Redbox, Warner Bros. headed to war over new DVD delay
Warner Bros. and Redbox are about to re-ignite a battle over how long consumers have to wait to rent DVDs.
The Time Warner Inc.-owned studio is instituting a new policy that all DVD rental outlets must wait 56 days from the time the disc goes on sale at retail outlets Wal-Mart and Best Buy until consumers can rent them, according to people with knowledge of the matter who were not authorized to discuss it publicly. That's double the current 28-day "window."
A spokesman for Warner Bros.' home entertainment division declined to comment. But executives at the studio have previously said they were seeking a longer delay, which they believe will help boost flagging DVD sales and video-on-demand, both of which are more profitable than disc rentals.
Netflix has agreed to abide by the 56-day delay, one of the people close to the situation confirmed.
However, Redbox will wait no longer than 28 days to rent discs, interim President Gregg Kaplan said in an interview this fall. A spokeswoman confirmed Friday that the company's position has not changed.
That means the $1-per-night kiosk company will no longer be able to get discs directly from Warner Bros. but will have to buy them in bulk from retail stores. Redbox did the same thing in 2010 when the parties were in a similar fight. Illinois-based Redbox ultimately agreed to the 28-day delay.
The new policy, expected to be announced next week at the Consumer Electronics Show in Las Vegas, is to take effect Feb. 1, the day after Warner Bros.' current deals with Netflix and Redbox expire.
It's also expected to extend to the nation's third-largest rental outlet, Blockbuster.
[Updated, 2:18 p.m., Jan. 6: A person familiar with the thinking of executives at Blockbuster said it too will not accept the 56-day delay and will buy Warner Bros. DVDs through alternative means.]
Previously, Blockbuster was the only major DVD renter that offered discs the same day they went on sale, an advantage studios gave the struggling company as it went through bankruptcy last year and was ultimately bought at auction by Dish.
Warner Bros.' new policy could soon be adopted by Universal Pictures. That studio's agreements with Redbox and Netflix, which include a similar 28-day delay, expire in April.
-- Ben Fritz
Photo: Anja Murphy returns videos to a Redbox kiosk in an Albertsons supermarket in Santa Monica. Credit: Lawrence K. Ho / Los Angeles Times