.

On the same day its parent company, Coinstar, announced that third-quarter earnings rose 90% -- which The Wall Street Journal reported was based on "strength from its Redbox movie- and videogame-rental kiosks."

By dinnertime, nearly 2,100 reactions had been noted on the Redbox Facebook page. While some people said "no biggie," many people howled with indignation. Some brought up the recent Netflix price hike that resulted in the loss of 800,000 subscribers.

One (former?) Facebook fan had this to say: "Well Good Bye Red Box I got rid of NetFlix for the same reason and now I will no longer rent from your machines …"

Customers can still get the $1 price through November for DVDs reserved online.

 

Post continues below:

An affordable alternative?

Whereas Netflix simply announced its price increases, Redbox tested higher fees -- most recently in summer 2011 -- to see if a change in price would mean a change in rental habits. According to an Associated Press article, "management concluded there would be only a slight drop-off in DVD rentals" if fees went up.


"We didn't take this lightly," CEO Paul Davis said in the AP interview.


At the same time it was testing higher fees the company was also making plans to woo Netflix defectors. The jump in revenue seems to indicate that plenty of those disgruntled former subscribers did see Redbox as an affordable alternative.

Additionally, Davis told the AP that the number of unique credit cards used to rent DVDs increased 8% between July (when Netflix made its announcement) and September.


It had been eight years since Redbox raised its rental fee nationwide.


Now what? Maybe irate renters will flock to Blockbuster, Vudu or some other Netflix/Redbox alternative. Maybe they'll look for DVDs from the public library. Maybe they'll stage an "Occupy Redbox" protest.

Or who knows: Maybe they'll watch fewer films, opting instead to read more books or have actual conversations with family and friends.

An article at Deadline New York notes that Redbox plans to inaugurate digital streaming by the end of 2011. Given how many people left Netflix in a huff, it will be interesting to see how many people stick around to use that service.

Readers:
Will a 20-cent increase be enough to turn you off Redbox?

More on MSN Money:

345Comments
Oct 28, 2011 11:05AM
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The nickel and diming of consumers everywhere continues.
Oct 28, 2011 1:13PM
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world is full of whiners.

everyone seems to forget they used to pay $5 for a single movie rental.  God forbid your movies go up 20 cents... :o

You pay more for a soda out of a Texaco.

I loved the part in the article that said people are going to have to read a book now, or have an actual conversation for entertainment .... *gasp*

But who wants to pay $10 for a book these days ........................ talk about greed, people want everything for free and on demand.

Oct 28, 2011 11:57AM
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Well for one here in ohio we have already seen an increase to $1.50. Add another 20 cents today and another after the new year and before you know it its 3 or 4 bucks a movie.  Ask the oil companies how happy they are only raising a few cents at a time and before we could say boo- hoo it was $4 bucks a gallon and they made us grateful to get it for that. Just a few cents huh. It always starts that way.
Oct 28, 2011 6:20PM
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I stopped using Redbox a very long time ago.  I can get any movie Redbox offers (and then some) for free, keep it for a WEEK, and if late, pay a  .25 per day  fee.  For what Redbook proposes to charge, I can keep the DVD 12 days!  Where do I get such a great deal you may ask?  From the PUBLIC LIBRARY for which I already pay through taxes.  Since instant gratification is not important to me - I don't need to see the movie 1 hour after its release - I ultimately see every movie I want, albeit sometimes several weeks after release, but my cost is nil.  I'd spend the same in gas going to Redbox as to the library and no worries about returning the next day. 

 

I don't understand people - always complaining about what they think they're "entitled" to.  If you don't like the rise in price, it's simple.  VOTE with your wallet and DON'T GO!!!!!  There are alternatives.

Oct 28, 2011 4:05PM
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It is amazing the number of people who are in other people's pockets talking about what they can or can not afford. How about this, I can afford it. It would be no biggie. I just have a fundamental problem with it. You tell me that you are raising prices to cover escalating costs, I can get with that. You gotta earn to live. But at the same time you boast of a 90% increase in 3 qtr earnings, now I have a problem because your original claim for the 20% increase has now fallen flat.

 

You raised prices not because the cost were encroaching on your income, you raised prices to simply increase your income. It isn't just about businesses making money to make a living. It is about people in the decision making chairs desire to continue feeding their excesses at everyone else's expense.

Oct 28, 2011 4:28PM
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I wish I saw as many people getting irate and involved over the increase in their cost for health insurance as I see getting upset and involved over the increased cost of their entertainment.
Oct 28, 2011 2:48PM
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20 cents today, 50 cents tomorrow...    Before you know it, $5.00 for a movie.

Nip it in the bud!

 

People pay $8.00 for a beer at a ball game  because they just kept accepting increases over time.

Stop buying and shut the fu-ggers down!

 

Eventually companies will get the hint. 

 

P.S.  Most movies are so crappy today, they aren't even worth $1.00.

 

 

Oct 28, 2011 1:23PM
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Let see I stopped by Home Depot yesterday and picked up wood pellets, they had jumped by about 18% in the last 2 weeks.  Now Redbox raising prices by 20%; you think businesses are reading the press propaganda about people being ready to spend some money through the holidays and want they share early?  Well I have news for the hopeful retailers I for one do not plan on spending anywhere near that $700 per person figure the survey said people were planning on spending for the holidays.  I may spend $700 in total and probably part of that will be for the essentials we need but the rising cost of food, fuel and utilities are going to take a bite out of it.
Oct 28, 2011 1:52PM
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"One (former?) Facebook fan had this to say: "Well Good Bye Red Box I got rid of NetFlix for the same reason and now I will no longer rent from your machines …""

HAHAHAHAHAHAHAHA. Thank God people still know how to be funny.....

 

Who wants to bet the guy made that comment on his iPad while sucking down a Starbucks mocha frappa crappacino.

 

I couldn't BELIEVE the price redbox was charging when I first started seeing them. The only real drawback to them is the limited selection, but I think most people understand it's the go-to place for new releases. I'll dip into my 401K for the extra 20 cents, I guess...

 

NetFlix, too, seemed to bring out the whiny in people. "OMG, you mean I'll have to go to another site? Isn't that an additional click of my mouse??!? That's it, I'm done!"

 

I utilize both services, and they are both a bargain.

Oct 28, 2011 3:50PM
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STOP IT People. We created this mess by always wanting more & more & more. Now we get to pay for it. 20% increase- six of one (not okay); half a dozen of the other (not bad). Well for me I can do without. Going back to "Keep It Simple Stupid" lifestyle. I have found a few things to do that really do not cost much. I watch regular TV (no cable); wait for the movies to come on TV. I bike ride, read lots of books. I volunteer at the Performing Arts Center. In other words- find something to do rather than sit on your duff and complain about the price and/or the movie. If we STOP contributing, then maybe, just maybe someone might get the hint. We, as a people, created this so call corporate greed. So, we as a people, can eliminate it. But ooooh noooo, can not live without the necessities of life (DVDs, computers, cell phones, ATM cards & so forth). Shop around, I'm sure there are other alternatives, that are reasonably priced or free.
Oct 28, 2011 4:52PM
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I'm hoping  the passion that has gone into rejecting netflixs, and now grumbling with red box will surface again when congress, begs us for our votes, and we remember what  a lousy job they've been doingSmile
Oct 28, 2011 3:35PM
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Why do companies think they can raise prices so fast and people won't get angry. The people using their services are the one's on a budget, not the 1%er's.
Is this a serious statement?  This is frightening that people in America that say things like this are allowed to vote or pro-create.  Unreal.  In case you don't know, the US is a free country because many young men died in order to make it that way.  RedBox can do whatever they want with their prices, it's THEIR company.  You do not have to purchase RedBox products or services if you so feel.  Hence, the FREE comment about our country.  If you are on a strict budget where you can't afford a 1.20 movie, then you should not be renting movies to begin with.  Unbelievable...

Oct 28, 2011 9:38PM
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To those of you who say "get over it" you must be loaded.  Its not just Netflix or Redbox.  Its all of corporate America!!!  $1 here $.20 there, it adds up! I haven't had a raise in 4 years but everythings going up. Go figure

 

Oct 28, 2011 6:09PM
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Local libraries have a nice and latest movies collection and it is free. Paid for by the people like you.

Time to get rid of these greedy crooks. They are always putting profits before customers in a difficult time.

There is no question that America is facing some serious challenges. Fourteen million people don't have jobs and struggle daily.

Oct 28, 2011 5:47PM
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Dear Redbox,

 

I'm confused about your statement of operating costs going up. I just read about Coinstar's 90% growth and it was mostly due to Redbox. Twenty cents is a 20% increase! We all know you are only going to continue to try to squeeze every cent out of consumers. You are going the opposite direction of what American companies need to be doing.
I spend about ... oops, I did spend about $150.00 a year on Redbox. I will now start using Blockbuster Express exclusively.
I know your organization is only trying to capitalize on the Netflix fallout. You are now creating your own fallout.
If truly the issue is debit cards, then give customers the option of using charge cards without the increase.
I encourage your company to rethink the direction you are going. Are you with the American consumer or are you just another greedy stinky?

Oct 28, 2011 9:29PM
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So heres the thing...we don't have the extra money to pay the corporate big guys!!!  With all the talk about how we should cut back and manage our expenses better the big guys think we should pay them more.  We, as Americans, are losing our homes and our jobs so why in the world would they think we're going to pay them more for their services??  We have to have electricity, its going up...we have to have water, also going up, gas in our cars, oh yep going up and of course food, you know it...going up.  No we aren't going to pay your extra charges for things we absolutely don't need.  See America, we do have a voice if we all stick together. Say no to all these charge hikes.....drop these people.  No we won't pay your extra bank fees, your extra dvd rental fees....look out cable because we can watch almost anything on our computer.  Your next, cause lets face it....your costs are going outta this world.  We're mad and we're not gonna take anymore!!!!  We don't have to have wild and crazy protests on the street we just have to show the big guys we don't need them anymore.
Oct 28, 2011 1:30PM
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I left Netflix when they raised their prices, but they DOUBLED the price...Redbox is only raising it by 20% and the price was already cheap.  Where else can you're entire family watch a movie for $1.20?  I'll continue to use Redbox. 
Oct 28, 2011 4:08PM
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Here's the thing, yeah monies tight so I made allowances 2 years ago. 

 

1) Stopped going to movies savings average 20.00 a person 12.00 for movie 5.75 for soda and 3.25 for small popcorn.

 

2) Stopped driving to work, now I ride a bike.  Saving fluctuates gas currently 3.70 a gallon still in my pocket.

 

3) Stopped buying clothing and make my own.  The initial expense was higher since I took a class on sewing but now I can make clothes for less than 1/3 the cost.

 

4) Started a garden and grow vegetables, garlic and peppers.  Trade with my neighbors for Oranges and Lemons.

 

5) Cancelled my home phone, cable, and used the saving to put in solar panels.  My average utility bill is 9.00 down from 175.00 since gas and electric and included on one bill.

 

6) Moved my money from Chase to a credit union where there are no fees or restrictions for using ATM's

 

7) Cancelled Netflix after price increase. More for the lack of selection than the price increase.

 

8) Only buy meats when they are on sale 2 for 1, which happens more than you think.  Chicken, pork and turkey are still bargains.  I bought a meat slicer and can make lunchmeats for the kids besides providing meals.

 

9) Coupons join a trading group.  4 friends and I swap coupons (since a lot of store have restrictions) and they produce an average saving of 40.00 per week.  Normally, you need to buy in bulk to get maximum savings.

 

10) Cancelled Verizon and use a flat rate plan from Wal-Mart that includes texting and unlimited calls for 49.95 a month savings around 60.00 per month.

 

Take one week a month and spend nothing.  No monies at all.  If you all did this message would get through.  Until you use your consumer power no one will get the message.

 

Sometimes is not about the money but instead making a point. 

 

 

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NBBowler... It's not about a $0.20 increase. Just about everyone can afford that type of increase. It's about a corporation increasing their prices by Twenty Percentage Points in a weak economy after their number one competitor tried increasing their prices by 60% and failed miserably. This is all about a PR nightmare that is about to be self inflicted by the company themselves!
Oct 28, 2011 3:05PM
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It's all a shell game. First NEtflix, then the FOX network wants a 40% increase which DirecTV says they have to pass on to the consumer, then Red Box raises their prices. I cancelled Netflix, have and never will use Red Box and am cancelling DirecTV for not being able to deal with FX. I'm rich !

With the money I will be saving I can purchase at least 4 DVD movies per month and in no time will have a nice library going, and it will belong to me. I can also share with my neighbors and if they catch on there is no end to the amount of movies available in one's own back yard. Screw the system and all the greedy morons that run it.

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