Re:Movie Studios See a Threat in Growth of Redbox
by pyre on Monday September 07, 2009 @04:05AM
(#808796)
They call the 'Mom n Pop' model the opposite of revenue sharing, but many 'Mom n Pop' stores do revenue sharing.
One thing that they fail to mention is that part of Red Box's success is due to their expansion. It allows them to shift product that isn't renting well in a particular area to new kiosks. This helps them to: a) pay less for new product in new kiosks and b) not be forced to either trash the existing product to replace it with other titles or let it sit there not earning back any money for them. There are lots of examples of companies built on expansion that ran out of steam... Krispy Kreme for example.
One thing that they fail to mention is that part of Red Box's success is due to their expansion. It allows them to shift product that isn't renting well in a particular area to new kiosks. This helps them to: a) pay less for new product in new kiosks and b) not be forced to either trash the existing product to replace it with other titles or let it sit there not earning back any money for them. There are lots of examples of companies built on expansion that ran out of steam... Krispy Kreme for example.