Info about Video Rentals
The changing nature of video rentals stores
Video rentals used to be laborious and difficult, with limited selection and exorbitant prices. Of course, that was when video rentals were a novelty. Now, they’re so mainstream that people have lots of options in the competitive field to search out the best video rental stores and decide for themselves what set-up they like best. Most video rental stores offer a similar selection of films, but differ in price, and occasionally format.
In the 1990’s, there were hundreds of thousands of different video rental stores. It was not at all uncommon to see more than one store operating in the same town, if not on the same high street. As time progressed, competition and costs forced the smaller businesses to shutdown, and the strongest competitors began to assert themselves. The advantage was always in the hands of the chain stores, such as Blockbuster Video, who could benefit from economies of scale to do with buying their videos and games in bulk, as opposed to the one man rental shop which had to buy smaller selections of videos at a higher price.
As the new millennium dawned, so too did a new medium for watching multimedia- the DVD. These compact discs meant that storage was less of a problem, and smaller stores could stock a larger range of video. This had a number of significant changes on the rental landscape. Chiefly, it became common for local convenience stores to stock a larger selection of rental videos. This caused a great problem for stores set up specifically for rentals, as the number of people renting their films from the convenience stores increased massively. This drove down their profits, and forced a great number to adapt or shutdown completely. The vast majority followed the latter route.
However, some enterprising people identified the growth of the internet, and the number of people using it for everyday tasks, such as word processing and writing emails. They believed that if a large number of people were computer literate in this way, then they would be comfortable ordering video rentals online. These businesses, such as Netflix and LoveFilm, stored a large number of DVDs in warehouses. They then distributed these DVDs via the postal system to the customers who ordered them, who would watch the films before mailing them back.
Further growth in the internet allowed companies to deliver films and video content without the need for large amounts of physical storage space. The proliferation of Broadband technology and increased bandwidth meant that stores such as iTunes were able to offer rentals streamed directly to the customer’s PC or Mac. The way in which this works varies, with different businesses offering different models. With some, the rental can be watched an unlimited amount of times in a fixed period of time. Others allow the user to keep the film stored on their PC until they wish to watch it, which will then trigger the rental period- after which the file stops working.
The online streaming model has many advantages over the traditional physical media, in that it means people can choose the films they wish to view without ever leaving the comfort of their own homes. It also means that films will never go ‘out of stock’, meaning that the customer will be satisfied more often. It will also usually prove to be a cheaper option for both the customer and the provider, as large storage costs are not required. Likewise, the provider has no need to purchase physical DVDs, and may not need to pay any money down at all, instead coming to a profit sharing agreement with the studio which produces the films.