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Rental Rebound?

17 Mar, 2009 By: Thomas K. Arnold

I was in the local Albertson's last night and the store was empty--except for a line of four people at the Redbox kiosk. Given the economy, video rental has got to be staging a comeback. I think the recent Blockbuster numbers, which showed a slight decrease in same-store rental revenue, might have been a bit deceiving because to the best of my knowledge Blockbuster wraps in sales of previously viewed discs with its rentals, and we all know that sector of the business is down. Someone else who believes rental just might have a rosy future is veteran analyst (and former manager editor of Home Media Magazine back when we were still known as Video Store Magazine) Tom Adams, who has this to say on his Web site: "Though consumers put the brakes on most discretionary spending during the second half of the year, the video rental segment wasn’t hit as hard other retail businesses. The main reason: new and attractive forms of rental—online subscriptions and $1/night kiosks—are making up for continued declines in traditional specialty-store rentals...As the rental business reached its 30th birthday, it is still the most popular way to watch movies at home, with a total of 2.5 billion rental turns in the United States last year." Adams notes that last year the video rental business finished the year "virtually flat," while "everything else was down."


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