It’s business as usual for Blockbuster and Warner Brothers.
The two sides renewed their deal that allows Blockbuster to rent Warner Brothers DVD and Blu Ray releases on their street date. The agreement gives the rental chain a leg up on Netflix, where users can’t rent new releases from Warner Brothers for thirty days after their street date.
The pact includes three of the four distribution methods Blockbuster engages in: on-demand digital delivery, its by-mail subscription service and the old-fashioned method of renting to consumers who walk into their dwindling store locations.
Blockbuster’s dollar-kiosks also will rent new releases from Warners — and every other studio — the same day the DVD hits retailers. Those kiosks, operated jointly with NCR, were not part of Tuesday’s or any other deal, so rules there could change. Redbox and Netflix, on the other hand, have agreed to wait 28 days before renting new-release DVDs from Warners.
The first tests to see how this new wrinkle in home entertainment windowing works to Blockbuster’s advantage could be informative, given that they involve a couple of hit movies: “The Blind Side,” which came out Tuesday on DVD, and “Sherlock Holmes,” due March 30.
When Redbox and Netflix agreed to the 28-day moratorium, they did so to ensure a steady flow of product at a reasonable cost. In Blockbuster’s case, insiders said its deal with Warners was expiring, so an extension — with modifications — was in order. To help heavily indebted Blockbuster stay afloat, the studio agreed to let Blockbuster keep more of the rental money upfront but pay more on the backend.
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